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Hawke's Bay Tribune, Volume XVII, 5 December 1927, Page 9

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LONDON ’CHANGE FOREIGN EXCHANGE MARKET. EFFECTS OF AUSTRALIAN STRIKE. London, Dec. 3. The Stock Exchange has been generally steady, with considerable activity m certain departments, notably some of the more or less speculative industrials, in which there has been a revival of activity. The giltedged market has been dull owing to the competition of new issues, especially the Palestine loan of 4,475,000 five per cents at 100} and the Irish Free State issue. The success of the former was never in doubt,, the terms being so attractive, with the addition of the British guarantee, that one financial newspaper described it as a Christmas gift to investors, who rushed to apply for it. Dealings commenced yesterday and a premium of 1} was quickly established. It is satisfactory to note that, this new issue competition has not affected other dominion stocks, which, on tho contrary, have been in demand, especially the new Commonwealth issue, which, after opening at onehalf per cent, discount, now stands at only one-sixteenth below the issue price.

A feature of the Foreign exchange market is the steady upward course of the pound sterling. Measured in terms of the United States dollar, today’s price, 4.88 3-16, is the highest on record sine© 1914. but the rate has not yet reached the point at which gold can profitably bfe shipped from America to England, which is estimated to be 4.88 J, but financial circles expect shipments mav be possible before very long. The “Financial Times’ ” New York correspondent says: “The feeling.is growing that England will take gold from the United States before the end of the first two months in 1928. Bankers think 100,000,000 dollars o ( - more could be shipped without disturbing the New York market.

Among the results of the Australian strike is a depression in other freight markets, as ships which should have been employed carrying Australian grain are compelled to seek employment elsewhere The “Morning Post's’’ shipping correspondent says the only reallv active market is Ki ver Plate which is inundated with tonnage seeking employment. The Pacific trade is expected to , absorb a considerable amount of tonnage between now arid February, b|it with Australia on t of the running charters are getting all they require at cheap rates Australia will have to charter sooner or later and when the strike is nv»r tonnage will have to be attracted, probably at appreciably higher rates than are now ruling. BUTTER TRADE ACTIVITY. After a dull week, th e butter trade showed more activity yesterdav. Prices recovered about two shillings The improvement iipparent.lv was partly due to tears that the strike may seriously affect supplies of Australian, but buyers am also beginning to fill their Christmas requirements and stock of best, colonial are by no means excessive. Meantime Australian butter is being freely advertised by the Australian publicity department. Uns week numbers of newspapers, both daily and trade, contained a'full page advertisement extolling the virtues of Australian butter. Next week the campaign will be extended to omnibuses and hoardings by means of striking and attractive posters. Describing the position of the Bradford market, correspondent writes: “Quotations maintained. Spinners and manufacturers, however, are disinclined to speculate more freely. Many of them are of the opinion that for the period the market has about reached the highest level and they are prepared to stand out for a time, a.s they have fairly well covered their requirements Thev are encouraged in this attitude by the refusal of their customers tn follow the further upward movement in values. At th© moment spinners are being pressed for quick delivery ot yarns and more of them are being compelled to work overtime. There has been a good deal more machinery brought into action in this depart ment but the present pressure is mainly due to the manufacturers having let their stocks get down to a low level, and now thev are pressed for seasonal goods. Ln view of tho limited amount of new business, spinners fear the present activity may soon fall away.”—(A. and N.Z.)