The Bridgeport times and evening farmer., 1918-05-07
WatSOn'S Weekly
 Letter
5lIAllIlIIIIIIEliIIIIlIIIIIIIIIIIIIIIIINIIITIr1I


 Improvement in the market for se- cUrities has followed the condition suggestive of underlying strength to which we have directed attention re- cently, remarkipg that repealed re- sistance to published news unfavora- ble to the Allies was apparently sig ntfcant as to who had stocks. A liquidation position, according to pre- cedent, iS sooner or later followed by recovery in prices, especially when brokerage loans are as low as they have been and still are. At such times investment absorption, quietly and slowly going on, reduces the floating supply of securities to point where the speculative, finding offerings small, begin to bid for stocks, with a result that prices rise as they have been during the last few days.
 The outlook is favorable to further improvement of a conservative char acter in securities oversubscribed, which is expected to have a bullish effect on sentiment. Second, the rail- road contract situation promises soon to be settled in a fairly satisfactory manner. Orders for rolling stock are already being placed with American Car & Foundry, merican Locomotive and Baldwin Locomotive whose stocks are expected to advance to higher levels Further, bumper crops are suggested by the government reports now being made. This latter feature is probably the most important of the favorable factors mentioned, for great haEvests this year are vital to the Al lied cause. They also mean large traffic for the railroads of this coun- try and prosperity for the people.
 War progress is being made in a more rapid manner by the United States, but not to a degree that could be terned satisfactory. Charles M. Schwab has taken hold of the ship building in a vigorous manner, and we expect to hear good reports from this 2 department in the near future. John D. Ryan has not yet had time to re- ! organize the aircraft department from state of apparent chaos to one of ef- ' fbciency. The confusion there prior , to his appointment was deplorable, yet the German leaders were reported i, to dread the coming American airf1eet more than any other war power of this country something, we think. I that should have influenced experience ed ani practical concentration on this work. Warnings are being given,' 1, says financial news agency, against acceptance marketwise of any peace rumors from any direction It is re- ,i ported that German diplomatic A channels are again trying to manipu. I late the Vatican in this direction. Any ', activities toward peace now would be ! looked upon in Paris, London and -l Washington as made in Germany ii ' is intimated. We would be inclined to | take profits on stocks in case of g II peace rise in the near future."
 Fl New Haven Railroad affairs have A reached a stage where it is felt thai the road has turned the corner toward E rehabilitation and there is no longer any fear of a receivershfp reorganiza FT tion. On the contrary, the increased freight rates announced for New |N England carriers are calculated tc |p provide near $10,00O,0O0 additiona IF revenue for the New Haven, or suffi cient to suggest dividend declara ton since the government has extend ed necessary financial aid. It look
 
 turned to the possibilities offered b, the prospect of "come back' by thi great transportation system. Tn ! stock is refecting what has been term ed good buying during the past fev days. It is interesting to observe tha Secretary McAdoo's official statemen explanatory to loans to the railroad contains this suggestive clause: ''Witl the Libery- Loan successfully place it is hoped that a readier market fo other securities will develop shortl which will enable the railroads t provide more satisfactorily for thei present and future needs without re lying on government aid"
 Active investment interest has bee
 stimulated in the Steal group by tn
 unexpectedly good quarterly repol
 by the U- S. Steel Corporation, an
 the decision of it's wise directorate t
 continue the regular dividend distr
 button with the extra rate paid qual
 ter1y last year. The ratio of fncreas
 in earnings shown monthly since th
 first of the year speaks well for th
 prospect This applies to the indt
 pendent steel stocks like RepubIi
 Bethlehem, Lackawanna, and hight
 prices are also being predicted fC
 them Tha earnings of this grou
 show individual returns suggestin
 annual rates of from $25 to $50
 share in 1918.
 Speculative investment interest
 the coppers continues to be expectar
 and these stocks are expected to shal
 in improving tendencies of the met
 group in general. Inspiration ar
 Lnaconda Copper stocks remain u
 favorites fn this class. The pamphl
 report of the company for 1917 shoy
 $1A72 a share for Anaconda, Pc
 interests are reported to bew orki1
 for higher prices in AIlis-Chalme
 and Corn Products, two specialti
 that are attracting considerable a
 tention because of their large earnil
 power.