Finance Stocks and Mining

Free Lance, Volume IV, Issue 168, 19 September 1903, Page 5

Finance Stocks and Mining

THE London money market, appears to bo in a fever.sk state, and this is be-ig severely felt on ll.e Stock Exchange. The slump in gilt-edged securities is most pronounced, and Imperial Consols, generally regarded as the finest securities m the world, are now at a very low price. There are many causes operating to bring about the "present position, but there are two special features which largely account for the decline. The enormous borrowings of the British Government to finance the Boer war flooded the market with this class of gilt-edged securities, and, furthermore, the interest on Consols was reduced from 2% ncr cent, to 2\ per cent, on the Ist of April this year. Incidentally, the effect of the extension of the volume of trustee securities must not be overlooked. * *• By the admission of a great volume of colonial stocks to the Trustee List, those investing trust funds have a wider held of choice, and naturally prefer the stocks that yield the best returns in interest. While it is, to some extent, easy to account for the decline, it is none the less serious and far-reach-ing in its effects. It renders hopeless all prospect of colonial borrowing m the London market for a time at least, and this will inevitably react on the colonies, for 1 it will compel the limitation of expenditure on pubic works throughout Australasia. Warning: notes have been given by the various Colonial Treasurers, and there can, therefore, be no disappointment when the results come home to the people. * * * There is, however, nothing to be alarmed at in the circumstances, especially in New Zealand. The past five or six years of extreme prosperity have left the people in possession of adequate funds to meet any such adverse conditions, and it is not likely, even if the London money market is depressed for the next six months, that the people of New Zealand will be seriously inconvenienced. And that no trouble is anticipated is evidenced by the sanguine, if not optimistic, feeling that prevails. The best indication of this is shown by the fact that real estate maintains its value especially in and about "Wellington. Properties are changing hands at remarkably handsome figures and some of the most shrewd men in the community are buying real estate. In other respects also there is a hopeful feeling and at least we can look for another year of piospority. The wool sales, with the substantial rise in the value of crossbred wool, strike a very cheering note, and is the most welcome news that can be received in New Zealand. A fractional rise in the price of wool means so much to the farmers, and a great deal more to the community in general. Crossbred wool shows a handsome recovery from the slump of two years ago and one of the happiest incidents of the past week or so was the receipt of account sales for wool marketed at the fourth series of London sales. In nearly every instance farmers had something more to come, and this something amounted to in some cases £3 per bale. The outlook is very nromisine for the new clip and a good wool market is a source of income to the colonies. * * * Another product that brings in a good income is butter, and, although it is generally believed that this 1 product will not rule as high as in the past season the expected increase in production will more than compensate for the slight fall in prices that may take place. Broadly speaking, the income of the country — that is, the balance of exports over imports — will be as large (if not larger) than m the past year, and, that being so, there need be no immediate concern about depression or the possible effects of an adverse money market. * * * The Bank of Australasia has had another prosperous half-year, and the dividend of 48s per share, just declared, will be paid m this colony on the 2nd proximo. The business of this bank reflects the economic conditions of the colonies, for it is fairly well represented throughout Australasia by branches and agencies, and a dividend of 12 per cent, por annum, after making full provision for contingencies, and writing down in a drastic manner such securities as Imperial Consols, is a pretty good index of the soundness of the colonies generally.

With the change m the w eather conditions, and the advent of spun? the usual activity is displayed, and the shareinaiket is experiencing the full effect of the change. Business has been quite active, and company piomotion pi onuses well. Apart from the flotations now in hand, and announced, a new land company to deal with a large block of land in the Wairarapa is projected. A meeting of those interested w-as held on Tuesday, and eveiything promises well. * * *■ Bank shaies have been quieter than usual, but prices show- no vanation. There aie buyers of National Bank shares at 91s. sellers asking 925. Bank of New Zealand shares are offered at 81s 6d, but business in this stock is, to an extent, affected bv the uncertainty as to the nature of the projected banking legislation. Financial shares are very firm, and in st--o.ig demand. National Mortgage shares had quittance at 455. Buyers offer £9 12s 6d for Equitable Building £7 10s for Wellington Trust and Loan, £9 12s 6d for Wellington Building, and £12 for Metropolitan Building, but there are 1.0 declared sellers. A large parcel of Masterton Permanent Building sha,res, £10 paid, were taken up by Wellington investors, at a piemium of 10s per share. In view of this, it is possible that the Society may see the propriety of appointmg a Wellington representative on the Board of Directors. It would add to the confidence of local investors if such a course were follow cd. An effort should be made to have the shares quoted on the Wellington Stock Exchange. * * * Gas shares have changed hands freely during the past few days. Wellington Gas shares sold at £19 10s, and £9 los for the respective issues. Port Chalmer gas shares sold at 31s 6d, and Feilding Gas at 20s 6d. Chnstehurch Gas shares are wanted at, £9 los. Insuiance shares are very quiet, the only demand being for South British shares, for which buyers offer £3 Bs. The balancing period of the South British closed on the 31st instant, and it is evident, from the demand for the shaies, that a good report and a , substantial dividend are expected. Other insurance stocks are without change NewZealand Accident Insurance shares are in request at 4Gs Cd. * * * Meat shares are quiet, without any quotable variation m prices. Wellington Meat Export shares, £5 naid, are in demand at £7 ss. Christohurch Meat shares are offered at £10 2s 6d, and Canterbury Frozen Moat shares at £9 10s. Woollen shares have been in more active demand recently, and sales are reported of Kaiapoi Woollens at £6 8s 6d, and Wellington Woollens at £5 Bs. The annual meetmg of shareholders of the Wellington Company was a pleasant function, and the directors were able to give a most , cheering account of the prospects. * * # In miscellaneous shares there -has been good business, shares in the two brew mg concerns in Chnstehuroh meeting with buyers. Manning and Co.'s shares sold at £4 ss, and Ward and Co. at £4 10s, Leyland and OBrien Timber shares changed hands, at 45s and Mauncevillo Lime shares, at 22s 6d cum dividend. The shares of this latter company have a distinct upward tendency. * * * Mining in Australia is showing considerable improvement. The output of gold in Victoria for the first eight months of the year totalled 531,5550z, or an increase of 22,2650z on the corresponding period of last year. Western Australia, during the same period, had an output of 1,290,552 fine ounces, an increase of 80,7380z over the same period of last year. These two States show an increase of over 100,000oz, and the records of the other colonies and New Zealand are also favourable. Speculation in mining shares is very fitful, although, on the whole, there is evidence of increasing confidence in the dredging industry.