INVESTMENT MARKET

Evening Post, Volume CXXVII, Issue 117, 20 May 1939, Page 12

INVESTMENT MARKET

BUSINESS THIS WEEK

THE NEW LOAN

"Evening Post," May 20,

Values generally have held firm > this t'week, taking the share lists as a whole, but business continues sluggish. Excepting for a few specially favoured Australian issues, the turnover has been quite small.

The trend of export values does not inspire hope of any considerable amount of money from that source being available for investment. The rate of interest, 4 per cent.,, offered for the Government's latest internal loan of £4,500,000 and its terms, together with the new rate of interest of 4£ per cent, instead of 3£ per cent, as formerly for local body loans, may be taken as an unmistakable sign of the hardening of the price of money. / The new loan has received the benediction of the Stock Exchange and there seems to be no doubt .about its full subscription. But investors the world over are still uneasy in their minds as to the unsettled condition of international affairs and the turn they may take at any moment. Gilt-edged investments generally are extremely sensitive in these circumstances, consequently business in ttiem is small. In Australia the Loan Council-is expected to re-enter the local market- next 'month for. a public works loan on behalf of the Commonwealth and States of at least £7.500,000. This will necessarily reduce the amount of capital available for investment in other directions. The Commonwealth Government's year ends- June 30. The last of the loans for this purpose was issued in February and it was for £8 500,000. But little more than half of it was subscribed, although part of it was for defence. The rate was then £3 17s 6d per cent. It may have to be raised slightly for the next loan. The latest indication of the state of the money: market of Australia was the £1,000,000 loan .at 4| per- cent, for the Sydney Water Board.. The issue had a currency of ten years -.It closed with a little, less than half left with the underwriters. . .

GOVERNMENT LOANS. As from May fe, 1939, the Zh per cent. Government Stock becomes 4 per cent., maturing May 15, 1949-52, and will no longer be free of income tax. The amount of the loan was £ 2,300,0UU. Business in Government loans this week has been moderate as was only "to be expected with the new 4 per cent, issues open for subscription. Market opinion is in the direction that the total amount of the two issues, £4 500,000, can be comfortably absorbed at the improved rate of interest which is in line with the local money market, and which . may be taken to signalise a hardening of mortgage and other interest rates all round. The prices for Government loans a "year ago and prices at which business was done last week and at close of this w.eek are shown as follows: — April 29, Last This Per Tear. 1938. week. weefc. » cent. £ £ •* 3 .. 1939-41 9S 96% *96* / 4 ■■3% .. 1939-43 100% 98% 98% 3% •• 1953-57 98% 91% *90% 3%- .. .1938-41 102 *99 98% 4 '.. 1940-43 — *98% 98% 4 .. 1943-46 '102 99% 98% 4 .. 1946-49 102 98y 2 98% 4 .. .1949-52 '..— *98% —,' 4 .. 1952-55 104 98% 199% ♦Buyer. .' ' tSeller. Half-yearly interest is due on 4 per cent. (1955) June 15, .on 3 per cent. (1939-41) and 3£ per cent. (1953-57) on July 15. Half-yearly interest was paid on 3| per cent., 1941, on May 15, and sales were ex interest. Sales of Government Stocks and Bonds showing the range of prices this week were reported as follows: — 3* per cent. Stock (1939-43),' £98 10s. 3| per cent. ,(1941), £98 15s. 4 per cent. (1946). £98 15s. 4 per cent.- (1949), £98 10s, £98 15s, £98 12s 6d. £98 ss, and Bonds £99. DEBENTURE MARKET. Business in local body debentures was far from active and that not for want of sellers. Incidentally sellers of 4£ per cent. City of Brisbane Stock (1952) in Auckland quoted £109 but bailed to elicit a bid. The business so" far reported was as follows: — '■?' 4J per cent. Auckland Transport (1944-52), £99 10s. 4J per cent. Newmarket Borough (1952)," £102. Company debentures were slow of sale but business was reported in 6 per cent. Amalgamated Brick, Auckland (1944), at £100 and 4J per cent New Zealand Farmers' Co-op., Christchurch (1955), at £80 15s. BANKS, INSURANCE, FINANCE. Bank shares were in fair demand, but showed little change in price over the week, and they appear to be firmly held. The position of bank shares in the market during the week is seen-in the table following:-—

Low. - High. Close. £ s. d. £ s. d. £ s. d. Bank of N.Z 1 19 6200201 Bank of N.Z. D*l 70170169 Nat. of N.Z 2 4 0 2 4 6 2 4 0 Australasia .... 915 0 915 6 9la 0 Commercial 0 16 2 0 16 8 0 16 2 ES and A 5 40 5 4 0 5 40 Union 8 10 8 1. 0 8 1 0 Bank of N.S.W. . 30 10 0 31 5 0 31 5 0 Nat. of Aust.. £5 615 6 615 6 6 b 6 Sales of Commercial Bank of Australia 4 per cent, preference were reported at £9 10s. Buyers of Commercial Banking Co. of Sydney's shares offered £20, but there were no declared sellers. The National Bank of Australasia £10 shares had inquiry at £13, but sellers wanted £14. Insurance company shares were sparsely dealt in, but there was little or no variation in prices paid for shares in the two Auckland companies. Nationals improved from 15s 6d last ■week to 16s Id. Queenslands were in demand at 58s. Beyond sales of Goldsbrough Mqrts at 29s and United Building, Christchurch at 20s 3d, business was stagnant in the stock and station and financial sections of the market. Interest , was shown in Dalgety's with buyers at £6 10s met by a quotation of £6 17s 6d. New Zealand Loan and Mercantile (ord.) were inquired for at £-0. but sellers wanted £26 Abraham and Williams were in demand at 9s fad ana 16s 9d was offered for perpetual Idebenfure stocks, but there were no sellers.

INDUSTRIAL AND OTHER. New Zealand enterprises attracted a moderate amount of attention. In the coal section Westports had business at 20s and Pukemiros sold at from 16s 6d to 16s ,-9d weakling to 16s 3d. Renowns and Westport-Stock-tons ordinary shares had sales. Auckland Gas at 17s was the. only sale in gas shares; and Tarmgamutu at 13s 9d the solitary representative of .sales of timber shares. Investment in the freezing industry was confined to New Zealand Refrigerating at 15s 6d tor £1 shares and 7s for 10s paid. The New Zealand textile industry business included sales of Kaiapoi at 12s 6d. Wellington Woollen (pret) Were in demand at £5. Mosgiels sold at £9 7s 6d, and Bond's Hosiery had buyers, at 19s. Others were sellers. Wilson's cement, earn dividend, had kales at 18s. Consolidated Brick imbroved from business at 9s 6d to 10s. For sales of other New Zealand m-

dustrial shares reference is made to the list on the opposite page. ; RETAIL STORES. McKenzie's Department Stores improved with sales at 50s, rising to 50s 3d. Woolworths (N.Z.) kept at around 19s; Woolworths Ltd. held sales at 23s 9d -to 23s lid. Woolworths Properties commanded 27s 8d; and Woolworths (W.A.) sold at 86s 6d. G. J. Coles changed hands at 86s to 86s 6d, but yesterday at noon call sales at 765. were nbtified and-75s in Auckland. Why this fall? The rights to take up new shares of one for every five held were sold at various prices, 52s 6d being paid and simultaneously 49s 6d, closing at 51s 6d. AUSTRALIAN ENTERPRISES. Conspicuous in the sales this week were Broken . Hills, which maintained their advance of last week to 665. Sales were between 15s lid and 66s 6d and 59s paid for the contributing shares. Australian Consolidated Industries were a shade weaker at 37s 9d. Colonial Sugar, as last week, were sold at £51. British' Tobaccos hardened with sales rising from 51s 9d to 525. BREWERIES. ' An advance in prices paid for New Zealand • Breweries' shares was from 38s to 38s 9d. Dominion Breweries showed no change at sales at 345. Tooths had business .at 57s 9d. Swans were wanted at 29s 6d and Carltons at 655. Ballins (15s paid) had buyers at 9s 6d to 9s lid, with' sellers at 10s Id. MINING. Australian metal shares were fairly steady with Broken Hill South closing at 28s Bd, a drop of 4d on the week. Electrolytic Zinc ordinary sold at between 49s 6d' and 50s 6d,. closing at the lower figure; the preference made oss 6d. Mount ■ Morgans - improved with business -at from 10s 7d to 10s 9d. Rawang Tin reappeared m the sales, at 8S ' GOLD AND OIL. Lolorria Mines, Fiji, 'had business at 245. Martha sold at 11s and Waihi Investments at 7s sd. Other gold dredging and mining shares sold appear in the list. Taranaki Oils changed hands at from 5s 6d to 6s '6s, closing at 6s and £d paid for rights. ■