LONDON MARKETS

Wanganui Chronicle, Volume LXXXII, Issue 19478, 22 December 1925, Page 10

LONDON MARKETS

REVIEW OF TRADE MONETARY STRINGENCY. END OF RUBBER BOOM. LONDON, Dec. 19? The boom in rubber shares on the Stock Exchange has come to an end as the result of a sharp fall in the price of the raw commodity. There was a brief revival of activity on the slight recovery in the price of the raw article, but to-day’s further fall of plantation to 45d may be regarded as the coup de grace to tho boom for this year. Other departments of the Slock Exchange, notably gilt-edgeds, have been rather depressed owing to tho monetary stringency, and the fear that the bank rate might bo raised, but markets improved considerably when Thursday passed without an advance in the rate and monetary conditions became much easier.

There have been a considerable number of new capital flotations, chiefly industrial, during tho past fortnight, the total amounting to about £16,000,000, of which £12,000,000 is new money. Several of these were rapidly over-sub-scribed, but several artificial silk companies met only a very poor response from the public. The French Franc. The French franc has provided thrills in the foreign exchange market this week, for after rising to over 135.00 as the result of rhe uncertain political and financial situations, it improved yesterday to 127.25 on the announcement cf the textile industrialist loan scheme, and to-day it is still better at 125.25. It remains to be seen whether this rapid appreciation is justified, for the industrialists’ scheme is only in the pro- , posal stage, and, further, there is tho question whether the United States, where presumenably it is intended to raise the money, would grant any new loan until France has settled her war I debts. The forecast of the French wine vintage prepared by tho newspaper “Moniteur Vinicole” states that the yield is considerably bettor than anticipated in September, the improvement being attributed to tho favourable weather experienced in many districts in October, which had a good effect on the vintage, and to some extent compensated for the serious losses in other departments. The total yield is now .estimated at 63,034,000 hectolitres, a decrease of 5,306,000 compared with 1924. The Algerian ana Tunisian yields bring the total to 75,134,000, so apparently France will have sufficient wine to meet ail demands. The Wool Position. Commenting on the wool position, Mr H. Dawson writes: “Some hopeful features are beginning to emerge from tiie recent perplexing conditions. Tho tension of being caught short of supplies for immediate needs is relieved, and more wool is near at hand. Consequently users are watching carefully for the best opportunities, for replenishing. Ail this indicates a return to more normal and safe trading after a very disturbed period. There is la strong undercurrent of demand and a general anxiety to make early operations at a safe price, which appears in crossbreds to have been reached. The lower levels of values is encouraging a better turnover and more machinery is running. England is again becoming a more important factor in the world’s markets. In short, the worst phases of the disastrous year just closing are passing away, and after the most severe crisis of this generation the wool trade emerges still virile and strong. Butter. The slight improvement in the demand for butter a week ago proved only a flash in the pan, and the market relapsed into a state of apathy. This is largely due to the weakness of Danish, which has slumped owing to the cessation of German demand. On Thurs day the Copenhagen f.o.b. price w'as lowered to 170 s, equal to about 176 s landed here, but it has since recovered about 10s. Retailers are now reducing their price, and, with best butter at Is lOd and 2s a pound, it is hoped there mar be an improvement in consumption which has undoubtedly been checked seriously bv the high retail prices.