BRITISH TRADE OUTLOOK.

Timaru Herald, Volume CXXV, Issue 18618, 14 July 1930, Page 9

BRITISH TRADE OUTLOOK.

Heavy Shrinkage In June. EFFECT ON STOCK EXCHANGE. United Press Association—By Electric Telegraph—Copyright (Received July 13, 5.5 p.m.) LONDON, July 12. The June Board of Trade returns can only be regarded as disquieting, for they show a decrease of exports for the first six months of the year of £65,000.000, and a decline in imports of £63,000,000, compared with the same period in 1929. The outstanding feature of the export trade is the heavy fall in the sale of cotton and woollen goods, of which practically all countries are smaller buyers, especially Germany, France and the Eastern countries. Another feature is the reduction in exports, especially luxuries to Australia. For instance, the motor cars exported thither in June were only valued at £l5O, compared with £11,700 in June of 1929. World-Wide Over Production. Lord Inchcape, at a meeting of the P. and O. Banking Corporation, gave what may be accepted as the main reason for the decline in commodity prices, when he attributed it to world-wide over production, particularly of raw primary materials. He instanced wheat supplies, estimated at 1,500,000,000 bushels, compared with 1,455,000,000 last year, and the world’s visible supply of cotton was 1,200,000,000 bales higher than last year, arguing that until this surplus of supplies over demand is overtaken by the world’s consumptive capacity, we cannot expect to see the stabilisation of prices sufficient to restore the confidence, which has been disturbed by the severe depreciation that occurred. Stock Exchange Outlook. With the trade of the country in this unfortunate condition, it is satisfactory that the tone of the Stock Exchange is confident, and investment securities show considerable strength, British funds especially being in demand, and prices tending upward. The rally of Australian Government stocks has been well maintained, and they are still meeting with good inquiry in some quarters. The improvement is attributed to the bankers resolution in favour of Empire free trade, for the commencement of the rise followed immediately the publication of that document, but there is no doubt that the better feeling has been largely induced by the news of Sir Otto Niemeyer’s visit, and the expectation that discussions with Mr Scullin will lead to an improvement in the economic and financial situation.

Commenting on what he calls “Mr Scullin’s ruthless budget,” Mr Otto Niemeyer says: “Other means may be devised to circumvent the great difficulties that face the Commonwealth.”

Improving Wool Position. Discussing the wool position, the “Yorkshire Observer” takes an optimistic view, and says: “Before the London sales opened, a movement in the buyers’ favour was expected to be much more drastic than has occurred. Accordingly the effect of the Coleman Street test has been to create a feeling of greater confidence, and banish the fear of any marked departure from values. Opinion is now freely expressed that the recent depression influences having had comparatively small effects upon that sensitive instrument—Coleman Street sale room—its latest record is a distinct encouragement towards the view that wool is all right, and may be regarded as having been hammered down as far as it is likely to go, at afiy rate this season.