The New York herald., 1921-01-29
FINANCIAL NEWS
AND COMMENT
Rails Move Up When Stock
Trading Turns to Them
Sterling Exchange Off.

AhlVASSe was inSliicu INTO uuiI mar
ket for stocks yesterday by a forward
movement OF the railroad group At
the same time buyers of Industrial is
sues. chiefly in the specialties, had to
lid for them, as offerings came out
reluctantly. The result was a fairly
strong price list all the way along.
with Great Northern preferred. New
York Central. Northern Pacific. Ches-
apeake and Ohio and Lehigh Valley
standing among the leaders. The gains
ran from 1 point to points. Some
of the steel shares were heavy. others
were firm and the same uneven situa-
ton existed In the cases OF petroleum
and miscellaneous manufacturing COM
pany stocks. Call money stayed firmly
at per cent. and time loans were
made in small volume at 61a and z per
cent.
Little appeared In the days develop
ments to explain the switching of trad
ing attention to the rails. Possibly
speculative sentiment was influenced
by the evidence OF improved Invest
ment conditions for high grade railroad
bonAs. as contained In the great sue
cess of the s6O.00o.OO0 Pennsylvania Rail-
road offering on yield basis lower than
it was when that corporation put out
somewhat similar issue last spring.
NEED of encouragement also was
contained in certain December state
ments of earnings. The Norfolk and
ing income of $.3i7.5Oo during that
month, in contrast to $367. 100 In Decem-
fber. 1919. The Missouri Pacific mad
net return Of sl,354sO0. in contrast to a
deficit of s321.o0o year earlier. and the
Lackawanna, whose coal traffic is the
backbone OF it's business. reported
net from operations amounting to
81, ,146. 500, against sl24s,3oO. It is prob
able that December saw something OF a
slackening of maintenance charges COM
pared with those OF November. but con-
trast with those Of December. 1918. was
not possible because of lack of detailed
figures
In viewing the railroad stock market
sight should not be lost of the important
movement undertaken by representatives
of the carriers in Chicago to lessen the
application of labor agreements entered
into during the war and afterward. The
contest promised between railway man
agements and the labor organizations
cannot be visualized as yet but II Is
patent to any one who has watched the
swelling of operating costs because OF
the several wage increases that pairing
down of railroad pay schedules would
have a highly significant application to
net income.
The reaction. which more than one
banker thought was overdue. came in
the foreign exchanges. carrying sterling
down az cents from the final quotation
OF Thursday. The rate on London weak
ened at the start of business. Sight
drafts sold at 3.s7% at the start. off
three-quarters of a cent and French
francs from cents each worked down
to 6.S6 cents. The Canadian rate fol-
lowed sterling. and II was probable that
European rates also were shaped by the
immediate response to selling orders in
sterling which originated extensively In
London. Had the reverse swing of the
exchanges not been forecast to a degree
in the swift advance of IL cents In
sterling in a week. more emphasis might
have been laid on the attitude of tho
British representatives at the allied con-
ference in Paris. The cabIed news dur
ing the day indicated that Britain was
not ready to consent to Frances pro,
posals in respect to the German In
demnity.
The weekly mercantile surveys were
more definite than they were in the pre-
ceding fortnight In their description of
business Improvement In certain lines.
II is natural to find goods largely tex
tiles. In which prices have appeared
stabilized for some time are In best de-
mand and that process is furthered by
the fact that liquidation OF late reached
proportions sufficient In some wholesale
and retail fields to induce a fresh ac-
cumulation of moderate stocks.