TRADE AND FINANCE

New Zealand Herald, Volume LXX, Issue 21457, 3 April 1933, Page 5

TRADE AND FINANCE

BRITISH CONDITIONS PROBLEMS STILL REMAIN STOCK MARKET REVIEW (Received April 2, 5.5 p.m.) LONDON, April 1 The London Stock Exchange has reverted to dullness, as usually is the case when the Budget approaches. There has been a slight reaction in gilt-edged stocks from the high level reached a fortnight ago. '• This was largely clue to profit-taking .salts, wftich also caused slight dec-lines in some corporation issues. Dominion stocks, however, are holding their own well, being in good demand. The new Commonwealth 4 per cents have advanced to £lOl los. Commenting on the position at the end of the first quarter of the fourth year of the depression, a writer in the Financial News says; "1 think on tho whole we have to be thankful that the last three months destroyed fewer illusions and left investors richer than might have The home trade has been none too good. The setback to some industries like textiles looks more than seasonal. "All the old problems are still with us. We have had a first-class crisis in the United States, which has been stayed but not resolved. We are looking forward to the Budget, which will grant us the less relief the more it is balanced. Yet, three months ago, the per cent war loan was £99 against £lOl to-day; Austin Motors were 80s, against 48s 3d; Robinson , Deep B were 16s IJd, against 295. 4d and Consolidated | Tea were £6 10s, against £l4 10s." The verdict on the three months is that equities on the whole have held their ground. Bonds, including giltedgeds, first consolidated and .subsequently improved upon their position after last year's advance. Good news indicating a certain improvement in trade was announced to-day. First from Paris comes the report of a heavy increase in receipts from the Suez Canal charges. For tho first three months of the year these total about £1,697,000 at par, compared with £1,640,000 for the corresponding period of 1932. The seconrl is that the accounts of the Royal Mail Steamship Company for 1932 show an encouraging recovery in earnings, enabling the directors to pay „ off some of the arrears on the preference dividends. BONDS INTEREST TAXATION LONDON QUOTATIONS CEASE (Received April 2, 5.5 p.m.) LONDON, April 1 Some sensation was created in the Dominions market on t)ie Lcndon Stock Exchange by the decision- of dealers in Canadian securities to suspend business in them owing to the Canadian Government's proposal to levy a tax of 5 per cent on all payments to holders not resident iin Canada. Consequently tha official price list gives no quotation for Canadian stocks, tha Usual figures being replaced by dots. It is expected that this action will have the desired effect and cause tho Canadian Government to abandon what one of the financial journals calls: "Not only an undesirable precedent, but an undesirable practice." POSITION EXPLAINED MISUNDERSTANDING REMOVED - OTTAWA. March 31 The 5 per cent tax on interest payable pn Canadian bonds held by ncin-. residents of Canada as proposed in the Budget will not apply to any bond, public or private, on which interest is payable in currency other than Canadian. The Minister of Finance, Mr. E. N. Rhodes, made this statement in the House of Commons to-day in order to clear up misunderstandings that had arisen the operation of'this tax and resulted ip dealings in Canadian bonds and certain securities being suspended on the London Stock Exchange. "I thought I had made it abundantly clear in my former statement to the House that it was not intended to tax the interest of Dominion of Canada or Canadian National Railways guaran- J teed bonds paid to non-residents," Mr. Rhodes said. " This exemption was' granted because, while there is no doubt of the power oj: Parliament to impose such a tax as is done in the case of other countries, nevertheless, a misunderstanding might ayise in the mind of a non-resident investor who had purchased Dominion securities in his own country and payable in his own currency. FREEZING SPACE HEAVY SEASONAL DEMAND. Fairly heavy demands are being made at present on freezing space in tha Auckland Province owing to ths favourable conditions for the fattening of stock and dgiry production. While the situation is hot actuually acute, owners of beef cattle are being asked not to press stock forward until further shipments have relieved tha stores. This course lias been occasionally taken this season to reduce tho pressure which frequently occurs before shipments are made. • These are being regularly despatched, and as there is an abundance of feed available, stock owners are not being subjected to any great inconvenience. The demand on tho dairy produce stores is reaching the peak, and although the volume of produce coming in is much greater thaif in tho previous year, no difficulty is likely to arise in Auckland in regard to space. A large increase was anticipated by the Auckland Farmers' Freezing Company and this has been amply provided for in the new building which has been erected. Consideration has not been given to the possible effects of a restriction of dairy produce exports, but it is considered that the works in other parts of the Dominion would be much , more seriously pressed to find storage than would the Auckland company. In any case,. the quantity of dairy produce will decrease steadily from now oil ward.