The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1907-04-26
WALL STREET NOTES
Erie Preferred Weak With
ont Plausible Reason.
BEARIsH ON UNION PACIFIC

AAEEF DH4EAfskf--BOaHt aAAtf spec TIA
tion as 80 Attitude of other Inter
ests Chief Factor in a DuIl Market.
Reading Sensitive 10 influence.
New York, April 25.-About the most
notable feature of the market IN the fore
noon Was the weakness Of the Erie pre-
ferred stocks, which followed selling of
very moderate line by one of the West
eru houses The traders did not know
how 10 class this selling, but were in
cliaed TO think L Indicated nothing more
than that some bearish interests were
feeling around for weak spots Assum-
ing that such was the case. one seemed
20 haze been found here, for both the pre-
terred issues dropped down quite mater
tally without meeting any apparent sup
port. but some shrewd observers said
rhat what actually occurred was far more
convincing than any display OF open buy
ing by strong interests could have been,
for it was nothing less than genuine alb
sorpuon Of a kind that could probably
take care of all offerings. If the selling
was for short account. as was suspected,
then there was the interesting question
OF what might happen when the time
came 20 cover.
This remained unanswered at the close.
though the selling had ceased and a
slight tendency 10 rally was shown.
About all there was in the way Of ru-
NOR about Erie. apart from The familiar
prediction regarding the dividend cUrtail-
ment-was a report that the road had dis
pensed with the services Of "a large NUM-
Der OF men formerly employed on inn
proVemeut work along the line There
was really nothing new in this. Weeks
ago IL WAS announced that retrenchmeut
had been decided upon, and. indeed, there
were some brokers who believed that the
let-uD in construction and work OF SINH
lar character was likely 20 enliven Inter
est in the matters proposed in the public
utilities bill and perhaps bring about
some important notifications of that ma
tlIre. such money as the company Te-
quired for essential purposes il has al
ready arranged for, although certain
projects viii have 10 go over 20 d time
of less political strenuosity.
The traders were bearish on Union Pa
ciiic. not on account of anything that they
knew bearing upon the intrinsic value
Of the property, but on account Of the
supposed technical position of the stock
some of them had been forced into "a
covering movement on Wednesday, but
found that the stock came easily in re-
Spouse 10 their demand. and when a re-
action came in the last hour Of that
days session they put out their short
lines again Having taken a position they
tried TO find arguments 70 back IT up. but
were not particularly happy in their Sc
lection. They said the street was ful OF
the stock. but the market did not act
that way. Where there was so much
talk and SO little effect the talk bad TO be
taken with d good deal of suspicion. and
il was very naturally suspected that some
Of those who We're on the short side were
working for an opportunity TO get out
even-seeing they had very little prospect
Of covering their contracts at profit
When the traders take sides on stock
they can generally ind some good 70 say
in support of their position, but the most
resourceful among them nave been severe.
Is taxed lately % md something original
and ia their present operations against
Union Pacific their arguments have been
exceedingly weak.
What strongly tends 10 retard the
growth of bullish sentiment on Union Pa
cidc in speculative circles is the fact that
on the basis of its dividend returns the
stock sells about ten points below market
for the leading railroad issues This
might seem To he a reason why the street
should be bullish on the stock, but it is
really regarded as the reverse. The pro-
fessiOnal trader acts on the policy that
THE ticker tells the tale" and when he
sees Union Pacific selling so much below
an equality with the general market be
comes 10 the conclusion that there IS
something not generally known, bat
which if made public would explain the
difference.
From the nature Of the current COM
ment on Union Pacific il might be in
ferred that if the stock advanced relative
ly faster than the rest of the market IN
the next few months, the sentiment on
it would become bulish at AN Increasing
rate of velocity This would not be out
of line with occurrences in the pasta
fact which TetiTes the question Of how
far the ticker is TO be regarded as an
oracle. Instances are not wanting where
the instrument failed TO tell of accumu-
lation of a stock, but afterward made
a great display Of bullishuess when the
really important buying had ceased and
manipulation to get the price up for the
purpose of redistribution had begun
Reading acted in a way which COM
pletely puzzled the traders. When stock
was offered for sale the price went down
easily, but when even small quantity
was wanted the recovery was rapid and
complete The talk on the floor was
about short interest among those who
were bullish and of inside selling among
those who were bearish. Outside If the
exchange in quarters where there is gem
orally good information on Reading af-
fairs, the view taken of the market posi-
ton on the stock was that if any ore
felt bullish enough TO hug any stocks
Reading was as good as anything he
could lay his hands on. This opinion
was based on the earnings ard the con-
stanuy increasing value OF the anthracite
properties.
HTryTY yapY ppnnUrT