The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-05-22
FINANCIAL AND COMMERCIAL.
THURSDAY. May 81

Prices AZ tne opening VI WIG o'oSh Hi" he'
this morning were dull, then weak for
| brief period under a renewal OF what might
have been liquidation but which looked
more like drive by the bearish element
for the purpose of covering short contracts
and then turned strong and remained no
during the day. Buying for the account
Of the most prominent bear operators ana
for London houses was the feature OF the
DAYS business The greatest rally was,
, naturally, in the stocks that had declined
the most The London buying was scat
Y tered throughout the general list ana was
chiefly noticeable. perhaps. in the Erie
shares The days purchas by foreign
houses were conservatively estimated at
rs, 900 shares, and during the last two weeks
have amounted to fully 100000 shares.
The very friendly feeling which English
buyers have recently evinced toward
American securities was, OF course, further
encouraged to-day by the long-e1pected
reduction of the Bank OF England's mini
mum rate of discount to -, Yer cent
Whenever the cotton market to-day
was firm the stock market hesitated, and
when in the afternoon the prices OF the
cotton options broke heavily the greatest
gains in the prices Of securities were made.
All this is proba bly, more than coinci-
dence. While the stories that have been
current, particularly the rumors afloat
yesterday as to the embarrassment OF
Wall Street spectators by reason of the
upward movement In cotton, have been
grossly exaggerated there has been this
substance to them. that for two months
past many Of the professional specula-
tors in Wall Street. tempted by the high
prices prevailing for the distant options in
cotton, have made sales of future deliveries
of the staple which. as circumstances de-
veloped proved unwse. Nearly all Of these
spectators treated the matter as di-
version from their regular business and in
very few instances entered into it as upon
a campaign. During the last two weeks
they have been content to taxa their losses,
which have been comparatively small.
The chief influence Of the cotton speculation
in the stock market has been of a senti-
mental character. People did not know
to what lengths the speculation might not
proceed and what might not happen when
the inevitable smash came. The general
judgment to-day. therefore, that the specu
ton in cotton had collapsed. was accompa-
MED with decided relief. Prices of the
various options on the Cotton Exchange fell
from Is to 85 points, due to the operation,
apparently, of two causes. One OF these
was the very large selling. estimated at be-
tween $1,000 and 40 900 bales, of spot cotton
by the agents Of the mills in Lowell, where
1900 cotton operatives are out on strike
Those in charge Of these factories made up
their minds. apparently, that the best thing
for them to do under present conditions was
to dispose of their cotton stocks or a fair
share OF these stocks at the prevailing
high prices and run their chances Of getting
them back again when. later in the year,
their operatives conclude to return to
work. The other factor referred to, and it
was probably as controlling as the
one first named, was the inability
Of those who have been carrying on
the speculation for the rise in cotton
options to obtain requisite funds for the
purpose. 1t is known that financial sup
port was refused to these operators yester-
day by at least one great bank in the city.
and ii is not impr obable that accommo-
dation that has hitherto been extended
in other quarters has been curtailed. While
further decline in cotton prices seems
probable, the best judges OF the situation
that which followed the Labouisse and
statistical position OF cotton is too strong
for such an event
Another matter which greatly helped the
recovery Of prices on the Stock Exchange
to-day was the weakness of foreign ex-
change. Sterling here fell to point which
largely II not entirely dissipated any profit
In gold exports from this city. Any further
fall in the price of cotton would undoubtedly
bring about a resumption OF the cotton
exports, whose cessation In the last six
weeks has been one Of the chief sources
Of the strength OF sterling here and the
reduction Of the Bank OF England's rate. as
marking a lessened demand for money in
London. has. of course. decided bearing
upon the foreign exchange situation. To-
days weakness in exchange was due to the
large offerings OF bankers and stock
bills. the latter. OF course, representing
the drafts made upon London houses for
the payment for the securities recently pur-
chased here. 1t should be said, however,
that there is n good deal OF scepticism
az to whether all the buying OF stocks
that has ostensibly emanated from London
recently has been genuine. and how much
Of it, anyway. has been for investment
rather than for speculation. There Is no
doubt that some, at least, Of this London
buying has been upon orders proceeding
from this city.
The Erie issues advanced more than any
other stocks on the list to-day. and for
the peculiar strength OF the Erie shares
there IL, az has been often pointed out In
this column abund ant reason. The Eric
earnings are very large and the prospects
for the development of the Erie property
are very great. While no official announce
ment has yet been made concerning the
matter. 1t is generally believed that the
Erie first preferred stock will in July next
be placed upon I per cent. basis, this
action being preliminary to the dissolution
OF the Erie voting trust. The Erie issues
advanced from two to three points to-day
and the other active stocks from one to
two points. ST. Paul common alone Jagged,
and the fact created not little comment.
Despite to-day's market rebound it cannot
lie said that sentiment in the financial com.
munty regarding the future OF the market
or the main facts Of the financial situation
has suffered any decided change. A rally
in prices is due and overdue. but whether
anything more than rally can be expected
seems very doubtful. All indications are
that nothing has vet happened to excite