The Washington herald., 1907-05-30
WALL STREET NOTES
London Buying Sends New
York Prices Higher.
CROPS SHOW IMPROVEMENT


Union Pacific Is Leader in the Ad-
vance-Strength Also shown by
Reading-LOw Points Last Year OF |
Days Apart, and Same Held True
This Year-Gossip and Comment.
New York, May 29-LondOn bought |
stocks in our market to-day, and, by /
putting its own house in order, bid even
more toward encouraging a cheerful feel /
ing at home and abroad. The provincial |
operator whose affairs had become a mat |
ter of some uneasiness was helped out by |
a liquidatiRg company taking over his
stocks. and. with this action disappeared !
all the fears of an impending failure.
In addition TO the buying for London. a
few purchases were made by Berlin and
Paris. though it was thought possible
that these were really for the account OF
Americans now sojourning in Europe
They were nevertheless a very welcome
feature of the market
Improvement i'm the foreign sentiment
and Improvement in the weather for the
crops formed a combination that shorts
did not like, and. fearing a further i'm
provement in both directions over the
holiday, they busted themselves. from
start 10 finish OF the days session. with
reducing their commitments on the bear
side That they made some headway was
evident from the number Of stocks that
were returned by borrowers. although, Of
course. it was not at all certain that
there WAS not enough short interest left
az the close 10 permit Of the rally being
carried further.
Union Pacific was the leader on the ad-
vance, more than recovering yesterdays
loss and maintaining a strong upward
tendency 10 the end Of the session. Some
large lines Of short stock were covered.
but the closest observers failed 20 detect
any significant buying, although they
looked eagerly for signs OF activity on
the part of those interested in the un-
derwriting syndicate.
London took a moderate amount I'm the
carly trading. but most Of IL was bought
on orders 70 sell in the event Of an ad-
vance of a point or 50 occurring before
the close, and the probability is that 10y
the end Of the session the foreign position
in the stock showed hardly any net
change from the preceding night Spec
ulato-s who were active on the bull side
laid good deal of stress on the reports
| from Washington that the Interstate
Commerce Commission would not render
its report of the Hartman investigation
for several weeks. and endeavored %
make the most Of the respite from what
| Il was generally contended would not be
a bull argument
For a long time Reading seemed 20 bs
unable TO get away from the level Of
about IS. but II did eventually. and from
that time on the shorts covered freely
or real news on the stock there was
none. although tho large gain I'm earnings
made by Lehigh Valley for the month Of
/ April served as reminder of what the
I Reading system would probably snow for
/ the same period as a result of compari-
son with a time last year when mining
operations were suspended for several
/ days on account of the failure so reach
an agreement on the labor question
! Last year the market made a low
/ point on May and another on July g..
This year Il made low point on March
/ .. and another on May g. The number Of
days from the loves. point OF the May
break 10 the low point of July, last year,
was sixty-one. just the same number Of
/ DAYS have separated the break of March
. from the break on Tuesday Of THIS
week. Some brokers think the equality
/ In point of duration between the markets
/ movements year ago and its range from
/ low 20 low I'm the past two months may
/ be significant. L is az least intert ting
as indicating the possibility that the
/ forces az work last year and those az
work since last March have been some
what SIMILAR
When q severe break in the market is
checked by supporting orders the large
interests are forced to take a great deal
Of stock which they do not really want,
but which they buy for the sake Of turn
ling the course Of prices so that a condi-
ton Of semi-demoralization may not be
succeeded by q condition of panic. Those
stocks being bought for a purpose are not
| held longer than is necessary to accom-
/ plish that purpose and permit of their re-
/ sale At a profit. The resale generally
occurs contempora ne0usly with "A squeeze
OF the short interest. and both factors
combine TO bring about another decline,
which frequently put prices back % the
low level at which the support has been
rendered.
When the market broke on May last
/ year. the large interests put In support
ing orders and succeeded in bringing
| about a sharp rally until they had
bought heavy lines Of stock that they had
no intention Of holding permanently.
/ Having turned the market, they saw to
Il that the short interest could only re-
treat in the face of generally rising prices,
and availed of the demand for the cover
ing Of contracts TO tighten the load which
they had taken on during the break Such
an advance is purely artificial, and when
| the causes which made 1.-THE buying Of
stocks that are not to be kept. and the
covering Of shorts-ceasss TO be felt, It Is
natural that prices should drop back TO
about the level from which they had been
artiicially lifted.
| They We're lifted arti1Cially in May last
year, and from the uplift to the return 70
about the old level. took just two months.
They were lifted in the same way at the
end Of March this year, and from that
/ uplift on Tuesday was just an equal
period. After the second decline last year
came an important advance. because the
market had been thoroughly liquidated
1t remains to be seen that it is in similar
condition now.
It is one of the pet theories of Wall
street that the stock market cannot at
tract much attention from investors until
there Is a good investment demand for