New-York tribune., 1920-11-23
Stronger Tone
Causes Stocks
To Rise A gain
Long Delayed Reaction Is
Helped by Purchase of
General Motors Common:
Money at AZ Per Cent

After the tumultuous decline of Sc
curity market values since election, it
is not difficult to explain a recovery.
The perpleXing factor is not that the
rebound at last has come, but that an
upward reaction was so long delayed.
AS trading began yesterday, security
prices were unQuestionably at so low
an ebb that only the slightest provoca-
ton would have been enough to have
caused turn. The climbing up from
the lowest level of the year, attained
last Friday, already had begun on Satur-
day.
The dynamics Of recovery became
accelerated by several sub-surfacc de-
velopments over the weekend. which
removed from the market overhanging
securities which had been chilling the
enthusiasm Of operators for the rise
The most important of these changes
was the purchase of huge block, esti-
mated at at least 100000 shares, of
General Motors common from William
c. Durant, president, by the Du Pont
interests, who, with J. P. Morgan &
Co., are now said to be in control of
more than 81 per cent of the stock of
the company. This transaction, with
he speculative setting, such az it was,
marked turn in sentiment, and sensi-
i've spectators, who had sold securi-
tes short at much higher levels, began
TO seek to buy back stock, with which
10 cover their commitments, a process
which was by no means easy and which
caused sharp rally of quotations,
which were at the peak for the day
when the final sale was made Since
Saturday, according to The Tribune
averages, the average of thirty repre-
sentative industrial stocks rose from
1277 to 1927; that of twenty rails
climbed from 66.65 to 6865, and that
of the fifty securities from 1882 to
1922. The volume of business was
large, and the eagerness Of the buyers
persisted.
Aside from the stimulus obtained
from the passing of stock to stronger
hands, there were other constructive
factors, particularly in the domestic
and international money markets.
Sterling exchange scared to S3.524
cents to the pound, up five cents for
the day, and the Continental currencies
similarly recovered. Moreover, the
easing of money locally, which was
evidenced by a decline last week of
call money, was reflected by signifi-
can't shrinkage Of S124,O 100000 of dis
counted and purchased paper in the
possession of the twelve Federal Re-
cerve banks.
This contraction from the summit
reached fortnight before was re-
gs srded as foreshadowing a fundamental
easing in the market for funds. Yes
terday call money at renewal time was
lent at the money desk on the floor
of the Stock Exchange for 7 per cent.
then the rate dropped to 6, and at
the close to per cent. After the
close, $1,000,000 was lent on call at
AZ per cent. The per cent quota
ton was the lowest official rate since
December 18, 1919, and the 5 per
cent the cheapest since October "a.
1919.
In the cotton market, despite great
lrreegularity, strong tone persisted,
and quotations at the close revealed
net gains Of from to 81 points. In
the wheat and corn marts. however
rising quotations early in the session
We're regarded as an invitation for
further liquidation, and heavy offerincs
carried quotations down to new low
levels for the year. Wheat prices
slumped from OK TO IS points from
the morning prices.