The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-11-05
FINANCIAL NEWS
AND COMMENT
Stock Market Trading Is Con-
fusing Mixture of Strength
and Weakness.
INDUSTRIALS ARE HEAVY
Rails Do Best as Money Tight
ems and Jumps to 10 Per
Cent in Last Hour.
INDUSTRIALS ARE HEAVY

Trading In yesterdays stock market
was very confusing again. with great
strength characterizing some parts of
the list and with equal weakness In
others. The great rush to buy high
grade dividend paying railroad stocks,
which began when the Southern Pacific
episode reminded Wall Street that there
are a great many other railroad COM
panies in a position to do the same
thing that Southern Pacific and Read
ing propose to do was continued. but
where there was one strong spot In the
railroad department there were at least
ten weak ones In the Industrial group.
The result was a very conflicting price
movement throughout the session. Thus,
while Southern Pacific. Great Northern
and Northern Pacific were enjoying an
other sharp advance, stocks of the type
of Steel common. the independent steels.
rubbers. &C.. which have not completed
their readjustment to the satisfaction OF
the financial community, went lower
The single exception to this rule in the
industrial group were the equipments,
but after the short interest had been
run in here too they turned downward
along with the rest of the list
1t was not necessary for Wall Street
to invent any new theory of why prices
acted as they did; II was mainly ques-
ton of prices rejecting business con-
ditions of the market discounting de-
creased earnings lower dividends, &C..
which are bound to follow the price cut
ting and falling off that has been ex-
perienced in general business. Where
stocks have pretty thoroughly discount
ed the process of adjustment II was no.
ticeable that the market held up very
we'll but where Wall Street is still in
doubt as to whether prices have fully
measured the extent of the business re-
action. the market had a distinctly weak
undertone. Besides, the money situa
ton still worked against rising prices.
That situation in itself indicated that
the liquidation had not been completed,
orss for that matter. that the business
readjustment had not fully run its
course. as it will eventually be found
that the cutting down OF loans, &C., will
be the one factor which will bring real
case in the money situation. 1t was sig-
nificant again that the principal weak
ness centred in the steel shares. which
is the one group Of stocks which Wall
Street believes have much to face in the
matter OF price readjustments
The railroad stocks all made their
best prices in the last hour of trading
fl ON going down. Indeed IL was while
the railroad stocks were strongest that
the industrials displayed their weaSes
undertone. This was nothing more than
repetition of conditions OF a month or
more ago, for it will be recalled that
the railroad averages reached new
highs while the industrials were at their
lowest That the lower priced railroad
stocks refused to move with the rest of
The rails indicated that the railroad
movement was by no means general
that It included only such stocks as
are likely to benefit from the various
scgregations and other deals that are
under way in the railroad group. The
strength OF New York Central, for in
stance was- direct reflection OF it,
ownership Of stock in the Reading Com
pany. while Northern Pacific reflected
rumber of deals which are supposed to
az under way regarding that property
srd which arc supposed to reflect also
larger dividends. melons. &C.. for stock
holderc.
The money market surprised Wall
Street by hrming stu further. Whereas
the rate on Wednesday had remained az
9 per cent. all day. the demand for funds
Yesterday was sufficient to cause
t ghtening of the strings to 10 per cent.
n the last hour. This was contrary to
what had been expected, as predictions
had been freely circulated at the close
u business on the preceding day that
money would drop in the last hour OF
E, eSterday's session