The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-07-19
WEEK In WALL STREET
FIRST THREE DAYS MARKED By A
PRECIPITATE DECLINE.
Most of the Losses Recovered on
Thursday and Friday-MOnetary
Conditions Are Better.

stock market was dull and professional.
The tone of the narrow speculation showed
sentiment very doubtful and hesitating.
Stocks were sold early in the day on the
assumption that yesterdays upward move
ment had discounted a favorable bank
statement, so that no further rise could be
expected after its publication. There was a
momentary rally when the statement ap-
peared, but the selling was renewed and
prices receded to a level substantially be-
low last night, closing dull and heavy,
without any rally.
Heavy liquidation in the stock market has
been in progress during the week, without
and Industrial situation TO adequately ac-
count for it. The weakness which developed
last week in New York Central on the as
sumption that its needs for funds must be
met by some new capital issues, with the
danger of repetition of the experience met
in the f1otation of the new Pennsylvania is
sue of stock, spread generally throughout
the list as it became known that various
railroad corporations had similar needs for
funds, which they were supplying by tenn
porary loans at high rates of interest.
rather than attempt TO sell securities at a
sacrifice in the present unfavorable market.
This was not strictly new situation, as
it has been known for some time that the
roads sharing in the new control Of the
Hooking Valley had given their notes on a
per cent. basis. The extension of a ma
turing service bond of the Burlington for
two years on a 4 per cent basis was also
a symptom of the disinclination OF rail-
road corporations to float large new is
sues at this time. The violent decline in
Pennsylvania shares in connection with the
new issue of stock was a conclusive Demon
stration of the unfit condition of the mar
ket to absorb new issues OF even high
grade, and the congestion Of new indus
trial issues in the market had been notori-
Gus for months. Nevertheless, acute I'M
easiness over the money situation. present
and prospective, was caused by the an
nouncement that the Burlington had bor-
rewed 100000 until next March, and the
Union Pacific s1O,OOc,Oo0 for a year and a
half on a per cent. basis. Many rumors
thereupon became current Of large pros
pective borrowings by various filroads and
of the consequent heavy inroads to be made
on money supplies.
The market took on tore OF demoraliza-
| to be felt of the consequences OF the unin-
terrupted shrjnkage of values. On that day
| the influential bankers in the clearing house
| association took counsel among themselves
full investigation of the banking situation
| had assured them of the soundness of the
| banking situation and the safety or the
position Of all city banks and trust com
panies so far as they could ascertain. The
| bankers were averse to making formal an
nouncement Of the result of such an In
vestigation on the grounds that unfavorable
| differences might be drawn from necessity
/ to take such steps. But the ground for con-
| fidence resulting from the canvass was
| commonly known in the financial district
| and had a notable effect I'm reassuring SEN
timent. Another fact that had a strong eff
feet in restoring confidence was the sharp
| response of the foreign exchange market to
the rise in the domestic money market. The
| strength which had been maintained in the
| exchange market and the sustained out
| ward movement of gold, in view of the dis
! parity In interest rates here and abroad,
| were indications of distrust on the part of
| foreign capital, which gave small hope OF
| relief for domestic money needs from that
source. But on Thursday there was pre-
cipitate break in foreign exchange which
transformed the situation from one OF APP
prehension of further gold exports to a
| prospect that gold could be brought in on
| occasion of need Foreign banking houses
| offered large sums of money in the New
| York market. 1t was learned that large
| proportion of the Union Pacific and the
I Burlington notes naQ Deen taken Dy lOI-
| eign capitalists The buying of stocks In
| the New York market for foreign account
was also said to be on liberal scale, al
! though this movement was more obscure
| as the decline in prices here had been sc
| much more rapid than In London as 70
afford profit in large transactions, sales ir
| London being covered here at the decline
| The rally in the stock market which result
| ed i'm the latter part of the week wiped out
| a large portion of the earlier losses ano
| some of the active stocks were lifted above
| last Saturdays level.
| some of the most sensational movement:
/ Of the week were in high grade invest
| ment stocks, which are seldom traded in
Some of these broke scores OF points on
few or on single transactions. Such opera
| tions NAV be accounted as showing some
urgent necessity for funds. But the limited
amount of the sales and the quick recov
/ cry in such stocks on the purchase o.
| equally small amounts precludeS the Idea
| of any general liquidation going on in these
| properties or any unfavorable developments
| regarding the properties themselves. The
| marking down Of market prices of the higf
| grade investment stocks and of mortgage
| bonds Is a clear intimation of the genera
tendency Of per cent interest t 1,e rates is do
| ment to hold securities on 312 or PEI
cent. basis. That there has been LIQUIDATION
| of securities by financial institutions WIKI
| a view to employing funds in the opel
| money market Is commonly assumed IL
Wall street. The needs of individual capital
lists to meet obligations on underwriting
|
| working capital are obvious in some con
| spicuous cases, are commonly inferred II
others, and are rumored with all degree
of reliability and unreliability in others.
Wall street processes some anxiety owe
the outcome OF the corn crop on accoun
| of its lateness, and the settlement of tn
basis for the coming years business il
iron and steel is eagerly studied. But Their
is little of the weeks sentiment in tn
stock market to be traced to influence
from outside business world. Reports o
railroad earnings and of current railroad
traffic are considered favorable. The pres
sure for loans and the rise in interest rate
with the resulting liquidation of market
able securities are accepted as evidence o
the undue expansion of credits of enter
prises some of them unsound, some o
them over-capitalized, some of them in to-
rapid anticipation of future growth, am
some of them for necessary improvement
and betterments to accommodate presen
business but the capital needs for which
had not been sufficiently allowed for.
The bond market was also weak, Wit
some recovery in sympathy with stocks
United States bonds were all unchanged a
compared with the closing call of last week
Following are Saturdays share sales an
the recorded price changes:
High Low Clio: