The Washington herald., 1920-07-27
STOCKSSUFFER
DECLINE
Market Strong Until Noon
When Downward Trend
Dominates.
MONEY REACHES Top.
Weakness in Direct Propor-
ton to Recent Activity
And Strength.

New York, July 2s.-The bad
local bank statement of Saturday
taken in connection with very slight
Improvement In the banking situa-
uon of the country as a whole re-
suited in a call money rate OF 10
per cent in Wall Street today and
In . market smashup. The open
Ing was strong because professional
wall Street believed that the war
IN Europe was over again. Trading
was on a very slight scale because
so many were going to the yacht
races Prices remained without
material change until early after
noon when they suddenly crumbled
away. Selling increased as prices
dropped with the result that the
market closed weak and active at
bottom prices with losses Of from
one point to as much as ten in ac-
tive issues. There was no par
ticular drive on the market, but
those stocks that had been most
active were sold most freely. The
weakness was in direct proportion
70 recent activity and strength.
Mexican Petroleum, Reading. Cruel
bic, Vanadium, Barrett and Texas
Pacific lost most severely.
The same banking interests that
warned the Street some time ago
to be on the lookout for 40 per
cent money put out additional
warnings today to confidential
friends. Two reasons were given
today for caution. The first one
was the bad bank statement which
showed a deficit In reserves with
very little hope of improvement.
and this at a time when reserves
should be strongest on account Of
the crop demand which Is certain
to come from the Middle West
The second reason was the heavy
falling of in our trade balance in
June. This balance showed only
about s7s.Ooo,O00 in favor of the
United States against $500, 100000
for May. II is the opinion of some
very highest financial authorities
that the balance will be against
the United States within three or
four months.
OH Stocks.
Oil stocks were sold freely in
spite Of the fact that several new
wells OF Importance were reported.
The Texas Company had one and the
InvincIols Oil Company another
The InvincibIe well was not publicly
reported during the market session,
but the stock held and attracted
much attention.
The most severe break came just
At the end of the day and the clos
ing gong rang in the midst of it,
leaving the market in a highly nerv-
Gus condition with practically ev-
=
stocks being at new low records for
the year. The buying was purely
speculative because the bankers
have succeeded in frightening all
investors with the prospect of
higher money. Even cash pur-
chssers are holding off.
One OF the most demoralizing
breaks OF the afternoon was that of
United States Steel, which hit a new
low record price for the year. Judge
Garys optimistic statement set
some people to buying Steel and
caused a good many others to can
eel selling orders which had been IN
the market The break, therefore,
caught everybody by surprise.
The pessimistic feeling in regard
to the motor stocks persists, and
when rubber broke through 90 there
was a good Selllng OF all motors.
Whether true or not, the Street be-
lieves that the automobile and tire
companies are all carrying abnor-
mally large Inventories of finished
material that should have been sold
10 the public at more reasonable
prices. The public has an opinion
that the automobile companies are
trying TO put something over" on
it They probably are not, but the
circumstantial evidence is against
them.