MORE CHEERFUL TONE.

Timaru Herald, Volume CXXXIV, Issue 18845, 7 April 1931, Page 9

MORE CHEERFUL TONE.

London Stock Exchange. OUTLOOK FOR PRODUCE AND FINANCE. United Press Association- -By Electrlo Telegraph—Copvright LONDON, April 4. The Stock Exchange broke up for the Easter holidays in a much more cheer- , ful frame of mind than seemed likely a week ago, when the gilt-edged market I was upset by Mr Lang's repudiation i threats. State of Stock Market, j Last week’s satisfactory news from ! Australia about Wednesday’s payment ! of interest on New South Wales stocks, | however, had an immediate salutary I effect. Prices improved all round, j though business was not expensive, i A further incenture to bullishness was I found in the fact that the Budget i deficit will not be so large as was at j one time feared, also the improvement ! in the gold position, and large dividend disbursements on April 1. ' Yet another good factor was the i revival of hopes that the Chancellor | of the Exchequer will find it possible to carry through a successful war loan conversion scheme before the end of the year. Industrial shares had to bear the brunt of several unpleasant shocks lately, notably the poor trading reports of important companies like the Cunard Line and the United Molasses Limited. The latter had a disastrous year, showing a debit balance of £913,000 compared with a profit of £972,000 the previous year. Tobacco shares also reacted on the expectations that the Budget would impose an additional duty, and rubbers were weak in price. Despite all these unfavourable influences there has been no great pressure to sell. The tone of the market is quietly hopeful. Butter Market. Heavy quantities of butter are coming forward from Australia and New Zealand, while Continental production is increasing. Prices for all descriptions moved in buyers’ favour, and it seems likely that they will go still lower. Danish is particularly weak. Its price has fallen 34/- per cwt since February 14. Commenting on the position, the newspaper “The rfrocer” says: “Various reasons are put forward for the decline. It is difficult to assign the real cause. It has been suggested that there has been some pressure to sell colonial butter by holders who bought cheaply on c.i.f. terms, also the demand for Easter requirements both here and on the Continent was below expectations. This may be attributable to bad trade generally or the fact that the supplies exceed requirements. One satisfactory aspect of the market is that consumption for some months has been on a very huge scale, thanks largely to cheap retail prices. The stocks in cold store on March 21 were estimated at 290,727 boxes, compared with 622,018 boxes a year ago. Prospects for Wool. Regarding the wool position, the Bradford correspondent of the “Yorkshire Post” writes that there has been recently more pronounced indications of a determination riot to follow the upward course of wool values until it is easier to secure compensating prices for yarns and piece goods. There is a limit to the power of raw material to dictate prices, and it is felt that for the time being it has largely exhausted itself in this respect. The excitement in the raw material market during the last few weeks has not been carried into the piece goods department, and it is surprising indeed to what a restricted extent there has been any response by purchasers of fully manufactured materials to the rapid advance in wool, particularly the finer quantities. The total volume of business in piece goods has not developed as one might imagine from the recent scramble for wool, and competition for a share in what has been given out has been so keen that makers of piece goods have not found it necessary to pay more than a very small percentage of the increased cost of raw material.

During the company promoting boom of 1928-29, when shares of many more or less bubble companies were foisted jon an unsuspecting public, it was a ! common thing to announce that issues i were oversubscribed, whereon really the public response had been small. Such lying announcements will be impossible in the future, as the Advertisers’ Association has advised editors to refuse over subscription announcements unless accompanied by a statutory declaration signed by the director and secretary of the issuing company, stating that the applications exceeded the number of shares available for allotment, and were accompanied by appropriate remittances.