The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-10-19
FINANCIAL NEWS
AND COMMENT
Reaction in Stock Market Is
Due to Continuation of
Profit Taking.
LEADERS HOLD UP WE'LL
Setback Is More Pronounced
in Observation-Disclosures Lends :
Down to 6 Per Cent.
LEADERS HOLD UP WE'LL

In so far as outward appearances were
concerned the stock market yesterday
was still under the influence of the Brit
fsh strike news, but in reality the reac-
ton which occurred in prices was moth
ing more than continuation of the
profit taking movement which started
last week. The trading fraternity gen.
orally credited the strike as the principal
reason for the decline, but If there had
been as much alarm as some interests
seemed to think there was the strike
news would have affected first the Lon
don stock market. That market how
ever, remained quiet and steady through
out the day and there was nothing more
than an ordinary setback in the ex-
changes. 1t was as good a pretext for
selling stocks as any. however, and 1t
served the purposes just as well as
would q piece of real unfavorable news.
Still, surprisingly little progress was
made under the circumstances. The spe
oial stocks went down just as they have
all along, but in so far as the leading is
sues were concerned the market acted
fairly we'll
That prices did not go down any fur
Their again showed that stocks are still in
comparatively strong underlying posi-
ton. In other words. that there is still
large demand on the part of the short
interest. 1t was disappointing. however,
to find so little response to the lowering
% the money rate, which was fixed at
per cent, as contrasted with per cent.
or Friday. But the market having re-
fused to heed the rising rates last week
apparently decided to pay as little at
tention this week to the lowering OF
rates. all of which went 20 prove the as
sertion, made in speculative quarters
last month, that it was the business sit
uation and not the money situation
which Is back of the decline in prices
The bank statement too might have
proved an optimistic consideration IL
Wall Street had been in the right frame
of mind, but. like the money situation
and other considerations which ordi-
narily might be expected to exert a
fay orable influence on prices, this too
was ignored.
The setback was more pronounced, OF
course. In the industrial stocks than In
the rails, but the latter felt the pressure
also in the last half of the day. Stocks
like Baldwin, which had made fairly
rapid progress in the rise last week,
naturally went down faster than other
groups, but, as before, it was noticeable
that activity tended to slow down as
prices neared their previous points or
resistance. The real outstanding weak
ness of the session was in the special
stOC{H OF the. type VI toSSsi S-Aec~1NNhN'
That stock made a new low record close
to los, but rebounded later in the day,
when IL was announced that the stock
was loaning on a premium. The copper
shares also continued to display weak
ness. and there was fresh selling in
some of the motor shares. This. how
ever. was mostly for the short account,
and il was the opinion of market OBJ
servers that the days market operations
in such instances had resulted in
stronger technical position.
The money market acted just as had
been expected Money renewed at per
cent. which was a 2 per cent. decline
from last Friday. and later in the day
loaned down to per cent. That tne
money situation has finally turned the
corner and from now on will continue 10
improve is admitted in all banking quar-
ters. II is still possible that there may
be occasional flurries on the first OF the
month or when there are unusually
heavy Withdrawals from the local banks
nv the Government but these fiurries
will he only temporary affairs AT best
thew are not expected to have any in
duence on the stock market, which Is
now looking entirely at the business SIDE
of the reimbursement. 1t q now realized
that the further business declines. the
more money will be available for stock
market speculative purposes. The break
IN sterling to around s3.43 was not con-
sidered in foreign exchange circles as
having any particular bearing on the
strike