Evening star., 1921-08-31
TRADERS CAUTIOUS
FOLLOWING MARKET
Testing Strength of Improve
ment-Some Industrials
Lower.
BY STUART p. WEST.

NEW 1O1h, august Slime
whole test in the stock market to-
day was whether the improved SEN
timent over the business outlook of
the country had yet become strong
enough to sustain the higher prices
reached as the result of the hurried
preceding days. 1t was generally
agreed that the inside position had
been considerably weakened because
of the removal In large part of the
support from covering purchases"
1t was simply a question whether
investors and speculative traders had
regained their confidence sufficiently
to follow up the rising price level
and push onward still; further
AS it turned out, prices held better
all through the early part of the ses-
sion than had been expected. This
was chiefly because realizing sales in
the Industrial stocks. which had had
the big jump yesterday, were Offset
by the bidding up of the rails.
This latter is a familiar enough
maneuver at time when the profess
sionals are looking for a means Of
hiding their selling operations in the
industrial division.
1t was a somewhat bold procedure
this morning, coming as 1t did In the
face of reports that the strike vote
being taken up among railway en-
ployes was showing a large majority
in favor of rejecting the IL per cent
wage reduction. 1t is. of course,
doubtful whether. even should the
final vote be overwhelmingly against
acceptance, the union leaders would
be willing to enter a struggle. not
only against the railway executives.
but against the government as repre-
scented by the labor board.
Would BE. u Fizzle.
At all events, such a strike, at q
time of universal unemployment and
opposed, as 1t probably would be, by
the great mass of public sentiment.
would almost certainly be fizzle.
Outside of the Wall street trading.
interest centered upon the abrupt and
very sharp check to the upward
movement in cotton and upon the
weekly summaries of the iron trade
journals. AT one time some of the
cotton options were off full cent in
the pound, this not because of any
particular change in the weather
termination on the part of those hav
ing profits from the advance of the
last ten days to gather them in before
the government report comes out.
Evidently the thought was in every
body's mind that the extraordinary
forward plunge of the last week or
more might have overdiscounted the
amount of damage which the depart
ment's figures will show. Also more
consideration was given to the pos
sible effect OF an overrapid rise. In
checking trade demands both here
and abroad.
An Important Fact.
One of the most important state-
ments made by the Iron Age in a re-
Tennessee Coal and Iron Company
had increased Its capacity to nearly
so per cent. partly as the result of
export business. but also because Of
the Improvement in the south
This was one Of the first actual
Of the recovery in the cotton trade
upon industry in the southern states.
The Steel Corporation, 1t appears, is
operating at not quite 80 per cent.
AS for the steel business in general,
the reports are CONFLICTING: but with
a majority on the side of improve
ment.
The most hopeful feature is the ap-
preaching exhaustion OF surplus sup
plies. When these are all used up.
mill capacity will certainly Increase.
Southern Railway Firm.
The unusual activity at advancing
prices in Southern Railway issues was
taken to mean that the preferred
dividend, which has been twice de-
ferred, will now be acted upon favor
ably. The ordinary time for paying
these dividends IL semi-annually, in
April and October.
The traffic outlook for the SOUTH
ern roads has, of course, been inn
proved by the recovery in cotton
prices, and 1t may be that this Is a
determining factor In the minds of
the Southern railway directorate. On
the other hand, Southern railways
gross has been bad right along. In
July 1t ran S2.2o0.Oo0 behind last year
still larger in August. But these un-
favorable gross results have been
partly counter balanced by the saw
Ing in expense accounts. Net oper.
atinK income in July was $1,1e3.000
against $1.0ss,o00 in the same month
a wear ago,