Market notes
CUSTOS
The new Stock Exchange Account, which covers the budget, opened firmly and the general impression is that if Mr Callaghan introduces a neutral budget next Tuesday the equity share markets will soar, not because anyone is more optimistic about company profits but because the market supply of shares is still restricted and the institutional de- mand for them has been piling up, waiting for 11 April. There are, of course, a number of companies which said that they would increase their dividends if it were not for the official restraint. Now that dividends are free—subject to moderation—after July some dividend rises will, in fact, occur but there will not be a large number of them and some will be very modest.
The feature in markets has once again been the 'takeover' bids. The official confirmation that MONTAGUE BURTON and UNITED DRAPERY are having merger talks caused a sharp rise in Montague Burton to 29s 6d for the ordinary and 26s for the 'A' shares. Shareholders of Montague Burton have waited a very long time for this rise. They have known for a long time that they possessed very valuable properties—the 700 shops occupying some fine corner sites—but they have never felt sure that the management would produce the de- sired results. United Drapery has 520 shops and produces about 40,000 suits a week against Burton's 52,000. Obviously a merger would allow surplus properties to be sold and ration- alisation in retailing to be made good. Burton has perhaps been more successful than United Drapery in keeping profits up during difficult times, its incursion into France having been profitable.
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