The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-01-23
WALL STREET NOTES
Steel Business Shows Ten
dency to Break Records.
INSIDERS BUY COMMON STOCK
Orders for 10000 Tons Booked on
Monday - Reading Manipulation
Shaking Down" ShRres-Reported
to Have Been Successful.

New York, Jan. eff those in Wall
street who have been expressing concern
over the condition of the steel trade really
want 10 hear words of encouragement.
they may take heart from the fact that
so far from the earnings of the steel cor
poration showing falling off. the volume
of new business coming in Is nothing
short OF phenomenal for the season. On
the first business day Of the present week
the total volume Of business booked in
all departments amounted to 1000 tons.
This rs IN average daily rate would mean
1000 900 tons a week, a record that is not
unlikely to be reached. Wherever Wall
street got its idea OF a contraction in
the business, il certainly can find no con-
frmation of its views in the way orders
are coming in to the largest interests In
the trade, Those who know the real state
of affairs see no indication of any re-
verse OF the present prosperity that has
been enjoyed by the trade for months past
70 neither are they bearish on the stock
The buying OF steel common in the past
day or two was even better than 1t looked.
A member of the original bull party in
Reading expresses the opinion that the
selling on Monday. which carried the price
down to 124 was in the way of manipu
lation designed 20 shake out an account.
the position Of which was not very strong.
In other places the same opinion is eX-
pressed. but the intimation is added that
the movement was entirely successful.
They went after line Of stock. and
they got It," is the way the matter is
spoken of by some who profess to be-
acquainted with the facts, but it may as
well be said first. as last. that the trading
did not indicate any large amount Of sell
ing. beyond what it is said really repre-
scented manipulation to get the price down.
Assuming that they got IL" they must
have obtained it privately instead Of
through the regular transactions on the
noor OF the exchange.
The real point in regard to the break
in Reading is not so much how the shake
out of an alleged weak speculative ac-
count was accomplished as whether it
was accomplished at all. If the stock
was taken over privately, it has proba-
bly, gone into very strong hands, and II
il was liquidated in the exchange. the
greater part Of 1t must have gone into
strong boxes, anyway But If the bear
Ism manipulation was nothing more than
a movement to facilitate the covering
of shorts. the position may not be par
ticUlarly strong. as with the short inter
est eliminated the stock should he more
vulnerable In the next decline than it
was in the last one. Not the least mys-
FERROUS part of the affair is that long be-
fore the stock broke to 125 there WAS
tip that II would be d good purchase at
that level. The usual course in a mar
ket movement is to withhold information
until such progress has been made that
the insiders can hand out the stock with
the information and profit by the opera
ton Here. apparently. the outsider was
let in on the ground floor a fact which
some traders regard as cOnfirmatory -
the theory that a line OF stock was taken
over below the market so that there was
profit even on sales made at the very
lowest level
The after effects Of yesterdays break
in Interborough-Metropolitan was shown
in the demand for the stock In the loan
crowd when it loaned al per cent this
morning, although the regular rate was 3
per cent. Conservative brokers saw there
IS but little OF the stock afoat in the
street nowadays on account OF the alb
sorption since the price dropped 10 about
this level after the withdrawal Of the
peg last summer.
Rumors that the dividend on Southern
Pacific would be raised to per cent 1T
the next declaration in February required.
but were not credited in well-informed
quarters, the best opinion being that the
rate would not be changed before mid
summer. It was stated on good authority
that a considerable amount Of the stock
has been shippedd abroad, representing
purchases made in the last few days. This
means the withdrawal Of so much from
the floating supply in Wall street and the
strengthening Of the technical position.
L0ndCn's interest In Southern Pacific mas
been stimulated by the buying of privi-
leges by New York houses. good until the
end Of September. which the foreigners
look upon as an indication that something
of Importance concerning the stock will
transpire within the period covered by
the options.
With easier money conditions in Europe.
it is expected by international bankers
that the foreign demand for American
stocks will improve. and that buying for
the other side will constitute an important
element OF support for our market on
any important recession from the current
level of prices. The return on several
high-class stocks is now so large, relative
to the market prices, that the European
speculative investor is again beginning to
make inquiries. for he likes our stocks on
account Of the freedom with which they
move, and buys them freely whenever
the yield on the purchase price is high
enough 10 meet his idea of a fair return.