Financial Notes
A MODERATE 'REACTION.
AFTER a long period of almost uninterrupted rises in prices of securities, markets have displayed a somewhat reactionary tendency during the past week. Anxiety with regard to the outlook in France and also with regard to the, general political situation in Europe may, perhaps, be the principal cause of the set-back, though I think it is scarcely necessary to look further than the somewhat excessive rise of recent months. With regard to the technical position of markets there is a good deal of uncertainty how much of the buying has been of a speculative character, and it might be said at the moment that the pause in activity and a few realisations by holders are applying a very useful test to the market. If as result of that test it should be shown that there are no unwieldy speculative positions, I think that it will not be long befdre there is a fresh upward movement. Speculative markets have shared to some extent in the reaction, and gold mining shares have weakened on the fall in the price of gold—a movement, however, which I am inclined to regard as being of a temporary nature. -
TRUST OF BANK SHARES.
The-managers of Trust of Bank Shares have recently issued their first Progress Report covering the first distribution period of the Trust of Bank Shares from the date of its formation at the end of 1935 to August 27th of this year. The bank units . were first offered to the public at 19s. ; the current price is about 19s. 6d. ex dividend, and the- distribution payable on the 15th of this month amounts to 4.9638d. per unit, free of tax, of which Q.2663d. is derived from the sale of rights. After taking into consideration the incidence of dividend payments during the next six months, the managers estimate that, allowing for Income Tax at 4s. 9d., the gross yield on the current price will be approximately 4 per cent. for the first two half-yearly periods, and will exceed the yield estimated at the formation of the Trust, namely, 4 per cent. on the original price of issue. An analysis of the Trust's present holdings accompanies the report.
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' OUR FOREIGN 'TRADE.
Those who may not be in the habit of following very closely the monthly official returns of our foreign trade must, I think, be a little puzzled by the conflicting views taken of them by the various newspapers. Those journals-conspicuous for looking on the bright side of things,: and which sometimes even seem prepared to manufacture artificial sunshine, pro- claim the fact that the total of exports was the-highest for the month of August for some six years. Other sections of the Press, disposed to examine the situation more soberly, draw attention to the fact that as compared-with twelve months ago the advance in exports is only abet:it £500,000, whereas imports rose by about £7,000,000, thus increasing materially our visible trade balance.' In fact, for the first eight months of this year the excess of imports was £211,000,000, or about £47,000,000 greater than for the corresponding period of last year. No doubt the great expansion in our imports reflects greater, prosperity at home with _greater consuming power, while the figures are als0 possibly affected by. purchases -of raw materials in connexion with the Government's programme for the national defences. Nothing, :however, can alter the fact, that to _a country which depends upon its exports to pay for its imports the ,increase ia_the adverse-trade balance is an
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