Los Angeles herald., 1906-07-17
.O|L STOCK DROP
PUZZLES BROKERS
GOSSIP ON ASSOCIATED HAS
BEEN BULLISH
Gigantic Japanese Contract Is a Fac
tor, Yet Shares Have Displayed
Weakness Which Mystifies
the Spectators

Quotations for Associated oil stock
broke below 40 cents a share on the
local stock exchange yesterday, going
down to the lowest point seen in several
months.
Sales were made at S9sl regular and
at S6, seller 80" that is. deliverable
within thirty days.
No particularly large blocks Of stock
came out. but the individual offerings
aggregated several thousand shares,
and several thousand more we're offered
at small fraction above the actual
selling price.
Traders We're myr.ified at the antics
OF the stock.
The gossip on Associated recently has
been Of a bullish character. but in the
face Of this the hares for several days
have displayed n weakness that has
been exasperating to the speculative
holders.
The report is current that the COM
pany will receive a large slice Of
a 20, 000 600 barrel contract recently
awarded in Japan, and while this report
has not as yet been officially confirmed
the source from which it comes is such
as to cause traders to give it consider
able credeuce. A semi-annual dividend
also is expected to be declared by the
directors about August l.
Other Concerns, TOO
Regarding the Japanese oil contract,
advices which have reached Los An
geles are to the effect that it was
awarded to the CT ciosa Oil company.
The Graciosa, however. is a compare
lively small con err and oil men say it
would have considerable diff
Guilty in filling a contract calling for
10000. 600 barrels without drawing upon
other concerns.
The Union and Associated companies
also We're bidders for the contract, and
both had representatives on the ground.
The Inference therefore is that an un-
has been reached whereby
the supply will be furnished by the
three companies and that no incon-
siderable part of it will come from the
Associated.
A few weeks ago Associated stock
was strong on information that the
was after this contract, with
a good chance of landing it.
The stock went up to 81, but after hold
ing there for few days it began to
sag back and recently has been quite
heavy. 1t is selling now seVsral points
lower than it did Immediately after the
San Francisco fire.
Union Oil Strong
What tends to deepen the mystery in
regard to Associated is the fact that
Union OIL is strong.
Traders are having some difficulty in
figuring out just why, if both companies
are. to share in the Japanese contract,
the share of one should be in good de-
mand and those OF the other freely sold.
t. ~ etD
garded as a "b'll" argument. but the
recent sharp advance in the price Of
petroleum is believed to have added
largely to the a;1ings of the Asso-
ciated company and this ordinarily
would be counted upon to advance the
price of the stock
The market for the shares, however,
is acting directly contrary to all these
and traders have been COM
PEELED to resort to the theory of man.
pulation for want of a better eXplana
ton of it's movements.
They seem to regard it as highly
probable that in view of the favorable
developments which are confidently eX-
pected the insiders should wish to de-
press the market as much as possible
for the purpose of accumulating large
amount of cheap stock.
Carried on Margin
A good deal of Associated is said to
be carried on margin " small traders,
and it is assumed that If the price goes
much lower the banks who are carry
ing loans with this stock as collateral
will call upon the borrowers to put up
more money or will sci. out their stock.
Associated is not gilt-edge collateral
by any means, and it is conceivable that
such a game is being played.
A large part of the sock sold on the
exchange yesterday '7ent into tle hands
Of one broker, a man who is said fire.
uuently to act for inside interests.
however, those traders who
went "short" of the stock around so
are reaping a rood rrofit on their deals,