New-York tribune., 1920-05-26
Rally i'm Market
AS Shorts Cover:
Steel a Leader
Stocks React to Oversold
Condition With Vigorous
Upturn; Sentiment More
Cheerful; Money at 6

Wall Street sentiment, which has s
way of following the tape in its record
of the ups and downs of stock prices
took on more cheerful tone yester.
day. Stocks enjoyed quite a healthy
recovery in movement. which had as
its main impulse active repurchases
by bear traders, who for some time
past have been devoting their energies
to selling for the decline.
Without any important change in
the news yesterday, this element
started in to cover and, as often occurs
when the market has been oversold
found itself in the rather awkward
position of having to bid stocks up to
buy them in. AS it became apparent
that the shorts who began to cover
early in the session were finding the
supply of stocks more or less limited,
the buying from this quarter became
increasingly active until in the after
noon the whole list moved forward
vigorously. On the upturn industrial
'Shares were up all the way from ? to
. points from the early lows, and in
some cases 10 points or more above the
lows made on Monday.
The rally could hardly be called un-
expected despite the unusual degree
servers have been looking for a turn
IN the price trend for several days if
only because of the fact that the mar
ket appeared to have been thoroughly
llquldated and to be in an oversold con-
d1tlon by reason of the persistent pro-
fesslonal selling. On Monday it was no.
tlceable that the efforts of the bear
contingent were not SO successful in
producing liquidation, a fact which
OrOhQ Ill
repurchases for the short account in
the early dealings yesterday.
Signs point to general Improvement in
the transportation blockade and the re-
lease of credits frozen by the inability
OF manufacturers to market their prod
ucts. The opinion was expressed in
banking circles yesterday that the
worst of the credit strain due to the
freight tie-up had been experienced and
that from now on conditions should re-
fleet gradual improvement. In the
commercial money market yesterday
there was evidence of somewhat better
feeling where the stringency seemed
to be relaxing. In the call money mar
ket rates held per cent all day long,
with renewals at that figure, despite
the fact tht the banks were called
upon to meet Withdrawals by the
United States Treasury amounting to
approximately S16,O00000
In the stock market the vigorous
strength Of Steel common, which
crossed 93, compared with low of
899s on Monday, stood out prominently.
buying Of Steel reached large proper
tons as the session wore on and as
the price forged ahead. With the
shorts running to cover in the market
Leader 1t was not surprising to see
similar movement taking place in other
parts of the list. Oil shares were
among the early features of strength,
especially the Pan-American Petro-
leum issues and Mexican Petroleum,
which responded to more favorable
news from Mexico. Sinclair Oil, which
has been under special pressure for more
than week, showed a substantial re-
coyery also. In the equipment group
Baldwin Locomotive led the rally, while
Studebaker held first place among the
motor shares. Copper stocks were also
strong: The Improvement in rails
seemed to be based on the improved
monthly earning statements now com
ing to hand and to the belief that out
OF the hearings under way in Washing
ton the roads will be granted relief
from high operating costs in the shape
of liberal advance in rates.
Continued strength of exchange on
Germany and Austria supplied the most
interesting development in the foreign
eXchanJe market. German marks
have t7aen strong for a week largely
on th/ prospects of an early clearing
up q the uncertainty over what Ger
marry will have to pay in the way of
an Indemnity. Exchange on London
aVd Paris held firm