The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-08-22
FINANCIAL NEWS
AND COMMENT
Stocks Rally With Surprising
Ease After Early Drop Due
to Reckless Selling.
BEARS LOSE CONFIDENCE
Advance Expected by Many,
Considering Markets Tech
meal Position.

Another sharp decline in the morning
hours yesterday marked apparently the
end of the declining movement on the
Stock Exchange, for the time being at
least. At any rate, the character of the
, trading thereafter underwent a change
and for the first time in more than a
week firm recovery set in, which was
emphasized by aggressive general ad-
vances in the last hour or SO.
The market had to contend with q
considerable amount OF reckless selling
pressure again at the outset, particu-
larly in the steel shares But once It
was appreciated that the steel strike sit
uation had turned out about as expected
1t began to be perceived that entirely
too much stress was being laid on such
possibilities with too little attention
being paid to the improvement which
| has occurred in the technical position.
The most significant thing about the
recovery was that absolutely no change
| in the news developments accounted for
It. The foreign exchange market was
| steadier, in that the rates recovered
| sharply from Wednesdays lows, and
there was less alarm exhibited over the
possibilities involved in the steel strike
situation. But these were rather aside
| from the main considerations.
1t was a case Of the market having
been carried too far on the bear side to
permit any further operations by pro-
| fessionals, at least for the time being. In
| other words what happened was what
everybody had been looking forward to
all this week The declining movement
| had been largely overdone and 1t was
| only a question of time when the Street
should realize that everything had been
lsal,a ,k.l. 81 haw haI
hoping for some time ago, namely, the
curtailment Of the wild speculation and
| the reduction of the brokers' loan ac-
count within u reasonable figure.
These things having been accom-
| lished in large part the Wall Street
community took its mind of the foreign
| exchange situation, the labor difficulties
and other factors with which 1t had been
engaged lately, and proceeded to bid up
stocks in a fashion which had not been
witnessed in the last fortnight.
While the market generally showed
net gains at the end of the day. 1t
was not until another new set of low
| records had been recorded that the buy
| ing actually started Steel got down
to it's previous low recorded, although
| good scale buying took place all the
! way down, and there were wide breaks
/ again in such stocks as Keystone Tire,
the tobaccos and other specialties Of
the type which have been the principal
| targets of the bearish speculation OF
| late.
Then with q suddenness which was
suggestive of a change in the character
of the trading the whole list rebounded
. most issues closing the day around the
high figures. Steel common. which re-
sisted the downward movement better
than any other issue, recovered al
but a fraction of what 1t lost on Tues
day, and some of the other standard
shares and specialties did even better
The Improvement probably did not &C
| as far as most persons had expected In
| view of the series of declining markets
but it showed a change in speculative
sentiment, and. what Is more, that the
bears are not SO surpremely confident as
| they were some time ago.
| The rally undoubtedly received some
impetus from the better tone which
prevailed at the foreign exchange market
| Demand sterling recovered almost seven
| cents from its low of Wednesday, and
| succeeded in holding most of the gain
throughout the rest Of the session. The
| Improvement was not significant in that
| II reflected nothing more than short
covering, but It was Il change at ans
rate from conditions experienced re-
| Gently, and Wall street lost no time
in taking advantage of 1t. Other ex'
changes followed the leadership Of ster
ling. Pesetas improved. and SO did franc.
and lire.
No change occurred in the money
situation. Call money continued to loaT
slightly above the levels of recent SEES
sions for precisely the same reasons a!
were explained yesterday-on accoun
of the withdrawal of out of town fund.
because the rates here had reached &
point at which loaning out this clas
of money had become less profitable.