NEW SLIDE on Stock Exchange

Hawke's Bay Herald-Tribune, Issue 88, 30 April 1937, Page 5

NEW SLIDE on Stock Exchange

-Pr»ss iuBt'

INVESTORS NERVY Shares Fall Although Trade Booms POLITICIANS BLAMED

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-Copyright.)

(Received 30, 8.45 a.m.) LONDON, April 29* fresident Eoosevelt's alogaii of 1933 1 "'fhe Ofily thing we -have to fear is xtself " is peculi&rly applicable to Jijjg present state of the markets which k*ve deteriorated beyond reason. They opened weaker after the woret % of the year. Tho present atmosphere . it that no rumour is too silly to gain •rtdence. Investors are in a state of fright, leaving their money in the biaiks, and are even turaing their flk&res into cash at a loss and are asking whether the present eetbaok — which must have reduced the markot •apitalisation of securtiea by over £1,000,000,000—13 not a prelude to & MW elurnp. "Such feare are based on the failure to grasp the elements of the aitttation," one of the most experie&ced Stockbrokers told the Absociated Preee Oity editor. ' 'We caa't have a slump with a 2 per cent. bank rate, £100,000,000 defence loan and a constant ttttam of excellent company reports and trade vf&tlstics. It siinply doesn't make * eense. The stock exchange cannot indellniteiy ianguish while induatry it hununing. The reaction may be hoth audden and rapid. When the rearnuunetit money begins to talk Jt will talk loudiy." The Daily Mall tersely advisea in' viftors to keep their stocks and their fctftde. "The Board of Trade statistics aho* thp biggest jump in retail saies om, record. While fresident Roosevelt Mr Neville Chamberlain oan claim the doubtful honour of starting the jpreient malaise, the technical character tiftireof cannot be overemphasised. " The initial declines placed a severe Jbi^en on the market machinery which htd a snowball effect, forcing operatofe ie* .thrn their saleable stock into cash Jh erder to meet obligations incurred in •tlHtr markets, while even those who have come out unscathed are reluctant to iissume fresh commitments, thus depriving the markets of their norma] •nshions. Soch a major elide cannot pass with0«t affecting the short-tenn economio-

•etivity. The bug of healthiness in the km|-term outlook is indubitable. The Financial News expresses the frxU- eonviction that new peaks of •atmty and prosperity will be reached to the next two or thi&e years, a view l« which responsible city men and indfurtolalists concur. It ie hoped meanwhflo that the politicians will spare the ddltdhte mechanism of finance further Ihodu and do their best to restore the ohalKn confidence. Lord McGowan, at Imperial Cheiniannual meeting, declared: "With Ihe widespread tendency of rising comasUHty prices and rearmaments there is .■d.itason to anticipate a decline in the tgSjtVity of 1937, but while there is no l&at the voluine of home trade will Soaidnisli, it is difficult to contemplate tho export markets with equal confiitjMO, Economic nationalism is restrictlif foreign trade, while some DoiniKiou, notably Australia and New Zwland, with greater home production foodstuffs and a stationary population may have reached the maximum .tpi^drt of primary produce. " j .HBritain may, therefore, have to prodweo goods she now buys outside ISagl&nd. Industry should, therefore, •nOOurage researeh, improve efficieney and strenuously endeavour to maintain ffcrriign trade." Gold is quoted at £7 0/6 a fine ounce. Ejpbanges: New York, 4.94 3-16 dollars to £; Paris, 110 9-16 francs to £1. ' ^Sfgper. standard is quoted at £57 2/6 •r against £54 6/3, tin at £242 17/6 as agfcinst £239 17/6 and lead at £22 8/9 ti against £22 5/-.