FINANCE AND MARKETS

Sun (Auckland), Volume IV, Issue 954, 23 April 1930, Page 13

FINANCE AND MARKETS

FINANCIAL OUTLOOK QUIET WEEK HEALTHIER TONE (By “Noon Call”) The Easter holiday period has tended to divert thoughts from affairs financial during the past v/eek. Little has happened during the past seven days to alter the outlook for the Dominion inasmuch that, while commodity prices, especially those for New Zealand’s primary produce, continue low, there is no need for undue pessimism. In other words, the trend toward better times has started. Overseas, one of the brightest features has been the tendency in certain quarters for the money market to harden rather than to drop to lower levels oe interest, indicating a return of confidence and the greater use of money in industry. As far as N’cw Zealand is directly concerned, her loans on the London market have tended to appreciate, the fi per cent, issue, for instance, moving up from £lO5 5s to £lO5 10s at the end of last week. The outlook for wool is a little brighter with the improvement in the labour position at Bradford. The butter market has moved to slightly higher levels and closed last week showing a decidedly healthier tone. It is still held in authoritative quarters, following on advice from London, that there may be a further slight relapse before the real recovery pets in. Whatever the near future trend may be, however, there is much m the contention that the Nlew Zealand dairyman has less to fear from future trends of the market than any of his contemporaries overseas. CMmatic and other conditions give fchn an enormous lead from the point view of costs of production and, if prices do come down, or show little fmprovement from present levels, t»ther countries, notably Denmark, will be faced with the need of turning to some other line of activity more profitable on a competitive basis. New Zealand dairymen, on the other hand, vsill be able to carry on with increasing production, helping to make up deficiencies in price. In the Waikato this year, the New Zealand Co-operative Dairy Company, Limited, will turn out over 5,000 tons of butter ahead of last season’s figures, representing an increase of approximately 20 per cent. in production. A similar trend, although not quite to the same extent, is noticeable in dairying circles throughout the whole of New Zealand. There is every reason to believe that this trend will continue for several years to come. THE INVESTMENT MARKET For anyone with money to invest, whether the sum is great or small, the present is unquestionably a rather trying period. With so many bearing influences abroad it is very difficult to take a rational view of the position. The trend in all directions appears to be downward, and, to (he uninitiated, it seems that investments made today, irrespective of the greatest care in selection, depreciate tomorrow.

Out of the mists of so much financial uncertainty, two factors seem outstanding: these are, firstly, that there is little offering in the way of sound investments to man in the street outside of the range of Stock Exchange listed stocks which will bear inspection, and, secondly, that, except on giltedge first mortgage, the real estate market cannot offer anything to compare with many investments offering through the medium of the Stock Exchange at the moment. The writer believes with Messrs. Joseph. Palmer and Sons, the wellknown Sydney sharebrokers, that the present is a most opportune time to pick up investment bargains which should prove) most satisfactory holding. Discrimination should be used in favour of stocks which are likely to return increased dividends, or allow shareholders the right of participation in likely bonus issues in the near future. No doubt there are some stocks which are still liable to minor fluctuations, and some companies may decide on temporary reductions of dividends, but this cannot affcot the ultimate trend of the market. The chances for improvement now are just as good as they were in 1921 when so many purchases, wisely made, proved so satisfactory to holders who were able to take a long view, and who were not influenced by minor fluctuations. For the investor ay ho is not prepared to take any risks. the writer still recommends the Government loan at 54 per cent, which can be taken up cither through a broker, through one c*C the trading banks, the Post Office, or through the local branch of the Treasury Office. For those? wlio are prepared to take P little more risk with the prospect of a greater return now and in the future, the following have undoubted attractions. In every instance the company's finances are on a sound : footing and the management has been tested and found to be sound over a period of years. Not only is the immediate rate of return attractive, but there is a big prospect of either increased dividends or a market appreciation of values; particularly is this the case in respect to shares which seem to be giving the lowest return at the momen't. The following table gives the approximate price of the scrip on the market Avith the return on investment on every one hundred pounds invested, based on the latest dividend.

METAL PRICES

LONDON, Monday. on April 17 are given in parentheses.) Copper.—Spot, £SB 18s 9d (£SB 17s JW); three months, £SB 17s 6d (£SB 3d). Electrolytic Copper.—Spot, £ 65 s•£6s); three months, £66 (£66). Wire Bars.— £66 (£66). Lead.—Spot, £IS 6s 3d (£lB 11s Jfrl); three months, £IS 7s 6d (£lB s®* 6d >. „ „ Spelter.—Spot, £l7 16s IOJd (£ 1 * 9d); three months, £lB 6s 1 <£lß 8s 9dE Tin—Spot. £165 Is 3(1 (£164 6s Id); three months, £ 167 6s 3d (£165 |ls 3d). Silver.—Standard. 19 11-16 d (19 $-Sd) an oz.; fine. 21id (21 3-16 d).

Approx. Approx. Price. Return. £ s. d. £ P s. d. Bank of Aust 21 1 S 5 IS 6 Kng.. Scot, and Aust. fi 12 8 Dalgety and Co. 112 8 7 12 9 40 o n t> 5 0 British Tobacco *Mt. Ryell Mining and 112 0 * Mount Lyell is so much interested in the fertiliser manufacturing industry that it cannot be reg arded as a specu : lative mining stock.