The sun., 1903-02-06
FINANCIAL AND COMMERCIAL.
THURSDAY, Feb.

Several things happened to-day TO add
to the improving character OF the stock
market. Chief among them was the deci-
sion Of the New Jersey Court Of Errors and
Appeals reversing by the unanimous vote
OF it's members the decision of a lower
court which restrained the direct ors OF tho
United States Steel Corporation from
carr wing into effect the plan for converting
500 900 oaO Of the preferred stock of the
corporal ion into bonds The decision was In
what is known as The Hodge case; and the
issues therein. while subs; antially the
same as in the Berger suit, previously
decided in favor OF the Steel Corporation.
still presented enough points Of difference
for lawyers to wrangle over, and while II
was pending, effectually prevented the
execution of the bond conversion plan.
All obs, acles in the way Of the accomplish
ment OF this much desired purpose by
the United States Steel direc; ors are now
wholly and finally cleared away and as the
wisdom and advisability of the plan has
been clearly demonstrated during the
last year. there is little doubt entertained
in the financial community that the
directors will at once proceed 10 put II
into effect BY IL the fixed charges OF
the Steel Corporation will suher an
annual reduction Of 3l50O,00O and the
corporation will obtain In an easy and equi'-
able manner large sum OF money for the
purpose Of harmonizing its different plants
and for making improvements upon them.
The terms Of the proposed conversion are
Of course, extremely advantageous to the
present holders Of the United States Steel
Corporation's preferred stock. These stock
holders will have the right to convert two
thirds of their holdings into second mort
gage bonds of the corporation. bearing
interest at the rate Of 9 per cent. and as
the bonds will probably sell in the market
Mt not less than 95, the cost to the preferred
stockholders of their remaining shares Will
be greatly reduced from that indicated by
present market quotations. In the sense
that the plan will greatly reduce the hxed
charges of the corporation the common
stockholder will also be directly benefited.
Semi-official announcement OF part, AZ
least, OF the much discussed Rock Island
Union Pacific combination was made to-day
It was admitted in authoritative quarters
that the Southern Pacific Railroad Company,
controlled, Of course. by the Union Pacific,
had sold to the Rock Island an interest in
the Houston and Texas Central Railroad
ines. taking its pay part in cash and part in
securities. II is believed that traffic
arrangement hes also been contaminated
betw the Union Pacific and the Rock
Island people. The transaction in Houst n
and Texas Central is doubtless advantageous
to all parties concerned. 1t means that the
Rock Island will not be forced 10 go TO the
Axpense Of building a railroad in the terri
tory named, and that the Southern Pacific
obtains a good price for possession that
was of no particular strategic value TO
itself
The third important development OF the
day WAS the extremely favorable reports
OF railroad earnings for December and
January. The net earnings Of railways
for December are showing decided improve
ment over those for November and it now
looks as though the net decrease in Deem
her earnings Of the railroad systems Of the
country az a whole would be small, If in
deed a net increase is not recorded. The
Illinois Central reported q net increase
in December earnings OF Sl4s,8n md n
gross increase in January OF e e2o
The Norfolk 1 Westerns gross increase
in the fourth week in January was $i32,-
s71. while the New York Centrars gross
increase for the month was Ss3s ,43i The
Southern Railways increase for the month
was 500, $50. and for the last week OF the
month Ss1, ,63l. The Louisville and Nash
vile reported an increase In gross OF ti59,3A
for the fourth week OF January and Of $284.-
oe4 for the entire month Perhaps the best
statement, however. was that Of the Man
haitian Elevated Railway Company. which
exhibited a gain in net earnings for the
quarter ending Dec. 81 Of S423,559, and
ciecrease of nearly $50 900 in operating ex-
pcnsee, despite the fact that the coal con-
sumed by the engines OF the road cost $780,
900 more than for the same quarter in 1901
Such an extraordinary showing can only he
accounted for by the economies made
possible by the recent installation Of cleo
trical power.
The Bank Of England's minimum rate Of
discount remains the same. but the weekly
report of the binks condition is strong
London was heavy buyer of stocks to-day
on balance. the purchases being mostly of
United States Steel preferred shares. The
stock market was broad and active from one
end Of the day to the other. The features
were the Steel stocks, the Reading issues
and all the leading railway shares. The
Wabash stocks continued their advance
because OF the recent developments favor
nbly efecting them. and the same cause
likewise served to stimulate Wheeling and
Lake Erie. The buying of Brooklyn Rapid
Transit was said to be for account of the new
interests which have entered into the man
agement of the company, while Chicago
and Great Western and Wisconsin Central
we're very strong for srecial reasons.
New York stock ExcnanEe sales. Feb ..
rrIrrp STATES AND STATE BONDS I'm 81 .ooos,