FINANCE AND TRADE

Hokitika Guardian, 8 March 1922, Page 1

FINANCE AND TRADE

CONDITIONS IN BRITAIN. AUSTRALIAN AND N.Z. CABLE ASSOr'ATION. LONDON, March 4. After the recent feverish activity in the gilt-edged department of the Stock Exchange, there lias been comparative quiettide during the past week. The general buying movement received a check from the uncertain political outlook at Home and the shipbuilding and engineering deadlocks, consequently there, has been a disposition to decure

some of the substantial profits accrued during the recent upward movement, but the, undertone remained distinctly good, and there has been little abate-

nient in the keen demand for firstclass securities. The firmness of these has been increased by a rumour current that the Govternment will shortly put on tap 4J per cent. Treasury bonds at 99. This is not confirmed, but it is believed to be an intelligent anticipation. There is also talk of an early reduction in the bank rate to 4 per cent. Everything points to a steady improvement in the Government credit. Tlie mariner in which recent good issues have been over-subscribed seems to suggest that investors arc fully aware that they may have to lie content in the near future with a yield of 4} per cent on irredeemable Government securities.

The optening of the wool sales on Tuesday is awaited with much interest. The general impression is that they will open about 5 to (5) per cent below January closing rates. If values are stabilised at about that basis, another buying movemfent may possibly develop. It is believed a fair amount of business at Bradford is being held up pending the result of the London sales, and if 64’s tops can lie produced at about 46d or 47d, a strong Home demand will arise. A satisfactory feature is the improving outlook in the piece-goods section of the industry. There is more enquiry, especially for soft handling fabrics, but a reduction in the cost of production is urgently needed.

Tn this connexion the remarks of the chairman of one of the largest clothiers’ firms in interesting. He said there was a steady improvement in both the Home and overseas trade, except when the exchange rate was adverse. Orders were well ahead of last tfear, arid they had been working full time for three months as compared with three days weekly a year ago. If there were no acute labour troubles, he looked forward to continued expansion. Other, reports from Leeds are hardly so optimistic. They state that not many businesses are in such a fortunate position, and prices arc still far from satisfactory, leaving little working margin. A definite improvement is impossible until the conditions of the export trade are more stable.

The metal markets generally show an improvement. The firmness in copper is due to increasing consumption in America and a good Continental db maud. Roth France and Germany are buying freely. Consumption appears to bo well above production. Substantial inroads arc being made into existing stocks, but production is likely to . increase in the near future, as some mines are being reopened. Probably the increase in output will enable production to keep pace with the consumption. The position of tin is also favourable. Tl*b tinplate trade at Pittsburg is very good. The production for 1922 is expected to equal any year in the history of the industry, therefore America is likely to buy largely, hut consumption in Great Britain and on the Continent is very poor, and heavy accumulations in the" Dutch East Indies and China are overhanging the market. The general trade report from official sources says that since the turn of the year tltere lias been a steady if restrained extension of the more.optimistic feeling which had shown itself (lining the preceding two months. The continuance of the movement towards normality, though slow, and the gradually increasing number of (enquiries, also the promise of extensive Government economy, are all contributing factois towards the brighter feeling, in spite of the fact that actual business has shown only a moderate improvement. Certain industries and trades, however, report detioitoiv improved conditions. itli falling costs of production there arc more and larger orders, owing to the feeling of greater security on the part of both manufacturers and buyers m regard to future prices.