FINANCE AND INVESTMENT
By CUSTOS
IN spite of good news from the war fronts, markets have failed to develop any real activity. There is no longer room for doubt that the great step taken by the Stock Exchange Committee in com- pelling brokers to charge clients buying and selling commissions on all transactions has had the desired effect of choking off many of the in-and-out speculators. In consequence, markets have lacked the speculative lead which is usually necessary to get them out of the rut and keep them on the move. Then, again, prices in many groups are beginning to look high enough, and in the promising fields business is badly hampered by the scarcity of stock offering. Taken as a whole, markets are getting more and more selective. I see no reason, however, to alter my view that the basic trend of security prices is upward.
BOWATER GROUP PLANS
Shareholders in the Bowater's group of paper manufacturing companies will be agreeably surprised at the directors' intimation in the latest accounts that plans for dealing with preference dividend arrears are now being investigated. Profits now seem to have bottomed, and as substantial liquid resources in the shape of cash and gilt-edged have been accumulated since the outbreak of war, the board is rightly prepared to tidy up the whole position. Most of the preference shares in this group now carry about three years' arrears of dividend, and it is not surprising that there has been some demand in the past fortnight for Bowater's Paper Mills 61 per cent.
2nd 71 per cent. preferences around 23s. Both these issues should Gradually move up to within a few shillings of the 3os. Mark.
A CHEAP PREFERENCE
For those who like a preference share well under par; the 5 per ent. Li preferences of Edward Lloyd Investment look to me good alue for money around ios. 9d. This company derives its income , rorn its holding of ordinary shares in Edward Lloyd, one of the large paper-making undertakings in the Bowater group. Edward 1 Loyd has itself to deal with preference arrears, but, as I have stated, ,s now about to formulate plans for doing so. This opens the way o a resumption of ordinary dividends which, in turn, will mean at the Investment Company will begin to draw a revenue from
.Is shareholding. With arrears dating back to May, 1939, these 'references are a promising lock-up purchase both for dividends and capital appreciation.
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