New-York tribune., 1919-12-13
Stock Market
Weakens as Call
Loan Rate Jumps
Railroad Stock Average
Touches Lowest Point of
Year When ID e M a N d
Money Mounts to Is p. C..

Calling of demand loans on large
burst of liquidation that carried nearly
the whole stock exchange list to lower
levels. The movement was accelerated
by further weakness of the foreign
exchanges and by continuation Of
dribbling sales for foreign account
although this was more in evidence in
the railroad bond list than elsewhere
The decline brought the average price
of railroad stocks. which were ad-
versely affected by the continued un-
certainly as to whether the roads will
be returned to their owners before
protective legislation can be passed
down to the lowest point of the year
Railroad stocks are, on the average
year ago, while in the same period
the industrial average has scored 6
net advance of II or 18 points, after
declining as much from the high point
of November.
Although there we're feeble rallies
|. from time to time, the market was
weak almost throughout the session
Buying power seemed hard to develop
and the bulk of such support as was
in evidence was for short account
Railroad stocks suffered most. II
could not be said that pressure or
these stocks was exceptionally great
offered little resistance to the COM
paratively light selling orders. Trans
actions in the rails were in small
units, as rule. In fact, the same
thing applied to practically the whole
list, the number of large blocks chang
ing hands being exceptionally small
for a market exceeding 100000
shares in volume.
The market while displaying a sag
ging tendency after the opening, did
not become especially weak until money
opened and renewed at per cent, the
highest renewal rate since November
21. But when brokers reported money
hard to obtain even at that rate an
other jump was freely predicted, and in
consequence the word went out to sell
stocks. Even some brokerage houses
that have been counselling their Gus
toners to "buy on the breaks" sent out
word to "sell on the rallies" instead.
Traders, who have as class become
exceedingly pessimistic within the last
few days, were not slow to accept such
advice. When the call rate jumped
first to IL and then to Is per cent in
the middle Of the afternoon the mar
ket became so weak for a short time
that some observers began to look for
a really serious slump. But the low
prices attracted some buying for long
account, and this, added to rather sub
stantial short covering, which was
stimulated when money again got down
to per cent, was sufficient to check
the decline and to put most stocks up
somewhat from the close of the day.
The tightness of money was attrib-
uted to preparations for the heavy de-
mands that will be imposed on the
banks Monday in connection with the
Liberty Loan interest payment and the
payment of the final instalment on the
income tax. Wall Street was more con-
cerned, however. over the increase in
discount rates, which had as one of its
objects further limitation of loans fol
speculative purposes. Speculation feeds
on money, and if money is not forth
coming market activity is bound to bt
restricted.
The steady decline in the foreign ex
changes was another factor making fol
gloom, especially when considered il
connection with the credit situation
Brokers and traders fear that the bar
on expansion of loans for speculative
purposes will not be lifted until the
foreign demand for credits here is par
TALLY satisfied.
Sugar stocks we're unfavorably af
fected by the action of the Senate IL
passing the bill continuing the Suga
| Equalization Board.