Market Notes
By CUSTOS
Wrm the rain on Tuesday came an early flood of selling on the stock markets- prompted by the panicky fall on Wall Street- but at long last the managers of insurance funds were tempted by the low prices and came in buyers. The F.T. index closed the day 2.9 up after being 2.5 down. The rally will probably be extended as there is a large bear position to be closed before the end of the long three-week account. Wall Street is also due for a rally but whether it can be held seems more doubtful. Some brave brokers are telling their clients that we are coming near to the end of the long• decline in Throgmorton Street. This depends very largely on the coming gold reserve and trade figures and on the interim report of the ICI. Will the directors maintain or cut their dividend? The price of this market leader-36s. 3d. to yield 6.9 per cent on the last dividend-indicates that a small dividend cut is being discounted. Both ROLLS-ROYCE and BRISTOL AEROPLANE went lower on the terms of the agreed merger but no one could say that the terms were unreasonable- 63 Rolls and £8 nominal of 71 per cent con- vertible loan stock for 100 BA. In fact, BA is being bought out at 14.8 times earnings and HAWKER SIDDELEY at 15.7 times earnings for their half interest in Bristol Siddeley Engines. The merger undoubtedly improves the prospects of Rolls which now yield 5.4 per cent at 40s. 6d.
JOHN BULL is on holiday
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