GLOOM IN MARKETS.

Stratford Evening Post, Volume IV, Issue 139, 25 May 1936, Page 7

GLOOM IN MARKETS.

DEPRESSING TREASURY SPEECHES. Fear 01 War Almost A Fame. BAD WEEK IN BRITAIN. T V* I’*l'i '} 1»i )' 1’ J V* . ; *» v Press Association —Copyright. London, May 23, Gleam appears to have settled on the markets, accentrated by Mr. Neville Chamberlain’s warning that public expenditure was likely to continue to increase. Gilt-edged securities have not the stamina to resist the depressing speeches from the Treasury bench and have consequently shown fractional declines. Persistent slipping of corporation stocks continues, and the chilly reception accorded recent loans was due to the undercurrent of belief that the cheap money period is ending for investors. The News Chronicle urges the Treasury and the Bank of England to check the tendency toward higher interest rates and points out that the supply of bank money has not increased in the past 18 months to keep pace with increased production and the rise in tire price level. It says the authorities can still act safely without fear of inflation. The general dullness has spread to industrials. The traffic index of cable and wireless showed a decline compared with last year, offsetting the favourable impression made by the accounts recently issued. Some selling followed Mr. J. C. Denison-Pender’s intimation that there was no present prospect of a capital rearrangement including provision for preference arrears. There is little business in other industrials, many of which have been slightly marked down. Investors are keeping out of the markets, preferring to wait and see how the cat jumps. The Franc. Though nervousness regarding the franc persists little business is being done. The Economist expects the drain on funds from Prance will recommence after the present French holidays. The authorities are leaning more in the direction of exchange restrictions in which, the Bank of England is unofficially cooperating, but it is becoming more difficult than ever to predict a short-term gold bloc. Spot tin fell below £2OO a ton for the first time in three years, and other base metals also dcch'ned. The International Tin Committee will meet on May 26 to decide the quota for the third quarter. Despite Bolivia’s desire for her quota to remain unchanged it is expected it will he slightly increased. Cor. per is lower, despite the improved statistical position, owing to the impression that consumption has recently fallen.

Although fruit prices are still low in consequence of heavy arrivals the market is tending firmer. The annual report of the International Labour Office, one of the most outspoken ever issued, points out tiiat much of the remarkable increases in the output of pig iron and steel and the activity in the chemical, automobile and coal industries in Germany, Japan, Italy, Britain, Czechoslovakia and elsewhere is due to rearmament and there is therefore sinister. Many countries have cut down imports of materials required for normal economic activity. Unemployment has not decreased in France, Holland or Switzerland, and even in Britain and America exceeds the pre-depression level. International trade is still perilously restricted. The grea.fst obstacle to the restoration of confidence is now not economic but political. Fear of war has become almost a panic. The report urges the holding of a new economic conference.