TRADE REVIEW.

Taranaki Daily News, 30 May 1921, Page 5

TRADE REVIEW.

CONDITIONS IN ENGLAND. SLUMP IN THE STERLING. WOOL PROSPECTS BETTER. ‘j> By Telegraph.—Press Assn —Copyright. Received May 29, 5.5 p.m, London, May 28 Business on the Stock Exchange has been decidedly dull under the influence of the coal strike and persistent selling by Paris, but closed with a better tone all round on the more hopeful prospects that the conference will lead to a settlemen l and a cessation of French selling. Another factor tending towards the improvement is the closing of the conversion loan. The latest estimate is that about £632,000,000 has been converted. With this out of the way brokers are hoping to see an improved demand for gilt-edged stocks, which lately have beep somewhat neglected, owing to competition. A feature on the Stock -Exchange is the pronounced activity in promoting circles, which commenced with the reduction of the bank rate, and if, as is expected, a further reduction follows with better coal news, plenty of new capital iwues will be placed on the market, mostly fixed interest securities, which are mofe in favor than speculative or semi-speculative, as investors nowadays seem to prefer the safety of the principal rather than a high interest yield. The foreign exchange market had an exciting week, with sensational movements. The slump in the sterling to 3.89 dollars is attributed in some quarters to the action of the Reparations Commission in arranging the transfer of huge sums by Germany to the Allies without thinking how the transfers can be made and what the effect will be on the money market. Then the commission announced that it would receive payment in dollars alone, causing heavy purchases of dollars in Germany and Holland, and completely upsettipg the market. Other authorities attribute the fall to speculators, who were responsible for the rise in the sterling and are now reversing the action.

Better feeling is apparent throughout the wool industry, principally due to the strength of the primary markets, and though much textile machinery at Bradford is idle many firms have received offers of business which would ■warrant them running full time if they could obtain fuel. In the meantime topmakers' quotations remain firm, with a fair amount of business. Stocks are low, owing to recent shipments to America and restricted production. Reports of successful sales in Australia, New Zealand and Antwerp are giving the market a confident tone, and the prospects for the London sales are hopeful. The Economist attributes the recovery _n non-ferrous metaLs prices in a measure to the fact that the worst prices touched were well below the cost of production. The greatest factor in the rally consists of a reduction of output. A large part of the recent buying of copper in London has been on account of Germany and Japan, although there has also been considerable speculative purchases in anticipation of an extensive demand following the coal settlement. A drop in the price of tin caused the closing of every Cornish producer and the restriction of operations in Northern Nigeria. Companies are now able to jxroduce below the current market price, thanks to economical working and Government concessions in rent and royalties. —Aus.-N.Z. Cable Assn.