Evening star., 1921-07-06
TURN FOR BETTER
IN STOCK MARKET
Sharp Recovery From Recent
Heaviness-Foreign Oils
New Low.
BY STUART p. WEST.

sudden ana really violent uplurii oh 1he
stock exchange there was one predomi-
mating reason; namely, that the market
generally had ceased to be sensitive TO
points of weakness developed In indi-
vidual stocks and had become hardened
to unfavorable trade news. The INFER
ence first drawn a week ago-that
price level had been reached low enough
to discount the worst Of the Industrial
iepression-was supported by TO-DAY
occurrences more strongly than at any
time so far. 49,
Even a fortnight ago a smash like
that Of last Friday and yesterday IN tne
Mexican Oil shares would have upset the
entire list The fact that Mexican re-
troleum could break eight points IN
single session without causing any de-
cline to speak of in other stocks was
highly impressive from a practical trad
ing standpoint.
Some Striking Features.
It indicated beyond question that
decisive change for the better had come
over the market position without there
having been any change in the outside
news.
No less remarkable than the way
prices resisted the relapse in the
Mexican oils was the way the news
of the steel price cutting was re-
ceived. The first reductions two
months ago brought a downpour OF
liquidation into the steel stocks. The
second reductions-those of Bethle-
hem Steel on Friday last and Repub-
lie Iron and Steel today-not only
caused no selling. but were followed
by rise in the steel stocks quite up
to the average of that in other groups
Foreign Exchange Weak.
Fresh weakness came into the for
eign exchanges and sterling got down
within a cent of it's extreme low OF
the year, which was reached during
the period of decentralization more
than a month ago. induced by the
clumsy handling Of the first repara-
tions payment. Further light was
thrown upon the downward movement
by the announcement this morning
by the banking firm representing the
British government. that 1t was pre-
pared to redeem at once the United
Kingdom five-year 51a per cent notes,
due November l. AS these notes are
dollar credits has had to be set up
against them in this country, and
herein lies another explanation. along
with the German indemnity repara
ton. Of the recent heavy demand for
dollar exchange and corresponding
depression in the foreign currencies.
Market Rallies Easily.
The main technical feature about
the market was the great scarcity of
points OF last nights prices. once the
short covering wave Set in. 1t took
only few transactions to put such
recent bear favorites as Famous Play
ers. Sears-Roebuck. Harvester and
Baldwin Locomotive up from two to
four points.
Pan-American was selling at 39k a
few minutes after 10 o'clock. and at
As two hours later. The volume of
trading in Stuoebaker was much
larger than in most others. indicating
special buying in addition to heavy
purchases for short account.
But the rapidity with which the
stock responded to this buying was
remarkable. 1t took not more than
1900 shares to put Bethlehem Steel B
from As to AIN. and the scarcity of
the other Independent steel shares
was quite as pronounced.
1t was Mexican Petroleum which
turned the market today. 1t was plain
that Mexican Petroleum would have
to strike bottom, would have to cease
being a menace to the market, before
much Of a recovery could occur. AL
though the bear objective in Mexican
Petroleum all along had been 80.
further pressure at the opening this
morning that the drive was continued
to 87A. Then came the extraordinary
snap back.
The demonstration in Studebaker
stock. which carried 1t through its
previous trading limits. accompanied
the full-page advertisement in a New
York newspaper telling of the re-
markable increase in Studebaker cars
in Greater New York. For the month
Of June alone 369 more cars were sold
this year than last. the money taken
in being 326 per cent greater than
that of the same month last year.
Due to a lowering Of maintenance
charges. St. Louis and San Francisco
was able to show net earnings in May
of s1.259,173. compared with little
over 100000 in the same month last
year. The gross for May was under
that Of April and well under that of a
year ago. The ratio Of maintenance
for May was 29.7 per cent, compared
with 3S.5 per cent in the same month
in 1920. 1t is estimated that after all
adjustments the full bond interest
will have been earned in the fiscal
year ending June 80.