Financial and Investment Notes

MARKET ACTIVITY.

IN view of the favourable conditions of Home trade, it is not altogether surprising that the activity in the Stock Markets should be maintained, and although there has been a certain amount of profit-taking during the past few days, fresh buying has been in evidence and the undertone of all m irkets keeps very firm. Moreover, the sensational rise in some of the leading commodities, and especially in some of the metals, has occasioned some sharp advances in the shares of Base Metal companies, while another feature of markets is the manner in which British Funds and kindred securities also keep firm in spite of the diversion of speculative activity to other departments of the House.

* * * * THE RISE IN COMMODITIES.

A feature of the upward trend of commodity prices has been the big rise in the price of copper, which is now over £44 per ton, as compared with just over £35 a year ago. Copper production is subject to a restriction scheme under which the United States producers regulate their own pro- duction and price as a separate entity from that of the leading producers outside the States. The latter, which include the great Northern Rhodesian mines, produce up to a deter- mined quota of their standard production. In the past few months the demand for copper has been so greatly increased, largely owing to rearmament requirements, but also to Cot ti iental speculative purchases, that stocks have suffered a severe decline which successive advances in the quota have failed to check. From 70 per cent. the quota of the pro- ducers outside the U.S.A. has been advanced to 5 per cent. over the full agreed basic tonnage, and the domestic pri:•,e in the U.S.A. has gradually come up to 10 cents per lb.

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The rise in commodities, however, has by no means been confined to Copper, an outstanding feature of the past two days having been the jump in the price of Tin to £244 5s. per ton, a price which compares with £211 15s. a week ago and £231 15s. a twelvemonth ago. The recent jump in the metal has been due to the recent decision of Siam to participate in a new agreement for the control of production, and following the rise in Tin there has been a sharp advance in the shares of Tin Mining companies. Moreover, as showing the extent to which nearly all commodities have appreciated, the commodity price index compiled by Reuter rose this week to a new high record of 162.4. That index is based on a broad selection of prices, including those for gold and silver, and takes prices on September 18th, 1931, immediately before Britain's departure from the gold standard, as equal- ling 100. Commodity prices, therefore, are now catching up with the rise in the sterling price of gold. Among the noteworthy commodities contributing to the advance besides those just mentioned must be included Wheat and Rubber.

* * * * TIN MINING PROFITS.

The latest Report of Pahang Consolidated for the year ended July 31st last shows the effect of, the greater prosperity of the Tin industry, the mining profit for the year of £183,578 being more than double that of the previous year. The dividend has been raised from 15 to 49 per cent., the Preferenc,... 'Shares receiving in all 15 per cent., while the usual 10.per cent. depreciation was written off and a further £10,000 place(' to Development Reserve.

A GOOD RECOVERY.

A striking instance of a change from loss to profit is shown in the latest report of John I. Thornycroft ana',Co:, Ltd., the marine and motor engineers. A year ago the report showed a loss of just over £102,000, but the report now issued for the year ending July 81st last reveals a net profit of £40,240. As a result of this good recovery, the Directors are' enabled to extinguish a debit balance of 238,463 broiight into the accounts and to carry forward a credit balance of 4Cenifnued on page .878.1

. Financial and Investment Notes

(Continued from page 876.) £6,777. The turnover at Southampton for new construction and ship repair work has increased, and the company has been entrusted with the repair and maintenance of the

`Queen Mary:

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BREWERY PROFITS.

The latest report of Mitchells and Butlers, Limited, the well- known brewers, is a good one. For the year ended Septem- ber 30th last the profit, after making provisions, including tax, amounted to 1687;373, against 1642,541. Including the balance brought in, the available total is £1,240,739.

• The Directors now recommend Anal dividends on the "A" Preference shares of 3 per cent., less tax, making 6 per cent. for the year ; on the " B " Preference shares, 3 per cent., less tax, also making 6 per cent. for the year ; and on the Ordinary shares, per cent., free of tax, making I7i per cent. for the year, which is equivalent to nearly 23 per cent. subject to tax. On the 7 per cent. maximum Ordinary shares a dividend is paid and a further sum added to the General Reserve, bringing it up to 21,550,000. The Directors state that the output and trading results for the year make a favourable comparison. The Directors are now recom- mending the conversion of all the issued shares into stock.

B.A.T. ORDINARY.

A correspondent who has evidently, secured some good profits on Industrial shares enquires whether I could recom- mend the purchase at the present price of British American Tobacco Ordinary shares. Considering that at the present price the yield is now well under 31 per cent., it is not sur- prising that some hesitancy is shown with regard to an intending purchase, though, as with breweries, so with tobacco, the general improvement in trade and the great increase in the number of employed is, of course, a point which favours increased consumption in the immediate future. The present high price is, no doubt, due to hopes of a still further rise in the dividend, which for last year was 20 per cent., free of tax, and it may be that these anticipa- tions will be realised.

A GOOD REPORT.

The report of Dalgety and Co. for time year ending June 30th last reflects the more prosperous conditions in Australia, the profits for the year being no less than £145,851, against only £56,789 for the previous year. As a result, the Directors are able to pay a final dividend making 6 per cent., free of tax, for the year, whereas for the four previous years the dividend was per cent. Moreover, for the previous year even the 5 per cent. dividend was paid with the help of £40,000 from the Contingency Fund. The report states that in Australia seasonal conditions have been favourable, except in Western Australia, where the drought has continued.

The balance-sheet is a strong and liquid one. A. W. K.