New-York tribune., 1906-06-20
STOCK MARKET OPERATIONS.

AS a result Of the announcement Of the sue
cessful placing in Paris Of the Pennsylvania
S5O,OO0,00O loan, activity, accompanied by rising
prices. developed al the opening IN yesterdays
stock market. In addition TO the influence ex-
erted by the Pennsylvania financing, speculative
sentiment was favorably impressed with the i'm
provement in weather conditions in the crop
section, by the easier tendency in call money
and by the decline in sterling exchange, the last
named movement being due in part 10 the Penn
sylvania bond transaction. Advances of from
! 70 . per cent were common. and, as a rule,
early strength was we'll maintained throughout
the day final quotations in the leading active
issues being at or near the best figures The
general list was not affected by an aggressive
bear attack on Interborough- metropolitan,
which resulted in a sharp decline in this issue,
the downward tendency not being followed by
adverse news developments affecting the prop
erty The weakness was due entirely TO the
withdrawal Of support. which attracted active
pressure from the professional element At the
end Of the day this stock showed a net loss of
81, its final price being slightly above the low
est Strength in Baltimore & Ohio was due TO
the general expectation that the dividend will
be increased TO a per cent basis at the meeting
Of the directors to-day, while the upward move
ment in Norfolk & Western also was due 70 the
belief that the stockholders of the company will
a. no remote period receive a larger return on
their shares. The standard issues were strong
features, while a number Of the low priced stocks
were in demand 10 a moderate extent. The chief
support in the day came from the covering of
shorts, actual buying for public account being
confined TO small totals
The Pennsylvania Railroad has placed its
bonds in Paris at unusually satisfactory terms
and this fact, in connection with the statement
by the president Of the company that the road
would make no further borrowings in the near
fuure, naturally ought 70 help to restore specu-
latve confidence in the Pennsylvania securi-
ties. Recently Wall Street has not been favor
ably disposed toward Pennsylvania's shares and
aggressive traders have seized this opportunity
10 hammer the price OF the stock, with the re-
suit that in Mondays market the issue sold at
its lowest quotation OF the last two years.
Though Mr. Cassatt announced that while as
far as can be foreseen the company will not
have 10 meet large capital requirements for a
number of years, he qualities his statement with
the remark that before the end of 1908 the road
will be compelled TO raise upward Of S90000O0O
more money 10 pay off the 100000 note issue
which was recently negotiated in this city and
10 meet the cost Of the extension and terminal
plans in New York In the last few years the
Pennsylvania Railroad has increased its capital
obligations to an enormous extent. but in the
same time there has been a large expansion,
both in gross and net earnings, and on the basis
OF present net returns the company IS fully able
70 meet all OF its interest and dividend charges
with considerable surplus left over The only
question which worries some holders Of Penn
sylvania securities is the ability OF the property
TO earn enough money in years OF depression
TO pay its exceedingly heavy charges and its 6
per cent dividend. The road is fortunately stu
ated in regard TO traffic, inasmuch as its lines
II
business tapping about every industry in the
country, and a heavy falling off in earnings
could be brought about only by widespread busi-
ness depression throughout the entire United
States. The success of the Pennsylvania loan
doubtless will encourage the negotiation of new
capital issues by other companies and il is not
unlikely that efforts will be made induce Paris
bankers 10 increase their holdings Of American
securities.
Tho Pennsylvania loan, amounting TO $50
100000. Will be paid in monthly nstalments
and. OF course, the payments which VIII be
| made by the actual importation OF gold or
4 through the medium OF ordinary exchange trans
| actions viii be factors of some Importance in
| the local money market. The willingness OF
! foreign bankers 10 invest their funds in Amert-
| can securities reflects the growing confidence
| abroad in American institutions and x ought
| TO be considered a bull argument on stocks in
| general Were It not for the fact that prices
! OF most issues are now selling at q moderately
! high level. the influence OF the Pennsylvania S
Paris loan might be marked in the stock
market but the chances are il will increase the
| investment demand for bonds and serve to offset
| certain speculative factors which recently have
been working against an active upward move
| -nent in va.;es. In the foreign exchange mar
zet conditions indicate that foreign bankers are
again lending here BY the issue OF long bills