New-York tribune., 1920-09-21
Stocks Rise, Then
React i'm Busiest
e Day i'm e Weeks
Widespread Profit. Taking
Near Close Halts Upward
Movement; Time Money
Shows Larger Volume

Instead of revealing single
dominant trend yesterday, the Stock
Exchange appeared more in the light
of an ordinary market place. with di-
verse movements caused by the endless
higgling of buyers and sellers. After
opening with a slightly irregular
tone, security prices, particularly the
rails, climbed merrily upward, but in
the last forty-fve minutes Of trading
thare was a sharp reaction.
The nct result Of the days activi
ties was uneven. The gains of many
securities were effaced by the late re-
vision of prices downward, and some
showed actual losses for the day,
whereas others were able to hold
enough Of their squirt to reveal net in
creases for the session. Generally
speaking, however, the lowest levels of
the day were attained toward the
close.
The reaction caused no profound
surprise, as in the nature of things
rises in the market over a period are
accompanied by reactions, and yet the
action of some stocks gave the impress
sion that their recovery last week had
been due more to short covering tlan
to buying for long account. Unques-
tonably, developments last week
around the trading posts induced many
who were short Of stock to cover their
commitments and take their profits.
This process tended by the close Of
technical position of the market. which
is always helped by the knowledge that
short commitments remain to be
covered. This technical alteration, to-
gether with the rapid Use early yes
terday, may have invited the putting
out Of some new short lines by pro-
fessional traders who felt that the
advance was too rapid. A more potent
depressing cause, it would seem, how
ever, was the taking of profits by
operators for the rise.
Swayed by various contradictory
waves of buying and selling yester-
reference to the news. Traders in
quest of higher prices laid much en-,
phasis on the favorable bank state
ments of last Saturday, and although
the hanks emerged from the middle
of. the month payments unmpaired in
strength it should be remembered that
the Improvement shown is largely
superficial and that the true condl-
tions will be better revealed in next
saturdays reports, after the funds in
transit have settled down to the nor
mai banking channels.
Brokers who actually appear at the
money desk on the floor of the ex-
change each day are taking more
1oerful view of the credit outlook
They found time money offered at 8
f'"r cent in a shade larger volume yes
'"rdav. Loans to ~n six months
ere offered By lenders, but borrowers
i inc to the view that there will be
uh: tantial easing in the credit mar
k"t at the first OF next year and are
per cent running for longer than
'Incty days. There was some sugges-
.:oA that the rate might break to 7a4
Ncr cent, but as far as could be as
,ortaincd no loans were made at this
rate. Call loans we're arranged at 7
1cr cent.
in the stock market there was no
ign of an abatement of speculative
npetite for oil securities, and, stimu-
'"ted by further theoretical discus
sions of the possibility of railroad mer-
% s. the low price rails continued to
nc picked up. In breadth of activity
;hc market exceeded any day since
'ugust 9, and was the busiest day
''0cc the recovery fror: the low levels
midsummer began.