The Washington herald., 1907-04-16
WALL STREET NOTES
Failure Clarifies Market and
Strengthens Prices.
LONDON FIRST TO GET NEWS
Market shows Remarkable Resi-
IIency, but Pennsylvania Goes
Down Easily and Fails 20 Rally.
Smelling FIuetuates-Some Specu-
IatOrs Buy in Hope of Increase.

New YORK, April i0.-1Ne failure or W.
L. STOW & Co. this morning caused no
surprise The name of the firm had fig
ured in the bearish rumors every time
these took the form of reflections on the
standing of firms or individuals doing
business in the street. The familiar form
Of such rumors was: STOW s. Co. and
may be others will go TO the wall" Stow
& Co. have now gone. and there is no
name left TO be banded about with equal
freedom.
A curious feature OF the suspension was
that London appeared to have had the
news before it became public here. Short
ly after n:90 O'Clock a prominent house
received cable from its leading cor
respondent: Regret failure. Hope house
not important.
No failure had then been announced, and
naturally there was immediate inquiry as
10 the meaning Of the message, but pres
entity the exchange telephone rang and
word came from the board that the an
nouncement of the Stow suspension had
just been made.
A popular supposition to the immediate
cause OF the Stow failure was that the
hrn had lost heavily in its dealings in
privileges, but what had been current
gossip for a long while was that the firm
had really been in a weak condition for
the greater part OF the time since Mr..
Stow resumed business after his failure
IN 1893. caused by the decline in Mexican
Central. of which he was one Of the larg
est holders.
on the ground that the bad news was
out. the shorts started on a rush to cover
Just as soon as they heard Of the Stow
failure and prices advanced sharply from
the low prices of the opening. which had
been unduly depressed on account Of
selling that was in part liquidation, and
IN part speculation in anticipation OF the
failure that. both in London and in many
places here. had been very definitely ex-
pected.
The traders all turned in 20 work for
an advance Just as soon as the official
announcement was made from the ros-
trum of the stock exchange. recalling as
something that was interesting il not
important that when the house failed be
fore the market at once moved upward
OF course, the strongest bull argument
was that prices were so low that only
the fmminence Of trouble could keep them
at the prevailing level. and accordingly
when the supposed source of trouble was
located and its comparative insignifcance
made plain. a rally became the natural
outcome.
The remarkable residence with which
the market in the second hour not only
recovered its earlier losses. but rose TO a
level above Saturdays close, made it
plain that there were two sides to the
F md ne
would hereafter have TO contend against
greater opposition than they have been
obliged TO combat heretofore.
American Smelling and Refining showed
the widest fluctuations OF any stock on
the active list. opening at l25. decline of
nearly points from Saturdays closing,
its price dropped to 1235a. but afterBard
rallied vigorously until by noon it reach
ed l29is. an advance of points from the
/ lowest. and OF 25s points from the finai
quotation at the end of last week. Bear
stop orders were caught on the rise and
after the short interest had been driven
l To cover the stock dropped back 20 the
/ low level. although buying orders on a
scale down showed that it did not tack
| support. and this had the effect of reas-
! surIng. spectators who had bought i'm the
OF ht AttAi lla AltE AilN stAfit
/ but whose condolences had become dis
/ turbed By the apparent indifference OF
/ the insiders at the end Of last week and
/ IN the initial dealings to-day.
/ The supposition is that leading interests
/ IN the company think that the mere pros
/ pect of an advance to 10 per cent IN the
! dividend should entitle the stock 10 sell
materially higher and that if the pros
| pect fails TO advance the price. and hold
| it up. the actual declaration Of an IN
/ creased rate will come soon enough to
| justify patience in holding on.
One Of the most diseouraging features
! OF the market was the action of Pennsyl-
vania. This stock went down easily in
/ the general decline at the opening. and
/ failed to rally proportionately to other
/ prominent issues in the second hour No
/ bun could ignore this characteristic. and
its effect on sentiment was widespread.
/ London was heavy seller of stock. and
/ instead Of being convinced by the rally
! in the second hour, increased the volume
/ Of its sales. No particular reason was
/ given for the foreign attitude toward our
market beyond the very general one that
I It was believed abroad that liquidation
/ had not run its course. and that until il
had done this rallies could hardly be long
lived.
/ flood OF liquidation followed the rally
/ in Union Pacific. Where the stock came
from nobody seemed to know. but that
much of the selling was Of more or less
urgent character many Of the best market
! judges agreed. tt was thought possible
1 that the prospects Of the road being
/ obliged to do new financing 10 meet ma
turity Of the outstanding Oregon Short
Line notes given to Pennsylvania in pay
ment. Baltimore and Ohio sold by the lat
ter. had something to do with it.