LONDON TRADE REVIEW.

New Zealand Herald, Volume LX, Issue 18519, 2 October 1923, Page 7

LONDON TRADE REVIEW.

FJHENCH , BONDS BUOYANT.

BUTTER /MARKET STRONGER. THE OUTLOOK FOR WOOL. ■•■■■'■• • '"*■;; '*. V- '■'■■ V--V■ : - ■ ■■ T '■■:■ '■>:'■■: '''.;."'■ ■■"'• - By f. Telegraph—Press Association— A. and N.Z. :/ . : LONDON. Sept. SO! The principal featurs of interest -on the Stock Exchange during the past week; has been the buoyancy of French bonds, following the collapse of passive resistance in the Ruhr. News of Germany's surrender led to a general recovery of prices arid the rapid improvement in the value of the French franc gave a sharp impetus to French bonds of all kinds, the movement being stimulated by the good demand from Paris. The strength, however, has not been fully maintained, for it is recognised that France has yet to solve her economic problems, and Germany's payment of reparations may be further, delayed by the unsettled state of affairs there. -

Even -German _ bonds showed some signs of recovery early in the week, possibly on account of the abandonment of passive resistance/ but more probably the buying of German 3 per cents, which 1 took place was the reason. Hopes that the institution of a new German currency will involve favourable treatment for loan-holders, and the success of the Victoria loan had a stimulating effect on the .gilt-edged market, but the talk of other loans coming caused gilt-edged stock to close slightly below. The best industrial stock has been brisk, with "quite an extensive boom in tea shares. In the \ foreign exchange market the feature has been an . improvement in Allies' currencies, which, though not fully maintained, is decidedly welcome. The recovery of the French franc is attributed largely to sentiment and reaction, It was quite a naturai sequence after the first wave of optimism arising from Germany's surrender had passed away. German exchange fluctuates daily in hundreds of millions of marks, but quotations are quite nominal. A. good illustration of the degradation of the mark was witnessed in the streets of London, where gutter merchants are :'■ selling genuine hundred thousand mark notes for twopence each. A note for a million marks can bo bought for sixpence. ■•■''. Butter- Shortage; Likely. . .The butter market gets stronger every day. Actual stocks of. the best butter here are very- small, and: for the' next two months little can arrive from Australia or New Zealand. -.>•'.

Danish production *is rapidly decreasing, arrivals from Denmark being now only little more than half what they were in the summer. So we are faced with a shortage of supplies. The general expectation is that prices will harden still' further. Retailers, will probably raise their price to two shillings next week, but it is .not expected the increase will havo much effect on consumption.

The cheese position is very strong. New Zealand stocks are practically cleared from importers' hands,, and only one small lot is .still to arrive. English and ■ Scottish makes have been sold out six weeks earlier than was the case last year, and have mostly been consumed by now. Canadian stocks here and in Canada aro estimated as about the same as year.. The market there has been very firm* and prices are advancing. V Our consumption is estimated at about three hundred thousand ..full-sized ' chesses monthly, and a, considerable shortage is probable : for the ';. next, two months, so prices for Canadian and for. any New Zealand ' held over .' are - expected to" harden '■■ , ■ > ■ . '<• '■ "- Crossbred Wools: in Demand.: Writing on the, wool outlook, a wellknown authority says that, taking a broad view, the : future ;is rendered some-' what obscure because of the continued depression in Britain. There is considerable improvement in the demand for crossbred sorts, but the call for merinos is still ; quite absent." _ This ' causes great concern, due to the continued depression 1 in tho fine worsted trade. The general contention " that part of this is ; due to prices being too high is open; to question. It is '.; doubtful whether there would be . any increase in trade if prices were lower for raw material. Meanwhile the trend- seems to be : toward increasing the use of cossbreds, especially medium' grades, in the coming season: The position of merinos will depend very ; largely on the strength .or'; otherwise ;of the American 1 demand, the issue of which is not yet clear. 'It is practically certain that both merinos; and crossbreds will be required '; by 'America in considerable quantity, especially if their mills .can be fullv employed, as seems probable. ll ' >\ The financial position of tho British market is widely, varied. ; :/, At the -raw; material end credit is exceptionally good;but there is still financial stringency and difficulty in the piece-goods ; especially ,•■ in , tho trading section. , •; '