The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-01-18
STOCK MARKET INACTIVE
LITTLE INTEREST TAKEN By THE
PUBLIC AT NEW YORK.
Favorable Bank Statement Did Not
Create the Expected Demand-Fea-
lures of the Situation.


NEW YORK, Jan. 1.-THE public apathy
toward the stock market was indicated to-
day by the effect of the publication of the
very favorable bank statement. Traders
had bought a few stocks in anticipation
Of the good showing by the banks, but their
attempt to take profits after the publica-
ton caused a melting away of gains and in
some cases their total wiping out The
known movements Of currency from the
statements of the banks themselves indi-
Gated gain of sS,0oO,0O0 to 100000 in the
cash item. but the actual gain by the aver
age system of computation shows rise of
upward of s12,00O,OoO. Last weeks statement
understated the amount of the actual cash
gain by about the amount that to-day's
statement overstates it. which is not un-
usual when heavy movement comes late
in the week. This large loan increase is
normal TO the season, but there has been
no evidence of the employment of so large
a sum as $l4,0O0,0 900 in the market this week,
and 1t is supposed that syndicate opera
lions unknown to the people have figured
in this item. The increase of the surplus
amounts to $54O6.s The comparative ease
which has been reached in the money mar
ket left only a languid interest in the bank
statement. Only Missouri Pacific, Atchison,
st. Paul, Great Western 3, Louisville,
Great Northern preferred and American
Car made any noticeable show of strength,
and their gains were not well maintained.
International Power was run UP 8 points,
but dropped back 5. The market closed
irregular.
REVIEW OF THE WEEK.
The stock market has shown reaction
airy tendency this week without any dis
tinctly unfavorable developments in the
business situation to account for the change
in sentiment from the week before when
operators seemed to feel great confidence in
higher range of prizes and in the usual
January boom. The action of the market is
seemingly due to technical cause. The spec
ulative pools have desisted from their ef-
forts to boom prices or have found that
such further efforts as made do not attract
a large outside following.
The money situation seems clear, but the
consideration has reverted to investment
values, with a result of causing some cessa-
ton in the buying There seems to be
some divergence of agreement also among
the so-called pools themselves The make
up or the pools is never matter of de-
fined knowledge, but the dominant elements
in them are known to be capitalists and
wealthy men of ample resources. The most
influential class Is made up Of financiers
whose connections include not only rail-
road and corporation ownership, but in
fiuential ownership also in the great banks
and trust companies upon which the cOun-
try's money market is largely dependent.
Another class is made up of men of wealth
without such widespread connections in af-
fairs, whose stock market operations are
singly designed for the profit in the change
of the price levels, whether up or down.
The pools made up of the latter class were
under considerable pressure during the
money scarcity last fall by the banks and
large money-lending institutions. and were
admonished in effect that the money situa-
ton made 1T dangerous to make large
speculative commitments and that the time
was not propitious for pushing fotations
or projects involving new capital issues.
The disclosure of the purchase of control
of the Reading by the Pennsylvania and
Vanderbilt interests indicated that the pur-
pose of new aims had not been suspended
by large capitalists even during the period
when the activity of the stock market
cliques was thought to be repressed. The
renewed activity of this class following the
announcement of the Reading deal is be-
| leved to be tinctured with some resent
ment over the time lost for themselves in
disposing of holdings while available money
supplies were employed by more powerful
| interests for furthering their projects.
With easier money they have been prompt
to enter upon operations for rise, en-
market operators to lift the prices and at
tract an outside demand. The suspicion
has grown this week that much of the APP
pearance of activity and strength in the
recent market has been due to the use of
such expedients, rather than to competitive
buying to secure control of railroad systems
or maturing financial projects promising at
tractiye profits in the market. Some of the
pools in attempting to sell their holdings
at the higher level have demonstrated the
feeblenesS of the general demand, and have
made inroads on prices.
LOWER PRICE LEVEL POSSIBLE.
There are very few prominent railroad
stocks in the country whose rate of re-
turn is 5 or even Az per cent. at ruling
prices The growing cost of operating and
the rising tide of wages makes more doubt
full the prospect of increase in the rate of
dividend disbursement, even in cases where
there are large surplus earnings over the
present dividend. From time to time there
are sales at wide declines of so-called gilt
| edged investments which are so closely
| and judiciously held as to appear in the
market no more than yearly or twice a
year. The whole subject of the future
rate return on fixed capital is thus brought
| up for consideration, with the possibility
| of a REIMBURSEMENT to a lower price level
| for investment securities During the week
| the Louisville directors have declared the
| 211 per cent. Semi-annual dividend, the
| same rate as before the passing of control.
! Minority holders who followed the stock
up during the period of the buying had
| hoped for an increase which would fix a
rate of return consonant with the high
prices at which they bought the stock. 1t
would be remembered that the minority
stockholders were not included in the Of
| fer for the purchase of the majority of the
| stock. 1t was surprising, therefore, that
| there should have been heavy liquidation
| during the week in Reading after the an
neuncement that the control of that stock
was lodged with the Baltimore g. Ohio and
| the Lake Shore.
| The upward course of sterling exchange
| during the week has fixed attention on
| the PROBABILITY of an outgo of gold. 1t is
| known that an outgo in December was
averted only by extension of obligations
maturing TO foreign bankers. 1t was
even suggested that foreign bankers were
| cooperating with the bankers protective
pool here which subscribed $50, 900 for
emergency in the stock market, by agree
| ing to defer their demands for repayments
The present heavy outgo of grain and
| some buying here of stocks for London
account serves to ease the exchange situa-
| ton. But ii is believed the coming require
ments of foreign money markets for the
| fiotation of government loans will demand
some shipments of gold from New York
The heavy government disbursements at
| noon on contracts are believed to be about
| completed, so that the New York money
market is not expected to benefit the same
/ extent from SubtreaSury operations III