New-York tribune., 1920-05-21
Better Tone i'm
Stock Market as
Pressure Lifts
Further Liquidation at Open
ing Drives Many Issues to
New Lows; Stocks Show
Rallying Power Later

Wall Street appeared yesterday to
be recovering from its bad attack of
nerves of the day before. Traders in
speculative securities took a more rea-
sonable view of things. A report that
$40,000,000 in gold is about to be
shipped to New York from London on
British government account helped to
dispel the gloom in the market place.
There was again heavy selling of
stocks, but it lacked the impetuosity
of the preceding day, when securities
were dumped overheard regardless of
values and everything else. At the
opening offerings were in unusually
large volume as the result of belated
liquidation by spectators and inves-
district who did not have time to un-
load the preceding session.
Much of the early selling represented
also offerings for spectators who had
been called for additional margin by
their brokers and had failed to respond.
This selling was sufficient to depress
prices considerably further in many
issues. New lows were registered by
most of the representative industrials.
the end of the first hour, however, of
ferings slackened perceptibly and sup
porting orders began to appear. The
buying came from the largely expand
ed short interest and from interests
who considered that many stocks had
reached levels on the decline. where
they were selling under real values.
The market on the whole, despite the
better feeling. continued in a highly
fevcrish condition. Most observers of
market conditions profess their inabil-
ity to predict with any degree of con-
fidence what will happen next to spec
ulative securities. To many experts,
however, it looks as if stocks had dis
counted by the fall in prices in recent
weeks, eliminating in the drastic break
on Wednesday, a considerable reaction
in business. Whether, of course, the
market has fully discounted the future
trend of trade remains to be seen.
Unless, however, the stock market
hysteria, it would seem that in the
natural course of events a fair re-
coyery should be expected. 1t was for
such a rally that the professional trad
ing element was playing yesterday
after the early selling movement had
run its course. Active covering of
shorts took place in the closing hour,
when the report Of impending gold i'm
ports reached the exchange. Prices
of many of the issues which were weak
est on Wednesday rebounded sharply
shortly after the opening. jumped to
90 and closed there. Mexican oil
shares, motor issues, sugars and rails
all rallied we'll from the. early lows, in
some cases registering net gains at the
close.
Evidence of the improved mental
condition Of investors reflected in the
market for United STATES government
war bonds, where after early weakness
slight recovery occurred. The out
standing feature OF the market in the
Liberty loan and Victory noe issues
is the appearance Of an increasing
volume OF buying orders. indicating
that people are beginning to realize
the attractiveness of these securities
for investment. This is the kind of
buying which in the long run will go
far toward restoring confidence
Call money was in plentiful supply
at per. cent, with renewals at per
cent. There were some small with
drawals on government account, but
they were not a factor. 1t is in the
commercial paper market where the
effect of the credit strain is most ap-
parent at the moment. Commercial
firms in need of funds are now paying
Y per cent, against 5 to 51a per cent
early this year. One large commercial
establishment of good credit standing
is reported to have paid close to per
cent this week for S5,000,0Q0.
The foreign exchanges were firmer.
Credence is given to the rumors of
impending gold imports for British
account