4 JULY 1931, Page 40

Financial Notes

MARKET FACTORS.

AFTER showing further strength on Monday markets were inclined to react a little on the fears of a breakdown of the Hoover proposal, through the French insistence upon certain safeguards which President Hoover considered would not fall completely within the spirit and purpose of the original offer. The appearance of our own Revenue Returns, too; showing that tax receipts for the first quarter of the year were dropping behind the Chancellor's optimistic Budget Estimates, helped to produce a dull tone. Gilt-edged stocks weakened and industrials reacted slightly, while internationals all went back. But the fact that in the stock markets and in commodities such a sharp rise should have been seen as that which followed the announcement of the American offer has dissipated the very gloomy feeling which has long prevailed. The spurt, while mainly a result of the closing of bear accounts, should

discourage their re-opening upon the same scale.