Market Notes
By CUSTOS
THE downward trend of the security markets was checked when the news came from Basle of the renewed credits for sterling. On the other band, a sharp fall was seen in gold and copper and the shares with dollar interests which had been bought as a devaluation hedge. HUDSON'S BAY and CANADIAN PACIFIC, which had been run up to prices yielding only 31 per cent on divi- dends, seemed overdue for a reaction. The gilt- edged market at last took a turn for the better, and Exchequer 5 per cent 1967 (repayable at par in November next year) recovered to nearly 98 (being in a tax-free zone, this is still an ex- tremely cheap stock). If Bank rate remains un- changed, the 'shorts' should make further head- way, but both the 'longs' and the medium-dated stocks seem unattractive while interest rates re- main high and the flood of loan stock issues Continues. Until there is a settlement of the sea- men's strike, equity markets will no doubt re- main subdued. An inflationary settlement will probably bring long-term buyers back into the market, while unit trusts continue to take an in- creasing amount of stock out of jobbers' hands. A crop of takeover bids is maintaining specula- tive interest in equities. The GUEST KEEN bid for BIRFIELD--worth 18s.—has been rejected by the directors and it looks as if Guest Keen will have to raise its price, the present market being 21s. ENGLISH ELECTRIC has at last made a bid for ausroN AND HORNSBY (one of the leading makers of diesel engines) on the basis of thirteen ordinary for every ten, which put a price of 64s. 4d. on the Ruston shares, which were previously quoted at 53s. 9d. The market jumped 10s. to 64s. 9d. but came back to 61s. 3d. If only P AND 0 would make a takeover bid for CUNARD! These shares are now down to 14s. 9d. The strike will probably cost Cunard over £1 million and put its 5 per cent dividend in jeopardy. There was a rally in steel shares on the report that the Nationalisation Bill will come shortly on the basis of the White Paper.
Previous page
