REVIEW OF THE WEEK

New Zealand Herald, Volume LXXIII, Issue 22344, 15 February 1936, Page 9

REVIEW OF THE WEEK

STATE CONTROL POLICY FLUTTER AMONG INVESTORS SWING TO AUSTRALIAN ISSUES The Government's action in taking over the output of the flour milling industry caused a flutter in the investment market this week, and it has intensified the swing on the Auckland Stock Exchange, already noticeable, to Australian securities. The movement away from Now Zealand issues is by no means clearly defined, mainly because recent events have given rise to a conflict of opinion. With some investors thinking one thing and others the opposite, market trends were apt to be contradictory. However, it all means business for tho brokers, who exjxjrienced one of tho most active weeks this year. Only yesterday, was any indication given that tho buying wave of the past few weeks had been checked. Naturally, investors are asking, "After the flour mills, what?" ]f Government regimentation of industry continues —and it seems likely that it will —the question arises which field will next bo entered by the State. The milling industry was a comparatively simple task, as control was halfway there in any case. The cement industry looks to investors a likely objective, and the market has taken tho precaution of marking down Wilsons Cement by Is 6d. Retail meat and fertilisers arc other industries mentioned, but it is a case almost of "as many opinions as there arc men." Outlook Not, Promising

At all events the future for tho investment market cannot be regarded without some misgiving. Capital has never been particularly enamoured of Government interference in private enterprise. It has been necessary up to a point during the past few years, owing to the stress of economic conditions, but it is not relished as a permanent feature. Where it becomes widespread, capital is prone to take wings. That is the i'celing in the investment market at present. Extension of the Government's policy will mean a flight of capital, and not even the prospect of the Government appreciating the currency will wholly prevent it.

The possibility of New Zealnd's credit being endangered is not regarded as so remote that it has not influenced the market. The thought is apparent in the weakness of tho long-dated 4 per cent Government loans. For tho short-term issues there is a firm demand at higher prices. Following is a comparison of tho levels ruling a year ago for a selected number of Government loans, compared with those of the last two weeks: — Feb. 15 Last This t 1935 Week Week Bonds, 15/1/40, 4 .. 102* 101* JOlVa Ditto, 15/2/46, -l .. 107 103 10a Stock. 15/3/39-43, 3% Ditto, 15/5/39-52, 3% 106%* Ditto, 15/4/49. 4 .. 107 3 i 104'/, 104% Ditto, 15/6/55, 4 . . 103% 101/e 104/ a 'Buyers. Banks Still Rising

Banks continued to show improvement, although the rate of advance slowed perceptibly. English, Scottish and Australian, Nationals of New Zealand, New Zealands and Unions touched the highest point this year in dealing. In most of tho banks it is necessary to go back some years to find equivalent levels. Illustrative of the advance, English, Scottish are valued about 12 per cent higher than at the end of last year, Australasias, 10 per cent higher and Commercials and Nationals of New Zealand, both of which paid dividends in tho meantime, are 8 per cent dearer. At the end of 1935 such a prolonged riso in banks was hardly thought possible. In the market for industrials, Australian issues revealed additional strength, Broken Hills, Australian Glass and Kauri Timbers being in the forefront. Features of tho New Zealand market were sharp reverses in the flour milling issues, Bycrofts and Northern Boiler, and the drop in Cements. Plans for a new paper in Christchureh caused further weakness in New Zealand Newspapers, which have lost 4s in a little more than a week. Mining Shares Easier

Business in the mining market was confined generally to overseas issues, most of which were easier.

The following comparative table shows the levels of sales made on the Auckland Stock Exchange in the corresponding week of 1935, together with the lowest price touched last year and the closing prices at the end of the last two weeks:— „ . Feb. 15 Lowest Last This 1935 Price Week Week Bank A'asia .. Q32/G 217/6 '2(3/6 242/6* Com. Bk. Aus. 1(5/6 15/5 19/2 19/3 Nat. Bk. N.Z. . 71/- 60/3 76/Q 77/6 E.S. and A. .. 100/- 98/6 125/- 124/-* Bank N.S.W. . 630/- 600/- 695/- 690/Bank N.Z. .. 49'9 47/8 47/9 49/6 Reserve Bank., . 131/- 110/6 114/6 115/* Union Bank .. - 370/- 196/3 199/6 Nat. Ins. . . 23/1 19/3 18 10 19 3* N.Z Ins. . . 67/- 60/- 64/- 63/9t South British - 93/6 96/-Golds.-Mort .. 27/9 28/3 32/9 32/11 Mortgage Corp. Pukemiro .. 26/-* 22/6 20/6* 20 6* Auckland Gas . 27/6 25/4 25/8 25/8 N.Z. Breweries 51/9 50/- 53/- 53/3 Aus. Glass . . - 88/British Tobacco 37/9 .%/- 4./- 41/30 Broken Hill . . 53/- 49/3 59/6 59/9 Colonial Sugar . 820/- 807/6 870/- 860/-' El. Zinc (pf.) 34/- 33/- 39/ 39/3 Wilsons C't. .. 34/- 32/6 48 - 46/3 Martha . .. Blackwater . - 29.- .-9/Mt. Lyell .. 17/4 16/3 23/3 23/3 •Buyers. tEx dividend. Trend of Dealing

The trend of dealing over the week was Government Loans.—Bonds, 15/1/40, 4,, £lOl 10s: ditto, 15/2/46, 4. £105; ditto, 15/6/sa, 4 £lO4 15s (3): Stock, 15/5/38-52, 31, £lO3, £lO3 ss; ditto, 15/1/40. 4, £lOl 10b (2) £lOl 15s (2) ; ditto, 15/2/40, 4, £lOl 17a fad (3) : ditto, 15/4/49, 4, £lOl 15s; ditto, 15/6/50, 4. debentures.—Auckland Harbour, 9/7/38, 4}, £lOl 10s; Auckland Drainage, 1/11/39, 4|, £lO2 10s; Amalgamated Brick, 1/3/44, 71. £103: Mount Eden Borough, 1/4/55-60, 4}, £105; New Zealand Farmers' Co-operative, 31/1/45. 45. £9O 10s. Banks.—Commercial of Australia, 19s 19s Id 19s 2d, 19s Id. 19s 2d, 19s 3d; ditto, pref £9 8*; English. Scottish and Aub tralian, £6 5s 3d, £6 5s 6d: National of New Zealand, 70s 9d (2). 77s (2). 77s 6d (3), 77s 3d 77s 6d; New South Wales, £34 10s (5); New Zealand. 48s (Id, 49s 6d (4), 49s 9d (2), 49s 6d, 49a 3d. 49s 6d; Union, £9 ]9s 6d; Insurance.--New Zealand, 61s 6d (2), 63s 9d (ex dividend); South British. 955, 96s (5). Loan and Agency.—Farmers' Auctioneering (B pref.), 21s 6d: Goldsbrough-Mort. 33s (2), 32s Ud: Mortgage Corporation. 4s lOd (2)'; Traders' Finance (7a Od paid), 4s. Coal.—Renown, 9a 7d; Taupin. 17s (2): Weetport-Stockton. Is 5d (2), Is Gd (2). C as.—Auckland. 25s Od. 25 s 8d (3). Shipping.—Northern Steamship, 7s (2). Timber. —Kauri, 21s fid, 24s 4d, 24s Gd, 21s 7d (2). 21s 9d (2); Tuupo Totara, 9s lOd (2) 9s od. Breweries. —Dominion, 19s 3d (2): New Zealand. 53s (2), 53s 3d. Miscellaneous.—Australian Iron and Hteel (pref.) 265; Australian Glass, 87s 6d (3). 88s; Broken Hill Proprietary, 59s 9d, 59s 6d .2). r,93 3d (2). 59s 9d; Bycroft. 50s (2): Consolidated Brick. 10s 9d. 10h lOd. 10s9d (2), 10s lOd; Kleclrolytic Zinn, 30s (*); ditto (pref) 395. 39s 3d (2): Farmers' Trading. Ps 3d (3), 8a 2d (2): ditto (B prof.). 15s 9d (o) • G J Colos, 765. 77s 3d; DunlonPer'driau. 15s 9d: Maeky. Logan. 19s 6d: New Auckland Laundry. 21s: New Zealand Newspapers. 3Hs *>d; Northern Roller Mills H"s 9d 3?s (id. 27s 6d (3): New Zealand ■Refrigerating (10s paid). 10s 10d; Wilsons Crment, 43s (3). 47s 9d, 46s 3d; Woolworths (N.Z.). pref., 38s Od. _. Mining.—Alexander (15s paid), 10s 9d; Bi<? T ?iver. 2s; Golden Dawn. 3s Id; King Solomon, 3s 6d: Loloma. 255: Mount Morgan, 18s 3d. 18s 2d, Iqsl q s Id; Mount Morgan Devplomn'ent 4s: Ne«- Crown, 2s 3d; Plneer £5 7° r, fl: Waihi Investments. Its (2). Unofficial List.-British and Dominion Investments. Ps; Napier Woollen. 20s; Woolworths (Sydney). £6 9a 3d. f6 9s 6d. £6 8s; ditto (West Australia), £9 10s.