BRITISH TRADE.

Taranaki Daily News, 18 September 1922, Page 5

BRITISH TRADE.

QUIET TONE PREVAILS,. ACTIVITY RESTRICTED. OUTSIDE INFLUENCES, By Telegraph.—Press Assn.—Copyright. Received Sept. 17, 5.5 p.m. London, Sept. 16. Events in the Near East and the breakdown of the Belgo-German reparations negotiations caused some depression on the Stock Exchange, and there has been considerable selling of gilt-edged securities. The sales were not entirely due to international political apprehensions, but partly to the maturing of a great number of options entered into at the end of June. It it also suggested in some quarters that big speculators who sold out of “industrials” two years ago and purchased gilt-edged securities are now selling the latter in order to re-buy leading “industrials,” owing to signs of a trade revival. Another contributory factor is uneasiness regarding a possible advance in the bank rate. The general position on the Stock Exchange is, as the 'Statist newspaper says, peculiarly difficult to analyse. On the whole the tendency appears to be downward in the case of investment stocks and upward in the speculative divisions, but not definitely marked in either ease. If trade improves to any extent money will flow from the investment markets to trade channels and high-class investments, and quotations will be adversely affected. The danger that investment values will recede causes buyers to hold off, while the risk that trade ,will not recover makes them chary of supporting the more speculative sections.

There has been a slight improvement in foreign exchanges, following a report that Herr Havenstein is arranging with the Bank of England to guarantee German bills. The recent depreciation of the American exchange is explained by a financial expert to be due mainly to the seasonal preparations now being made by thia country and the Continent for financing their purchases of American produce, principally cotton and wheat. This, of course, means larger demands for dollars, which are nearly all bought in this market, and also means sales of francs, lire and other currencies in order to secure the necessary dollars. According to the Ministry of Labor’s gazette employment during August remained bad and the improvement which has been in progress since the beginning of the year was not maintained at the same rate as in previous months. There is a marked improvement, however, in the coal mining industry and some improvement in the pig-iron industry and iron and steel manufacture. The percentage of unemployment at the end of August among trade unions making returns was 14.4, compared with 14.6 at the end of July, and 16.3 in August, 1921. The average level of retail prices of commodities at September 1 was 79 per cent above July, 1914, compared with 81 on August 1. The decrease is mainly due to a fall in the price of potatoes. Commenting on the wool position, a well-known authority says that topmakers in most cases are adopting a protective policy. The volume of business is not as large, as buyers, in view of the near approach of the colonial season, are inclined to await developments. Spinners continue well employed and are finding more interest on the domestic account, but they are not obtaining prices commensurate with the quotations for tops and raw material, and with each advance new business becomes increasingly difficult. Conditions in the manufacturing sections show slow but satisfactory progress, increased orders on some accounts being a welcome feature, and the situation generally is sound and the demand extending. The fact that there is a political and economic crisis on the Continent had little effect on our wool market, but it coincided with an appreciable advance in values, which is remarkable evidence of the strength of raw material and improved conditions in the consuming centres.

The Continental demand shows no abatement and machinery everywhere is well employed. The German textile trade continues prosperous and seems able to finance all the necessary raw material. The outlook for raw material presents encouraging features, and a strong opening of the colonial season is generally anticipated. The position of merinos and fine crossbreds is gradually being strengthened by a steady expansion of consumption. Anxiety regarding the future German demand is hardly so acute, and the possibility of an early settlement of the American tariff foreshadows an increased demand on the United States’ account. —Aus.-N.Z. Cable