New-York tribune., 1905-06-26
STOCK EXCHANGE
THE WEEK I'M WALL STREET.

oninion in Wall Street differs regarding the
Significance of last weeks sudden chaHSe III
the character of speculation. In some quar1eiS
IT is thought that the increase In dealings ieFeiy
represents q spasmodic movement on the part oI
tho Iarear interests 10 enable the marketing OF
stocks while in many circles it is belleVed thae
the expansion in business foreshadows period
of sustained bull activity. There was an eX-
cellent class of buying at times. trading was
we'll distributed and no great amount OF stock
was pressed for sale on the upward movement
factors which naturally increased the commence
of the people who believed that the marker mac
got out of the rut in which it had moved LOT
so many days OF course. the increase IN tile
dividend rate on Reading common shares plac-
ing the stock on a per cent basis served 70
create bull enthusiasm and it may be SAID Will
out fear of contradiction that the acuoh ol
+be Reading directors was the chief factor IN
returning the stock market to state of ANNA
ton. The increase in the Reading dividend
served to bring about n large buying move
ment in the Pennsylvania group of securities
and the character Of buying IN these issues was
such as to encourage activity throughout the
list Other important dividend increases Will
be made in the current year, notably in the case
of Norfolk and Western and Baltimore ana
Ohio, and accumulation Of the stocks that VIII
be affected by larger payments has been gong
on for a long time past 1t may be said on
the best of authority that the dividend on the
baltimore and Ohio will be advanced IN the
course of a few weeks, while the directors OF
the Norfolk and Western recently pracucaIIy
announced that at the next dividend period the
common stock would be placed on per cent
level The idea that the Pennsylvania COM
pany will increase its rate is not entertained IN
well informed quarters. but larger dividends on
the Reading, Baltimore and Ohio and Norfolk
and Western shares will help the Pennsylvania's
treasury as the last named company practically
controls the other three roads.
Conditions affecting the intrinsic worth Of Sc
curities continued in the week to move In a
manner that was extremely encouraging to the
holders of American railroad stocks and bonds.
Railroad earnings showed as q rule. large gains
over the same time in the corresponding year;
bank clearings were largely in excess Of those in
1904; the country's foreign trade presented in
dications of further expansion; the iron and
steel industry progressed on healthful basis
and reports from the agricultural section of the
country foreshadowed bountiful harvests. Al
though it is of course, too early to count abso-
lutely on large yield of spring wheat, corn and
cotton as there is much time before the maturi-
ties Of these crops for damage from weather
changes and insects, it is extremely gratifying
to know that present conditions in the grain and
cotton belts are promising. According to some
estimates that have been made, the cotton crop
will not run much above 100000 bales, but
the fact that there is an active bull party work
ing for higher prices the Cotton Exchange
robs these early estimates Of any value they
might otherwise possess.
Improvement in stocks last week carried the
average price of the leading active railroad
issues to above 120, compared with low point
in May of 114.52, while similar appreciation was
made by the chief industrial shares. the advance
tending to prove the theory that summer mar
kets, though duh generally, move slowly up
ward. In the last month trading has, until
within the last few days, been dull, but prices
nevertheless have enjoyed Improvement From
the middle of April to the middle of May there
was decline in the leading active railroad
shares from an average of above 127 to 11452,
so that from the middle of May to the present
time there has been a recovery of about one-half
of the preceding loss. The somewhat strained
relations between France and Germany over the
Moroccan situation failed to exert material eff
feet on the local market, despite the weakness
that developed the London and Paris eX-
changes. Bankers at this centre believe that the
trouble will be settled without military move
ments and as a consequence they view the out
look with no alarm. reflection of which is pre-
sented in the failure of securities prices to go
to pieces It must be admitted by the most
active bear that the stock market is in eX-
ceedingly strong position.
There is a growing disposition the part OF
borrowers on collateral to supply their needs
with time money rather than with call funds.
Time rates are considerably above call rates at
the moment, but that is a condition that may
change quite abruptly as the prospects favor
the theory that in the remainder of the year the
average Of time rates Will be below the average
Of call quotations. for it is probable that in the
crop moving period money viii be active, espe-
ciaIly as the outlook encourages the belief that
this years harvests will be unusually large.
Time money is affected by the inquiry for money
previous to and in anticipation of the need for
money in the crop moving period. while call
money rates are based current supply and
demand and in the harvest time the supply is
generally far short of the inquiry. 1t is not
uncommon for call money in September to get
up to 1s per cent and interest which is equiva-
lent to % per cent a year, and there is no rea-
son to suppose that in the coming fall there will
not be an advance in call funds to a point which
for a time will reflect stringency. AS an in
terval of higher rates for money is in sight 1T
is the course Of wisdom to borrow in expectation
of it TO the extent of possible wants. particu-
larly as the money thus borrowed on time may
be put out by the original borrowers on call at
q handsome profit. The foreign exchange situa-
ton exhibits less tension and the reason there
fore is found in the fact that the exchange
houses are once more issuing time bills with
comparative freedom. The bulk Of the bills that
are being put forth sixty and ninety day
drafts, although many are for even longer dates
The exchange houses count on being able To
cover or pay off their so called bankers bills
with grain and cotton bills later on in the sea-
son.
Winter wheat presumably. will be going