SHARE MARKET

Timaru Herald, Volume CXLII, Issue 20611, 28 December 1936, Page 14

SHARE MARKET

THE YEAR REVIEWED RECOVERY OF PRICES The Stock Exchanges finished their work for the year on December 23 to resume after the Christmas vacation on January 5. Business throughout the year has been very good and in several weeks records both for the number of transactions and value of scrip sold were established. As the Dominion Exchanges are closely allied to those of Australia and London the conditions ruling in those centres are quickly reflected in the local markets. The rapid recovery that Britain has made during the last two years from the effects of the depression has enabled an Increasing number of businesses to show profits which were widely distributed. The devaluation of the franc and the stabilisation of the currencies helped greatly to inspire confidence in the investment market. The rise of the base metals to values they have not known for years brought an immense amount of money to Australia and though New Zealand has few mines of great value yet a large number of investors in this country are getting handsome dividends from the shares they hold in the Commonwealth companies. The rise in wool is being reflected in the widest possible manner and Joined to high prices for meat is able to assist many people in agricultural and pastoral pursuits. The outlook generally is brighter than it has been for many years. Banking During the last few weeks bank shares have been freely bought by investors who look for capital appreciation and higher distributions of profits. Some of the banks have increased their dlvedends but they are still small compared with those of 1929. The two New Zealand institutions—the National and the Bank of New Zealand—suffered a serious decline as the result of the monetary policy of the Government but they are showing signs of recovery. Those corporations whose main business is in Australia are recovering much of the ground lost during the depression and are showing higher profits. Interest rates are hardening in the Commonwealth and advances are more difficult to obtain at an increase on what was being paid for them early in the year. Indications are not wanting that bigger business on more profitable lines is likely to come to these financial companies and that they will be called on to help the development of many new industries and establish more firmly those already in operation. Insurance The shares of the Dominion insurance companies were eagerly sought in the early months of the year but later there was a lull in the demand due to the fear that the extra taxation Imposed by legislation would make a serious inroad on profits. In the closing weeks values were steady for New Zealands at a shade over 60/-, Standards at 60/- and Nationals a little over 18/-. A keen demand set in for South British, in expectation of a bonus issue, at 93/- without sellers.

Loan and Agency The rise in wool and the price of lamb and mutton sent up the scrip, of the pastoral companies to higher levels. Dalgetys increased the dividend to 6 per cent., and the shares are firm at about £lO/10/-. Goldsbrough Morts are steady at 36/6. National Mortgage A issue had sales at over 50/-. N.Z. Loan and Mercantile, ordniary stock, realised £35. Breweries Brewery shares have been very popular with investors throughout the year. A great increase in the output of beer is confidently anticipated. New Zealands have been steadily rising and

closed strong at up to 54/-. Staples had several sales in the closing days and were very firm at 38/7 to 40/-. Dominions had a phenomenal rise in recent months and sold at 40/- ex div. which has been increased. Timaru’s latest distribution of part of the liquidation dividend caused sales at 2/8. Westlands ,10/- paid, are wanted at 15/-, as are Dunedins at 20/6 for fully paids. Frozen Meat The balance sheets, so far published, indicate that most of the meat companies have completed a fairly good year. N.Z. Refrig, paids are selling at near 20/- and the contribs at 9/6. North Canterbury has now got into a dividend paying position and shares are wanted about 36/- after sales at over 42/-. Waitaki Farmers are doing well and £4 does not tempt holders. Canterbury Meats are between £9/10/- and £lO for ordinary. Miscellaneous The most active section of the Stock Exchange business has been that dealing with industrial shares. Throughout the year they have held the distinction of being the most popular of investments. The rise of chain store organisations, a comparatively new development in business, furnished speculators with a measure of making money rapidly. The number of new flotations of these companies in the Dominion and the Commonwealth will tend to bring about intense competition and there is a likelihood that the huge dividends that several have paid, besides bonus distributions, will be severely curtailed. The big manufacturing companies of Australia have experienced a most successful year due to increased spending power of the people and to the protection which local industries enjoy. In New Zealand the Industrial concerns have not been so successful. Recent legislation which entailed large provision necessary for income and land tax has cut into profits and restricted expansion, but there is no doubt that progress is being made and costs of manufacture will be cut down and adjustments made that will en.-ble new conditions to be met. The number of companies that is starting fresh industries is a sign that confidence in the future of the country to sustain secondary industries is growing. Mining Speculation in the shares of gold mining companies has not been brisk at any period during the year. Several disappointments had to be recorded, and there were few bright spots to illuminate the reports of many of the dredging ventures. The large machines that are operating for overseas companies give promise of winning handsome returns, and considerable capital is being invested in Central Otago and Westland by British and Australian syndicates. As the areas to be worked have been thoroughly tested, a good idea of the value of the claims is already known. In the closing weeks some of the West Coast dredges put up records which, If they can be continued, must hearten investors and cause a run on the shares. Maori Gully, which fell to 6d, produced over lOOoz. in the last week. Gillespie’s Beach, which has been fairly consistent, won 106 oz 9dwt for 214 hours’ work. Shares sold at 1/5. Worksop had 117 oz and the scrip is steady about 1/10. Argo got 150 oz for 10 days and shares are firm at 1/9. Australian Mining The high price of base metals during the last few months caused by increased consumption and the armaments race, made the shares of the big Australian mining companies good property, and resulted in higher prices for the scrip than has been in evidence for many years. All Broken Hill companies shared in the increase. Mount Lyell, ex div, closed at over 38/-. Broken Hill South, 5/- paid up, was up to 44/-, and Broken Hill North, 5/paid, sold at over 75/-, Electrolytic Zinc in the closing days spurted to 50/- for the ordinary and to 52/2 for the prefs. Mount Morgan has been disappointing during the last few months, but great confidence in its future is expressed by the directors and management. The new plant is expected to be operating early next year. PRICE OF RABBITS United Press Association—By Electric Telegraph—Copyright LONDON, December 25. Rabbits are quiet; first, large ex store nominally 21/-.