Evening star. [volume] (Washington, D.C.) 1854-1972, 1905-04-09
Finance and rade IN
Markets of the World

NEW YORK April S-Prices underwent
n sharp reaction in the two hours of to-
days trading on the stock exchange. There
was no development in the news to offer
clear motive for the selling, which was
based more on the doubts in the minds of
traders over the rate of the advance dur
ing the latter part of the week than on any
change in condition affecting values. Ameri-
can Smelling particularly showed the eff
fects of the recklessness of the recent spec
ulation and after rising two points relapsed
violently
An intimaton was broadly conveyed that
there was a hitch in the long-dscussed
southern iron merger and the stocks in that
group collapsed. In Union Pacific it was
very clear that the attempts to lift the
stock We're meeting with the obstacle of
practically unlimited selling orders The
prevailing sentiment in the market at
taches great Importance to the movement
of this stock as leader, and the prospect
of opposition to further advance was not
relished.
There selling for foreign account,
and the depression abroad was attributed to
reports that a naval battle imminent
in the eastern seas. The possibility of an
important military event during the Sun
day interval prompted speculative holders
of stocks to tighten their load
The Bank Statement.
The bank statement showed the surplus
reserve unimpaired, but the reduction of
the loan item did not come up to expecta-
tons and the cash reserve showed a de-
crease of 81 200 in place of the expected
small increase. With the SurpiuS item at a
low stage the improvement in condition of
the banks is not sufficient to relieve the APP
prehension that the "A per cent call
money of Friday may not be an admonition
of some further stringency next week.
There a sharp drop in sterling ex-
change in response to this condition in
spite of the selling of stocks for foreign
account There was some rally from the
low point but the closing tone was heavy
Total sales of bonds. par value, 81, 100000.
The tone of stocks was dragging and hest
tating to some degree during the early part
of the week but developed increasing ami
nation and strength The hesitation was
more manifest and more persistent in the
railroad list than in the industrial section.
The spasmodic advances in a large number
of comparatively obscure industrial stocks
was of doubtful effect sentiment, but
when United States Steel preferred emerged
into prominence with aggressive and
sweeping advance the effect On
the general tone became more pronounced.
The Underlying Strength.
The underlying strength of the business
Snd industrial situation served as buttress
to the values of securities at all times, but
some modifying factors contributed to the
early mixed tone. The most effective of
these was the contention, asserted by an i'm
portant element among the commission
was already sufficiently high to represent
adequately the improvement in conditions,
with a danger that the process might be
overdone by the overstimulation of the
many unconfrmed rumors and mysteries
which had been the motive for extended
speculation in various stocks.
Even the confirmation of these rumors it
was urged, would be the signal for heavy
selling to take speculative profits while a
disappointment of the prospects held out
might lead to an abrupt reversal of position
IN the market on an extended account. The
unexpected news of the plan to issue new
Union Pacific preferred stock to the amount
OF S1n,U0.OO, thus doubling the present is
sue, caused a perceptible shock to the mar
ket. Union Pacific has been the subject of
more rumors and more active speculation
based on them than any other stock in the
market
Great as the variety of these has been,
none of them has. pointed to the preferred
of the correctness of the information on
which the great speculation in the stock
has been based.