SOBERING DOWN.

Wairarapa Age, 4 May 1937, Page 5

SOBERING DOWN.

LATEST PHASE ON LONDON STOCK EXCHANGE. LIQUIDATION APPARENTLY SPENT. SOME NIBBLING FOB BARGAINS. LONDON, May 2. There are signs already that the share markets will have a more sober aspect next week. Liquidation seems to have spent itself, but it would be unwise to prophesy. Thursday’s settlement is awaited with some anxiety, as heavy differences will have to be met. If the settlement passes without trouble it will open the way to a slow’ recovery on a broad front. Investors are already nibbling for bargains which in more normal times would be considered too good to miss. The financial Press is advising cautious purchases, stressing the attractiveness of certain industrials and forecasting a sharp recovery in rubber shares because dealers are short of stocks of the raw material. “The Economist” consider that the Chancellor of the Exchequer was undoubtedly right in. emphasising that the effects of the profits tax had been exaggerated. Nevertheless, normal conditions will be impossible until the tax uncertainties have been cleared up. Present quotations of many sound shares are the result of fear rather than carefnl weighing of investment factors. Nevertheless there is scope for a further all round increase in earnings of industy, as the scale of the past four years is becoming narrower as costs are rising and labour is restive. Opportunities for increasing profits from some developing industries still exist, but it would not be surprising if the major rise in the value of equities is a thing of the past.

EXPORT TRADE.

QUESTION OP THE OTTAWA AGREEMENTS. MORE FOREIGN BUYING DESIRED. LONDON, May 2. One result of the present heartsearching has been to focus attention on the importance of maintaining Great Britain’s export trade. There is a growing feeling that manufacturers should not allow re-armament orders to lead industry. This attitude may cause a disequilibrium, drawing off productive activity from the export trades upon which Great Britain’s prosperity rests. The movement in favour of revision of the Ottawa Agreements is increasing, even the Government realising the importance of widening the area of world trade and lowering the tariff barriers in order to encourage foreign countries to buy more British exports. DEMAND FOR COMMODITIES. GENERALLY STRONG POSITION. LONDON, May 2. Commodities have suffered from heavy selling, but they have withstood it reasonably well. The “Financial News’ 1 considers that the long-term trend of commodities should be definitely upwards, though from now on there will be a more selective OUTLOOK FOB WOOL. PBICES MAY GO STILL HIGHER IF RUSSIA COMPETES. LONDON, May 2. The strength of the wool market is especially notable. If Russian competition develops next week prices may go still Higher.