TRADE AND FINANCE

New Zealand Times, Volume XLVII, Issue 10985, 22 August 1921, Page 5

TRADE AND FINANCE

LONDON CHANCE DEPRESSED DECLINES ATM* Alt ENT IN MOST SECURITIES. COMING AUTUMN PERIOD. B- Telegraph—Press Assn. —Copyright. Australian am! N.Z. Cable Association. (Received August 21, ”- ° P- n 1 - LONDON, August 20. The Stock Exchange lias had a severe fit of depression, during the last tew da vs,- The gilt-edged market is sufterin- from the unsatisfactory position of "the national finances, and the indefinite outlook of Irish affairs, and declines are apparent in most securities. One bright spot is th© colonial corporation market, where a fair demand m apparent at late prices. Industria. shares have been influenced by the fact that many companies have either passed or reduced dividends, consequently many shares are marked down A distinct weakness lias developed wlmrever selling pressure has been exorcised. Oils have been particularly bad. and at one time a panic appeared likely owing to the avalanche of Soiling. Tliero Ims been a sharp rebound from the lowest, but the market remains extremely nervous. The exchange position so fair as Australasia is concerned shows little change. There seems no probability of a realisation of the fears entertained in many quarters that the autumn would see tho recurrence of the serious stringency which marked the autumn of 1920. The banks certainly are not offering anything like old-time facilities. Indeed, they are doing all possible to discourage exports, except of necessities, but this policy is working well. The position is improving steadily, nud confidence is returning. This is greatly helped by shipments of wheat, wool and butter, which are all realising good prices. If these are maintained it seems there will he no difficulty of weathering the awkward autumn period, which caused so much anxiety last year. AUSTRALIA’S .SUPERFLUOUS GOLD. In connection with the exchange question it is interesting to note the “Financial Times’®” criticism of Mir Hughes’s address to hankers. Air Hughes referred to ’ ustralia as holding gold bullion am: -uting to over 76 per cent, of outstanding notes. The “Financial Times” considers this backing fax beyond what is necessary. Mr Hughes dwelt on the value of Australia as a consumer of British exports. The “Financial Times” nsks why then did Mr Hughes refuse to release# some of this superfluous gold a year ago when British shipments to Australia were held up by the deadlock in connection with exchange?

TRADE RECOVERY EXPECTED. , Although present trade conditions, oxoept with Germany and other countries which are specially favoured by the exchange position, afford little ground for optimism, many financial authorities believe a recovery from depression is not far distant. The newspaper ‘ ‘Statist’ ’ says that, following unmistakable indications, “universal absence of financial stringency after one of the severest periods of financial strain that has ever been witnessed, the decline in money rates, the improved speculative sentiment in Jap%n and the United States, and the reaction in commodity prices,” strengthen the belief that business conditions are on the eve of a recovery from the recent depression, and the coming months are likely to bring more hopeful prospects. GERMANY’S BOOM. The trade boom in Germany continues. Tho condition of all industries, except the chemicals, machine and! shipbuilding branches are all extremely good. The iron and steel trades, particularly .bar iron and wire, are very busy. The textile branches are enjoying a sudden and quickly-increasing prosperity. .The clothing, tailoring, millinery, and underwear industries have more work than they can execute, and many will be unable to fulfill orders, owing to materials not being available. Scandinavia and Holland; have sent large orders for woollens to America, ordering knitted goods. Yorkshire newspapers state that German manufacturers are ao riially selling to the wholesale export houses in England both men’s and women’s wear fabrics at .less than they can be made at Bradford to-day. They are even offering many months’ open credit to induce business. THE FREIGHTS AIARKET. The reduction in the., cost of hunker coals from about 41s bo 26s for Tynea, 30s for South Wales has caused a weakening in wheat freights. Some owners are sending and are nulling to send steamers in ballast, hoping for further reductions in bunkers to enable them to run profitably, so that rates declined from 75s to 70s, at which there were several fixtures after 73s 9d and 72s 6d had been paid. Charterers have noiK filled requirements, and will not consider anything over 655.