Italian stock exchange conditions

«The Economist», 5 novembre 1932, p. 847

The low-water mark in the Italian stock exchanges was reached on July 1^st, writes our correspondent, when the general index calculated by the Milan Statistical Office (December, 1925=100) touched 39.84. From that date an upward movement began, which culminated early in September, with the general index at 50.28. Quotations afterwards sagged, the movement having spent its force. The rise was unevenly distributed. In the banking group, the Bank of Italy took the lead. Shipping and textile shares were firm, but electrical issues showed a more limited rise. Agricultural and real estate issues were firmer after the collapse of a weak concern, the Società Bonifiche Ferraresi. The improvement failed, however, to interest the investing public. Transactions, if no longer strictly limited to professionals and to the financial groups (which are somewhat overburdened), did not extend beyond the speculative investor. Progress is being made with the financial reconstruction of some large companies. The Italgas, after selling its Milan Gas subsidiary to the Edison Company for 163 million lire, has been able to reimburse onerous banking debts. The Fondi Rustici has sold, for 47 million lire, the “Bonifiche Pontine”, a big reclamation enterprise which would have required further huge investments from its embarrassed finances. The public is buying fixed-interest securities to a large extent. A first issue of 100 million lire 5 per cent, bonds of the new Institute Mobiliare Italiano was readily subscribed privately. The rate of interest on new issues of mortgage bonds has been reduced to a maximum of 5 per cent. These are all good omens for the future, but there is no sign of a revival in equity shares.