New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-07-31
STOCK MARKET REVIEW
Break in Illinois Central After
Dividend Cut Affects List.


were evidences Of profit taking. which
held the market within limited range
and kept prices under a check. The
well known Wall Street theory that II
Is wise to sell stocks on good news was
put into execution in the instance OF
United States Steel. which opened at
an advance on the excellent report OF
quarterly earnings made public late on
Tuesday. The London quotation on
Steel sent over was higher than the
openink price here, and the stock failed
to reach the London level. while traders
were inclined to think that the highly
favorable earning statement had been
discounted
During the second hour the market
had symptoms of strength. which indi-
Gated a further rise; but a break In
Illinois Central, az the result OF de-
crease in the dividend from { per cent
to a per cent basis. restrained the up.
ward movement, and the course or
trading assumed a desultory tone dur
ing the remainder Of the morning SEES
sion. Illinois Centrars decline yester-
day carried that stock down to the
lowest price Il has sold at in practically
a quarter Of century. On December
%. 1889. It was quoted at 100; but
going back to 1877, Illinois Central
sold in April Of that year at 4O12. which
was It's lowest price dating from 1910.
The highest price at which the stock
has ever sold was on June l. l9ob'
when Il reached 1S412. The reason as
signed by the directors FOR reducing the
dividend is an increase in expenses due
10 the foods Of January and April OF
this year, and considering that view
the decrease in the dividend was not
reflection on business conditions nor
the normal prosperity Of the road
The effect Of the dividend cut, how
ever, was depressing, as II did not stop
with the Illinois Central. but was car
ried over TO Union Pacific. which owns
about S3OOOO,OOO Of Illinois Central
stock. and the reduction in dividend
rate will necessarily affect the income
Of Union Pacific General weakness
throughout the list was manifested
during the early afternoon, and United
States Steel common sold down TO
point which absorbed ell its early gain.
In other stocks. such as Reading. st.
Paul Canadian Pacific, Lehigh Valley
. e 10 t,,A,otrfalC lOCCoa 0f
a point or more in each were recorded.
Some recoveries were made in the late
trading. but at the close declines
were exhibited in most Of the stocks
traded in.
The Street was taken by surprise by
the very large net earnings which the
Steel Corporation reported for the
quarter ended June 80. Many esti-
mates had been made, the largest
being around S3S, 0O0,0OO; so when the
profits were shown to be S41.2l9,Sl3
sentiment was turned TO the favorable
side in London and in this market
The Importance OF the remarkable
prosperity Of the Steel Corporation will
be appreciated throughout the country
as It indicates that generally sound
conditions of business have prevailed
during a period when the contrary was
supposed 10 be experiencing gradual
depression Commenting on the Steel
Corporations earning statement. THE
Iron Age" in its advance review says
the fact that the amount Of earnings
has been exceeded in only one other
second quarter and in but three other
quarters In the corporations history
Is reassuring. Such a showing from
period so recent and the knowledge
that current operations are yielding
profits fully as good, even though new
buying OF finished steel is less than
half current shipments, must be favor
ably interpreted.
Other matters in which Wall Street
continued to take an interest included
the reply to Secretary McAdoo's at
tack on the local banks by A. Barton
Hepburn and the crop conditions
throughout the country. The local
money situation remained substantially
the same. with little interest in either
.tr,. or COLL loapa