LOWER SHARE VALUES

Taranaki Daily News, 22 August 1930, Page 16

LOWER SHARE VALUES

MARKED DROP IN YEAR. MARGIN OF MANY MILLIONS. An interesting, table- has .been compiled by the Mercantile Gazette to show the decline that has occurred in the value of shares during the past 12 Figures are adduced indicating that the market value of the shares of ten banks has depreciated in the course of the year by £27,000,000 and wit'll nine miscellaneous companies added the loss that has fallen on investors since last July is brought up to £53,000,000. This decline, it .is pointed out, was commenced in the first place as a result of the collapse of the boom on the New York Stock Exchange in July last year. European markets were disturbed by the transfer of credit and depression was caused on the London Stock Exchange and Continental Bourses, which in due course affected New Zealand and Australia. Shares began to recede in value, but the chief cause of the trouble at this end of the world was the result of the decline in the commodity price level following the New York slump. Primary exports were badly hit and had since shown only a partial recovery in price. The consequence was a contraction in national revenue, causing an unprecedented disturbance in economic conditions.

It was the drop in commodity prices that wrecked stock exchange values and it would .be difficult to point to the shares of any one company that had not contracted in value. Several banks and companies operating in New Zealand and Australia reduced, their dividends and that in itself was, sufficient to depress shares, but the drop seemed to have gone further than it should because of bear operations. This latter had become such a dominating factor-in depressing shares that the Stock- Exchange authorities in Australia had been forced to take action to minimise the effects 'of time bargains. A comparison of actual sales in July, 1929, with the level of transactions last month was made as follows: —

Since the prices have been taken out values have varied slightly.- The values are fairly approximate. The depreciation in the values of bank shares in the aggregate is as follows: — Aggregate . Banks Depreciation Aus. Bank Com £1,490,400 Bank of A'asia 2,450,0Q0 Coin. Bank Aus. 3,106,420 Com. of Sydney :..c 2,814,973 E.S. and A 2,525,000 Nat. of A'asia 2,770,000 Nat. of N.Z. 860,000 Bank of N.Z. : 1,031.250 Bank of N.S.W. 5,831,250 Union Bank !....£ 4,100,000 Total £26,959,293 The values of a group of miscellaneous companies, mostly with head offices in Australia, and the price movements were

There have been further movemen is since the above table was prepared. Colonial Sugar, for instance, are now down to £37 12s 6d. The aggregate depreciation of the same companies was stated as under:— Aggregate Company Depreciations Dalgety and Co. £1,3'a0,000 Goldsbrough Mort 1,800,000 British Tobacco *' 4,775,094 Colonial Sugar 4,606,575 Huddart-iParker 262,500 Australian Glass 825,7'98 Dunlop Rubber 2,775,910 Burns-Philp - 787,500 Tooth's Brewery 9,063,21® Total • ® 26,250,790 The issue of new capital is a factor that must bo taken, into account in at least two cases. The Commercial Bank of Australia and Goldsbrough Mort both made hew issues during the period under review,' ....

Price. Price. DoJuly '29 July '39 cline. £ s d £ s d £ 8 d Aim. Bank Com. 1 ie 0 1 2 6 0 13 6 Bank. A'asia 14 4 0 12 0 0 2 14 0 Com. Bank Aus. 1 10 0 1 2 0 0 8 0 Com. Aus. (pref.) 7 9 6 6 12 0 0 17 6 Com. Sydney .. 27 2 6 19 14 0 7 8 6 E.S. .and A. .. 8 10 9 5 19 6 2 10 6 Nat. ’A'sia, £ 10 ID 15 0 14 7 6 5 7 6 Ditto. £5 .. 9 10 0 6 19 6 2 16 6 Nat. of N.Z. .. 7 0 0 5 18 6 1 1 6 Bk. of N.S.W. 51 15 0 36 4 0 15 11 0 Bank of N.Z. . , 3 1 6 2 16 0 0 5 6 Union Bank .. 15 12 ■ 0 11 5 6 4 « 6

given as follows: — Price. July '29 Price. July '30 Decline. £ s d £ 8 d £ s d Dalgety 15 5 0 10 15 6 4 10 0 Golds. Mort .. 2 0 9 1 8 9 0 18 0 British Tobacco 2 8 6 1 15 9 0 11 9' Colonial Sugar . 57 15 0 42 0 0 15 15 0 Huddart-Parker 2 5 0 1 18 0 0 7 0 Aus. Glass .... 2 15 8 1 17 6 0 1-7 9 Dunlop Rubber 1 7 9 0 13 0 0 14 9 Burns-Philp .. 2 7 0 1 10 6 0 10 6 Tooth's Brewery 3 2 6 1 10 3 1 12 3