The daily morning journal and courier., 1907-06-10
LATE FEATURES OF
 TIE STOCK MARKET Morgan Buying U. P. and
 Other Rumors. SENTIMENT BETTER, A Further Rally Expected Unless Crop Report is
 a Damper.
SENTIMENT BETTER.

New York, June 9,--The report of the
 agricultural department on the condi.
 tlon of the cereal crops, to be giyer
 out tomorrow is awaited with great
 interest in the financial community
 The expectation that it will show a con-
 siderable improvement in the condition
 or the wheat crop over that shown a
 month ago has played considerable
 part In the better tone of speculation
 In the stock market this week. Re-
 ports of condition by several of the
 state authorities covering the same
 period as the expected government re-
 port and Which show a material better
 ment during May, furnish ground for
 thls expectation. Weather news dur- 4 lng the past week also has indicated
 NAat some progress was being made in
 making up deficiencies in the tenpera-
 lure and moisture which has been
 against the wheat crop. The govern
 ment report on cotton condition giv-
 en out early in the week was not re-
 garded as confirmatory of the extreme
 pesslmism which had been rife in the
 lrade' Ground for hope of much iln
 provement in the cotton prosnects
 With favorable weather conditions fol-
 lowing the period covered by the gov
 ernment report was also indicated by
 vhe report and the weather news since
 mas been better. Altogether, then the
 week has been distinct improvement
 Tn the feeling rgarding the crop pros
 pects and anxiety over a possible
 absolute failure of the crops has subsi-
 ded' The problems of the crop excite
 ment are of the first importance in
 shap1ng the financial disentanglements
 Which are in prospect and the specula-
 live sentiment is correspondinelv
 frightened by this betterment of pros. poets.
 Another substantial factor in the im- provement of sentiment is the better showing of the railroads in reports of net earnings in April. The gross earn lngs of railroads have shown no sign of impairment at any stage of inc doubts which have overspread tha financial horizon, the heavy movement or traffic being fully sustained through out, But the rate of operating expen- ses by reason of rise in prices of ma terial and labor had expanded so much Tn excess of the gross increase. I'D to the April showing, that grave misgiv- ings had grown up over the ability of some of the railroad companies to keen up the present rate of dividend disbur- sements, with the threat to the intee- rity of net earnings thus indicated This tendency of railroad net earnings Tn the recent past has been responsible in no small part for the impairment of credit which has made the raising of new capital for extensions so difficult and so costly. The turn upward in the tlde of net return to the railroads is therefore of great influence in increas- ing confidence due to the weather is partly responsible for the amendment of the extravagant cost of operation which was eating up profits. Conges- ton of traffic has been relieved to some extent, with help to the rate of cost of transportation. New freight classification going into effect also in- creases the rates to the railroads in various directions. The growth of con- fidence in values has not yet prompted large absorption of securities outside the professional class of operators, and their activities are largely confined 10 a few highly speculative securities. The bond market has failed to reflect any awakening of investment demand up to this time. Dissolutions of under writing syndicates are still reported from time to time with a large pro- portion of the unwritten bonds on hand for distribution to members, with pri- ces for the bonds ruling in the mar kets at figures far below the under writing. That much remains to be ac- oomplished, therefore, towards the ab- sorption of the congestion in the bond market is evident, Substantial im- provement in the market for bonds is awaited as the decisive evidence that the troubles of the securities market are in the way of final amendment.
 The continued outward movement of gold helps to keep opinion unsettled over this phase of the situation. Money 'ates. on call and for early maturities Ire easy indeed, but the high rates still paid by corporations for capital accommodations and the large capital requirements known still to exist make he flow of gold reserves from this market seem something of an anomaly 4 good deal of attention has been &C., 'orded to contention put forth by he National City bank in its monthly : financial circular that this country is / a state of bank note in- / iation and is thus helping to expel / old from our reserves. The same au- hority alleges that a practice has / rown up among national banks of bunting notes of other banks in their 4 eserves as lawful money, which they ave no legal rights to do. 4 While some slaekening in the rate f trade activity is acknowledged, 4 here has been nothing like the re- 4 ction that was dreaded after the first dmonitory symptoms made them elves felt in the stock market. The A Fders for iron and steel products are E AraS taI o1T ss,4-