New-York tribune., 1905-02-06
THE WEEK IN WALL STREET.

of values Conditions favor the investment Of
idle funds in stocks and bonds, and with 4 big
investment movement under way it is not sur
prising that speculation IS increasing and that
enthusiasm among public operators in the stock
market is growing. In last weeks market
there was an active speculative demand from
commission houses, while the more important
Wall Street interests made no attempt 10 con-
ceal their presence the bull side, the transac-
tiors OF the latter amounting large totals
distributed among both the high and low priced
issues. Various developments that In ordinary
Zines would cause declines in prices were not
considered or sufficient importance TO encourage
selling movement, as. for instance, the rate
war in the West and the talk of extra session
Of Congress in the spring TO pass railway rate
bills which apparently have little chance Of be-
coming laws in the present Congress. These
factors We're brushed aside as Of no conse-
0Bence, while the fact that many stocks are
selling above their investment worth. and in
many instances above mortgage issues. failed 10
change speculative temperament or 10 lead to
predictions that q change was imminent IN the
course Of valued. While there are many eX-
cellent reasons for the belize that even higher
prices will be recoroez in the current year. i
nay be lust ss well 10 bes- in mind that markets
cannot go in The same direction all the time. ana
That as far as the present market is concerned
speculative reaction. at least is due
Investors are placing their money in bonds,
which II prese7t prices are more attractive than
.he greater number Of high grade stocks. Bond
brokers report heavy demand for all first
class issues, and the different houses in the
Street are literally scramhling over one another
10 secure the handling Of the offerings of va
rious railroads that contemplate issuing new
mortgage securities There is therefore no doubt
regarding the success Of the forthcoming Atchi-
son bond issue or that Of the Pennsylvania; and
for that matter Of about any road IN the country
that intends 10 increase IT'S bonded debt.
Last Friday in less than two hours speyer
s. Co. ana Kuhn. Loeb & co. disposed Of
S75.0e000o Southern Pacific refunding bonds,
and the demand was so heavy that they could
have sold twice that amount in the day, the in
quiry coming from individual investors, banking
houses and corpora tions. 1t was the most
rnarkabIe bond success ever reported in Wall
Street and it ought TO satisfy everybody that
there is an enormous amount OF capital seeking
investment and that investors are confident that
conditions in the business world will remain
prosperous for many years 10 come. The railroads
growing, and they therefore warranted
in increasing their bonded Indebtedness Bonds
not rule selling AZ high level The
market offers many OF the best issues that
current prices return over per cent, but the
same cannot be said OF the greater number of
stocks, as IN the case OF the latter speculation
of the last few months has carried quotations
ror many Of the best issues 70 a level that re-
turns less than per cent When stocks go under
per cent level many conservative brokers be-
Iieve that the market is q better sale" than
buy ana one house last week, acting this
principle, put out big line Of Cleveland, Gin
cinnati Chicago and St Louis. when the stock
sold above par. thus reducing the return to less
than 1 per cent Stocks have advanced faster
than bonds but the demand for bonds is iucreas-
Ing so rapidly that higher prices doubtless soon
viii be brought about OF ifty-eight different
bond offerings made by various investment
houses for the month Of February, forty-nine re-
turn over per cent. while the balance yield
slightly under per cent.
Nowadays investors should ne content with
per cent investment. and the manner in which
buyers are taking this class OF security proves
conclusivel~ that The rate named is considered
satisfactory while In the stock department the
purchase of high grade stocks that return less
tnsn per cenr shows that investors are glad
20 secure gill edged issues, even if they are
compelled TO accept relatively small income
Trom their Investments There are. however Z
number oi shares that are quoted above the
per cent hass-shares OF great intrinsic merit
snd which, IL comparison with other issues of
similar actual worth are selling at cheap prices.
Canadian Pacific, for instance, a 6 per cent
fA
cent while New-Yori5 Central. : per cent in
v-stInent. is selling at better price and re-
turns only "a per cent St. Paul returns less
than pcr cent; so does Baltimore and Ohio.
Northwestern. Delaware and Hudson. Louisville
and Nashville, Reading and Union Pacific
Northwest Yields less than per cent, yet at
ats present price there are apparently some people
VINO are anxious 10 buy the stock This buying
however, is more for speculative purposes than
for investment. II is believed that develop
neents are pending that Will increase the specu-
lstive value Of the issue. The stock. neverthe-
less has more than discounted whatever may
happen in the Northwestern railroad situation.
aud speculstors might better place their money
in something cheaper. especially wnen a good
sized slump comes Northwestern will not main
tain It's present fancy quotation II may be le-
called that in the last great bear movement this
stock declined over 100 points. Comparing North
western, a per cent stock. with Minneapolis. ST
paul and sault ste. Marie preferred. also !
ger cent stock it VIII be seen that the latter is
* returns nearly 414 per cent. as against %
per cent Tor Northwestern. Excellent buying Of
the 800" shares was feature in last week 8
market
Fzilroad reports received ir the week as
rite were favorable. especially that OF the Penn
sylvsnia. company for the month of December.
As me Pennsylvania road runs through part
OF the country that has diversified industries
the earnings of the property are good re-
hection o. trade conditions throughout the
United states. and 81 Is therefore extremely en-
courasing 10 know that the company is now
Showing large gains over the same time IN the
preceding yesr and that the losses sustained
early IN 1904 were in great part offset in the
1Fa 80 49,.