TRADE REVIEWS.

Taranaki Daily News, 7 February 1921, Page 5

TRADE REVIEWS.

A BRIGHTER TONE. j , I STOCK EXCHANGE CHEERFUL. J . . I THE FALL IN BUTTER. | By Telegraph-—-Press Assn.—-Copyright. Received Feb. 6, 5.5 p.m. London, Feb. 5. The weekly summary of finance and trade says that Mr. Chamberlain’s announcement of the discontinuance of the excess profits duty has given intense satisfaction on the Stock Exchange, and it has imparted a cheerful feeling to the markets, because it removes the feeling of uncertainty which has been prevalent for the past six months. The general decline in share values during that period was not due so much to pressure to sell as to the absence of interest on the. part of the public, owing to the unsettled outlook, which counteracted the effect of the lowness of prices. The removal of the excess profits duty should have a tonic effect on the investing public, and should cause a resumption in buying industrial stocks, owing to the expectation of an improvement in the trade which is likely to follow the removal of the tax, especially as no other tax will be substituted. But until that improvement comes a general advance in values cannot be expected. On the other hand, the announcement that there will not be new taxation will probably have an adverse effect on some gilt-edged stocks which are available for the payment of death and other duties, notably Victory bonds, which declined slightly. Other investment stocks, like Colonials, may feel the effect of the competition of industrials. The money market is rather easier, but much money is going into the Exchequer, and there is little prospect of a permanent ease till the end of the Government’s financial year —March 31. Meanwhile, there is less talk of a reduction in the bank rate, but its advocates have not yet abandoned hope. The Bradford wool market is meeting with a good demand for fine tops and yarn from the United States, mainly speculative in anticipation pf the proposed tariff changes in March. The home trade is very quiet, and heavy stocks of piece goods on hand still form an obstacle. Hostility to the Wool Realisation Association is diminishing somewhat, but. the trade is keenly watching operations. The general feeling is that prices are stabilising at about the present basis, which is considered about bottom. A readjustment of retail prices is now urgently required to restore public buying confidence. Freights continue to decline, and oyvners are keenly competing for the small amount of business offering. The rate for Australian wheat is now about 67/6, with 5/- reduction for West Australian loading. The reduction in the price of Government butter is causing a\better demand, especially as some shops are retailing at 2/10 and 2/11 in order to increase customers, but the statistical position is making buyers generally nervous and indisposed to enter into commitments ahead. Argentine and South Africa are offering butter at 180/- to 200/- c.i.f. The Danes are very dissatisfied at the British Government price being reduced to 226/-, and they threaten to stop shipments, but there is little fear of this being done, as other countries are unable to purchase freely. The metal markets display a better tone on Mr. Chamberlain’s announcement. Copper is firm on reports of negotiations in the United States for a loan to finance the surplus copper in the producers’ hands. If the loan succeeds, it is likely that prices will rally temporarily. The tin market is unsettled, owing to uncertainty regarding the action of the Malayan Government. Heavy sales in the middle of the week were followed by “bear” covering, which caused a rise on Friday. Spelter remains steady. Reports of further curtailment in American production had no effect here. Germans are offering to Sell for shipment till April, being apparently anxious to dispose of as much as possible before the twelve per cent, export duty comes into force. —Aus. and N.Z. Cable Assn.