Evening star., 1921-06-14
MARKET FIRM;
!! RALLY CONTINUED
Oils and Motors Are the Fea-
tures Of the Days
Quiet Trading.
BY STUART p. WEST.

O01Cl 0OtllSs
T BY STUART p. WEST.
NEW YORK, June 14-YesterdAy's
indications that the stock market had
reached a turn were borne out by to-
days price movement This did not
refer indiscriminatefy to the general
list. There were . number Of points
Of special weakness, which were . re-
minder that a good deal of unfavor-
able news in the shape or dividend
cutting and poor earnings reports still
lies ahead
But the greater part Of the indus
trial list and q fair percentage of the
railroads continued to rally through
the early part of the day in a manner
TO suggest that the speculative cam
paign for lower prices had been suS-
pended because the experienced oper-
ators back of it realized that they
were meeting with formidable oppo-
sition.
Rails Check Recovery.
For a time the recovery was held In
check by another outburSt OF selling
in Northern Pacific and Great North
ern preferred. which represented Wall
streets forecast that the rate of dis
tribuuon on both these stocks will be
reduced 1t was significant that they
ISdCneu prices WHICH put tuCHi
on a level with other old-line rails
paying per cent
The weakness in the Hill shares
caused some selling of other rails
during the first hour. Then the buy
ing movement was actively renewed
in the industrial stocks. which had
led the way in yesterdays rebound
@Stude baker. American Wool. Mexf-
ican Petroleum Central Leather. the
tobaccos and some of the American
oils SteelS and sugars went along
with the rest. but more perfunctorily.
because their trade situations still ap-
pear some distance of from the turn
ing point.
Money Rate Drops.
The main incident in the news of
the day was a further reduction in the
call money rate. this time to 5h per
cent Such action has been fore
shadowed, to be sure, by the free Of
ferings of this class of funds in the
outside market as low as per cent
Still, coming the day before the heavy
tax payment and distribution of liberty
bond interest. it was a rather remark
able development
A fortnight ago there were many
who We're predicting considerable Of
strain over this period. The ex-
PLANTATION for the easing of the money
market is threefold-first, that interior
banks have ceased to draw down their
ing at the outset of the month; Sec
ond. that funds involved in some Of the
recent syndicate offerings have now
found their way back to active use,
and. third, that the credit supply has
been increased by the liquidation and
heavy decline on the stock exchange.
Studebaker Leading Factor.
Studebaker plainly was the leader
from which the entire market took
its cue. The big reaccumulation in
the stock occurred just under 10. Bear
traders found, when they offered the
stock down below this figure. that it
was very readily taken. There is
no doubt that the buying came from
the same interests which were re-
sponsible for the move across 80 in
May. and when the market turned
yesterday afternoon Studebaker was
the pacemaker ana looked as it did
two months ago, when it was being
pushed ahead at every opportunity.
The same characteristic of vigorous
forcing tactics was apparent again
today.
II has been pointed out several
times before that despite the check
which came over the motor industry
a month ago. Studebaker earnings
have held up well and will run about
So for the half year. This is at the
rate of SIS for the full year. and
means that the entire twelve-month
dividend will be considerably more
than covered from the operations of
the first six months Having highly
quarter to look forward to, those back
of the market for the stock feel that
they have abundant ammunition with
which to work
Heavy Selling in Rails.
Action on the Northern Pacific divi-
dend is expected tomorrow. While it
has been given out semi officially that
o,s.f0 "a
what the rate will be. the street
has been skeptical about these as
surances right along. There was very
heavy selling in both Northern Pa
cific and Great Northern preferred
again this morning. and the fact that
both stocks at one time sold two
points under Chicago and Northwest
ern, the dividend on which was cut q
year ago from to per cent, and
points under New York Central. pay
ing D per cent Indicated what the
market had in mind.
Northern Pacific has not sold where
it did today since 1900-the year be-
fore the historic corner-when the
stock was paying 4 per cent Great
Northern preferred has not sold at
80 in twenty-five years, when II was
on q per cent basis
Passing OF Loew Dividend.
Passing of the Loew dividend
Scarcely came as a surprise in view
of the low selling price Of the stock
1t was given out that the manage
ment had been unable to obtain mort
gage money on some of its new build
ings and had to borrow $2.500,o00 at
the banks AS a result 1t was found
necessary to conserve cash resources
and suspend payment to the share
holders Loew stock is very widely
distributed in small lots, owing to
the sale of large quantity some time
ago to the patrons of the company's
theaterS.
Price cutting in railroad equipment
while not so widely advertised as the
price cutting in the steel industry. is
nevertheless going on and 1t is estf-
mated that quotations will be further
reduced before substantial buying Is
attracted. 1t was figured today that
locomotive prices. while not yet down
to pre-war levels, are much below
the peak reached last year when they
were 25 cents a pound. The main
thing which is keeping equipment
prices well above the pre-war level
is the high cost of labor.