The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-10-22
FINANCIAL NEWS
AND COMMENT
Decline in Stocks Confined to
Special Issues-Leaders
Drop Fractionally.
STEEL GOES BELOW SO
Money Is Trifle Firmer, While
Leading Rates Are Not
Changed.
STEEL GOES BELOW SO

The stock market had to undergo an
other important test of it's underlying
position yesterday with the announce
ment Of the British railway mems
threat TO join the striking miners and
/ once more acquitted itself in a fairly
satisfactory manner. The market did
not, however. steady itself until stocks
lad cancelled virtually all of Wednes-
days gains and the average had been
brought down into what Wall Street
considers the critical zone. The evil
dence presented that the market ha 4
successfully resisted again the points
which have been threatened several times
| ir. the last fortnight was not conclusive
enough for observers to predict that the
danger of going through these levels had
passed. as there was practically no rally
from the lows. But IL was significant
nevertheless, that stocks should stop
where they have stopped no less than
four times previously. That the prog
less on the down side was confined to
special stocks and that leading stocks
showed only fractional declines was an
other favorable consideration.
The Street still was not disposed to
take the British strike seriously in so
far as 1t affected American securities.
but II was generally admitted in trading
circles that to-day's market would prove
very important test as to the future.
If the market should happen to break
/ through all points of resistant II waa
pointed out, the indications would BE-
that the Street is likely to experience
another prolonged period of liquidation
whereas, if. on the other hand the
market rallies from yesterdays lows.
then the view is that Wall Street is
likely to gets its election rally after all.
The market was very uncertain through
out. however. and even those who have
been most optimistic were forced to az Z.
NIT that the market thus far had not
been satisfactory second bottom TO the
last downward movement. on the other
hand, the fact that there is still very
large short interest In stocks, coupled
with the additional fact that thus far
they have shown very good resistance
on declines were considered points in
the markets favor
That the selling was virtually all for
the short account, in so far as yester-
days decline was concerned. was OBJ
viouS for the reason that the market has
not yet got down TO point where real
liquidation can be expected. This did
not prevent such stocks as Mexican Pc
troleum and Pan American from show
ing sharp losses, however. but not all Of
this was due to the British strike news.
In the case of these stocks the selling
reflected the dissolution of n pool which
has been operating in the Mexican
stocks for several months. Steel COM
mon got down below So and Corn Prod
ucts was subjected to another bear drive,
which drove 1t down TO around so, but
for the most part the real progress was
recorded in special stocks or In stocks
in which some other consideration be-
sides the British strike was at work.
There was nothing of importance in the
rails with one or two exceptions. st.
Louis and Southwestern was one OF
these exceptions. making good progress
on the report that it's directors were
considering the resumption of dividends
on the preferred stocks
There was no change in money rates
during the day, but the situation was
somewhat frmer than heretofore as was
indicated by the fact that some money
loaned as high as s per cent after the
close. This f1rmness was wholly tempo
rary, however. and due entirely to the
fact that the Government has withdrawn
considerable funds from the local banks
this week. The aggregate Withdrawals.
IT is understood. total more than $780,
oO0.0 900 Sterling exchange did not get
down to its previous low of the week.
but the loss of virtually all of its rally
was not encouraging. II Is pointed out.
however, in foreign exchange circles that
the weakness of exchange Is natural 30
long as the British situation continues
SO critical. There was another sharp
smash in the cotton market with all
options at new low records for the year.
and there was an almost equally violent
decline in the grain markets. all of which
of course naturally tended to upset the
market in securities.