INVESTMENT YEAR

New Zealand Herald, Volume 81, Issue 25084, 23 December 1944, Page 5

INVESTMENT YEAR

SUBSTANTIAL FUNDS SEEKING AN OUTLET Auckland sharebrukers Jiav« concluded an other busy year. All the principal factors, inducing Stock Exchange dealings, have bec " in their favour. There lias been an übunriaiiie of surplus funds available for community expenditure, accompanied by a restriction in uie main avenues ot investment —namely, imports, various forms of industrial maintenance and expansion, and mortgages. An intaiigioie, but highly important factor, the confidence oi potential investors in the country's future, has had no serious setback. , According to the latest returns, there was in the six trading banks of the Dominion oil October 30 an aggregate of deposits totalling fc 114.80(5,332. This sum included X' 83,81, clawed as "free" and available for iiiiniejlialf expenditure, while the balance designated as "fixed" could lie freely drawn against at the request of depositors In addition, there was .1 credit to depositors in the havings hanks oi over X'TOO,iKio.ixiii With such a sum available, it i« not surprising that the demand for securities on the Stock Exchange was exceptionally strong, and the majority of the brokers record a heavy turnover. All outstanding event of the year was the successful flotation of (he Victory Loan ot X' 10,000,000, thu Dominion's largest financial undertaking io date. This brings the total amount raised by way of loan since the war started to 4:133,000,0<)0. Even with this heavy addition, tho unantity of gilt-edged securities available for dealing has not proved beyond the market's capacity, although a slight decrease in prices has come as a natural corollary to the exceptional size of the offerings. A year ago, an investor in Government stocks had to be content with an average yield on his investment of about 13 Ms per cent per annum; today the return in from £'l Is to £'3 5s (id. Levels of State loans at the close of the past three years are:— 10.1-2 10-13 li>ll £ X' * Stock, 15/9/17, 2'/ a . . OS'/a OS 'OS/ Ditto, 1/10/53, 2% . 94 Ol'/s Oi 1 /. Ditto. 15/0/52-33, 3 . 99 1 /-, i)S Y' Ditto, 15/5/53-56, 3 . 00 OSV B 07'/ Ditto. 15/9/57-00 3% 101 Va 101% 100* Ditto, 15/1/53-37, 3'/j 101 V, *103% 103 1 / Ditto, 15/9/52-55, 4 106 100 10-1 Banks and Insurances Bank shares have for years enjoyed t special popularity with investors by reason o their very substantial reserves, providing un impeachable security, and their steady earnilij. powers. Values in the section steadily rose ii ■sympathy with the general trend until Jul: am! August b.\ which time New Zealands liai advanced to 11;s 3d, New Sunlli Wales to L'3B I Unions lo is iis, Australasian lo CO 12s. all* Nationals N.Z. to 55s (id. in the last few- months, political influence, have been felt. The possibility that th Federal Government may introduce icgi.slatioi affecting banking brought uneasiness to id vectors, and prices have shown an all-rouiu easing. In New Zealand, the Labour Part: conference resolution urging the State pur chase of privately-owned shares in the Ban! of New Zealand dominated the market ii recent weeks. Values have fluctuated accordiru to the varying views of those who believe tha tho siiares, if taken over, will be paid for o: the basis of tho bank's assets, and those wh consider that recent market prices will b accepted as the determining factor. It has bee' estimated that on an assets basis the share would prove to be worth from JL'3 lo £-1 . share. Insurances led the market in the first hnl of the year and prices soared lo record height. l wiving a yield on outlay to investors of 2per cent per annum in the case of Soul British and 2 1-5 for New Zealand*. Moweve: a warning note sounded by (he chairman n (lie Now Zealand company at its annual ineel irig that the exceptional receipts of recen years must be viewed as abnormal, had steadying effect. From July onward price steadily dropped until, with a better rehir available to purchasers, the market gradual! improved, and during the present month agai presented a firm front. End-of-the-year levels in the two section compare as follows: 1012 10 13 10 It £sd£ a d £ s C. Bk. Aus. 0 10 0 0 17 8 0 17 Bk. N'.S.W. 30 10 O* 31 2 0 34 0 N.Bk. N.Z. 2 S 0 2 11 0* 2 12 Bank N'.Z. . 2 0 0 2 3 0 2 5 * Union .. 7 12 0* 732 0* 8 4 < N.Z. Jnsur. 3 17 O 4 10 0 4 0 1 S. British .3 7 3 3 l(i 3* 3 17 1 Miscellaneous Securities In sympathy with the generally satisfac tory results, shown in the annual accounts o most manufacturing companies. industria shares were in keen demand. In the first hal of the year, many of the more favoured issue established new high levels and, althoug there was a slight reaction during the pas few months, values were well maintained. The shares of companies associated wit the primary industries were well supportei I showing little variation, even when the genera [ price trend was downward Brewerie reached and maintained high levels, whil I shares of woollen companies showed a market I decline. Shares of companies dependent direct! or indirectly upon a continuous coal supply notably Auckland Gas. Wilsons Cement an B.vcroft, were adversely affected during til period when coal deliveries were unsatisfactory The trend in New Zealand industrial share was as follows:—1912 1013 1044 £Bd£s d £ 8 d Kaiapol 0 19 4* 1 4 0* 1 2 9 Pukemiro . 0 17 0 0 18 0* '0 IS 3 Auck. Gas 0 7 2 0 7 1 0 7 6 Dom. Brew. 11l 0 1 10 6 2 5 0 N.Z Brew 1 15 0 1 IS 0* 2 3 0 Byeroft . . 2 0 6* 211 (>* 212 0 N.Z Pert. 010 0 1 2 9 1 4 9 Farm. Trad. 1 2 o 15 3 1 6 11 W'sons Gem. 018 I 010 1 018 3 W'ths (N'.Z.) Olt 10 OIS 3 .1 1 5 •Buyers. tSellers. Australian Companies There was a steady demand for all tin leading Australian stocks, with values showinf comparatively little alteration from tho highe levels reached (he previous year. Chain store; improved, and gains were recorded by G. J Coles and Woolworths (Sydney). Colonia Sugars continued the 1943 advance until tin shares touched £6O on August 1. Then fol lowed a gradual easing, which was aeceleratei when the directors announced a lower rate fo the interim dividend. ■> Closing prices of Australian stocks ovei three years are:— 1012 191.3 194*1 £ s d £' s d X' s d \C. I . . 2 0 (i* 215 0 217 6 Brit. Tob. 2 6 3 2 S O* 2 8 H' Broken Hill 2 1 3 2 -1 0 2 4 9 Col Sugar 52 10 0 5S 0 0 56 19 0 G.J.Coles 218 0 3 1 6 3 0 61 Electro Zinc _ „ „ „ „ (pref.) . 2 14 O" 2 16 6* 2 16 0 Mt. J,veil ,1 8 9 1 9 0 1 W'worths . 017 0 019 6 1 1 3 "Buyers. tSellers.