New-York tribune., 1906-05-14
THE FINANCIAL MARKETS.
STOCK VALUES RECOVER LOSSES OF THE FRISCO
SLUMP.
Strength zcOy Expected onetary Conditions Yay
ImproUed-7rade Prosperity Continues.
THE WEEK IN WALL STREET.

A
Stock market values advanced practically
without interruption throughout the week. and
as consequence many OF the active securities
recovered the losses which suffered in the
! slump OF the two preceding weeks. particularly
in the case OF the high grade issues such as
Great Northern, Northern Pacific. New York
Central, Pennsylvania and Union Pacific. Read
ing which cannot be classed with the stocks just
named, also enjoyed marked improvement. sell
ing in the neighborhood of 20 points above its
low figure. the movement representing in great
part aggressive attacks against the large short
interest. Though the greater part Of the weeks
increase IN values due to speculative opera
tions, there was a considerable amount Of actual
investment buying. while there also was large
accumulation OF low priced issues by interests
who believe that the equities in these shares are
expanding in value at a rate which warrants
much higher quotations. On the advance heavy
sales OF course. were made for the account of
people who bought securities on the recent de-
cline in order to support the market but the
remarkable ease with which the sales were alb
sorbed created great confidence in speculative
circles over the underlying strength and future
stability OF the securities market.
The elimination Of the anthracite coal con-
troversy, the settlement of the lake strike. the
favorable report on winter wheat and the grow
ing in money were influential factors in
inducing speculative activity. while they also
served to create a better market for all grades
of investment securities for actual investment
account. Notwithstanding the fact that there
has been a substantial rise in quotations, COM
mission houses at the end Of the week were ex-
tremely bullish in their advices to customers
suggesting the purchase of stocks on the theory
that all unfavorabIe factors have passed into
history and that the way is now clear for a sus-
tained upward movement. Nevertheless, If may
be well for spectators to temper their enthu-
siasm with caution. It is not unlikely that the
weeks continuous rise in quotations will be fol-
lowed by a speculative reaction. and It is we'll
20 bear in mind that reactions after period Of
sharp advances are generally large enough to
wipe out small margin accounts The idea that
there win be no further liquidation in connection
with the losses sustained in the San Francisco
disaster is held in many quarters. but there are
a few people who are not yet satisfied that the
effect of the fire and earthquake has been wholly
reflected in the Wall Street markets. In general
business. however. cheerful times apparently are
ahead.
An easier tendency in the money market last
week was reflected in higher rates for foreign
exchange. and as a consequence of the latter
movement further engagements OF gold for ex-
port to the United States from Europe ceased.
In the early part Of the week foreign discounts
were firm and the price of bar gold and Amer
lean eagles was advanced. while on Friday there
was reaction both in the price OF money and
gold in London. indicating the improved condi-
tions in the Uniteu States and suggesting the
improbability of further demands from New
York for London's precious metal Since the
beginning Of gold imports there has been en-
gagged S4S37000O and in the same time there
has been sent to San Francisco 1000.
Apparently the urgent needs of the stricken
city have been satisfied, though in the event Of
an enormous run on the San Francisco banks
upon the opening OF business at that centre 1t
may be necessary for the transfer OF further
sums of money from the East and in view OF
this possibility It may not be wise to predict a
long period of easy rates for funds. The money
market however is in much better position
than it week ago. an indication of which
is presented in the movement of time rates,
which are now about per cent under the high
level Of the year. The decline in this department
of the market was considered one of the most
important financial developments Of the week.
especially for operators in securities. and If
there should be a further lowering of quotations
doubtless there would be a much heavier de-
mand for securities for the account of investors
in all parts of the country.
While the money which will be used in the
restoration of San Francisco will move actively
suppose that the market for call funds will de-
cline to a per cent basis in the immediate fut-
ure. Indeed. it is the opinion Of the best in
formed bankers that money will be in such ac-
tive demand in the balance of the year that even
the summer months will not be marked by ex-
treme ease in quotations at the leading finan-
cial centres. Nevertheless the chances favor an
increase in the holdings Of the local banks, and.
based on present conditions and indications, there
will be no disturbance in the market until the
fall at least, when the demand in connection
with the financing of the crops may bring about
period of acute stringency. Wall Street is not
worrying money market possibilities.
timent in financial circles being optimistic this
feeling. Of course. being intensified by the i'm
provement which has taken place in the prices of
securities and by the failure Of the recent stock
market Generalization to bring about serious
trouble among the banks and commission houses.
New York bankers are actively discussing the
proposition Of forming a syndicate for the pur-
pose Of financing the rebuilding of San Fran
cisco, and the amount of money which will be
used in such venture doubtless will be large
enough to become an important influence in con-
siderations affecting the future Of the Eastern
money market
The large expenditures which will be made
in the reconstruction of the Pacific Coast city
doubtless Will add activity to an already ex-
banding industrial situation. especially in the
iron and steel market. which will be called upon
to supply an enormous amount of structural ma
terial. II is encouraging to know that the re-
cent distress among speculative pools on the
Stock Exchange has not been followed by trou-
BILE in the world OF business. the Wall Street
furry having been confined entirely to the limits
OF the speculative community. Reports of rail-
road earnings prove that the volume Of business
in all departments OF trade is heavy while f1r-