The New York herald., 1921-05-28
FINANCIAL NEWS
AND COMMENT
Upward Trend of Stocks HaltS
and Reaction Sets In Be-
fore Session Ends.

Influences which tend TO shape specu-
etive ventures in stocks were yesterday
hardly of a character to hasten short
covering. even on the eve of double
market holiday. The rising movement
of Thursday. therefore. halted and be-
came converted into reaction before the
end of the initia! half hour of business,
and later brief rallies were insufficient
10 prevent a weak to heavy tone at the
close The automobile issues were sold ex-
shares receding further than the others.
and a sharp fall of Virginia Carolina
preferred amounting to more than
points. supplied the outstanding exam
pie of the effect of dividend discussion.
The steel stocks were subjected to pres
sure after the Street had deduced from
the remarks of Judge Gary and other
prominent manufacturers at the spring
meeting of the American Iron and Steel
Institute that although good times were
looked for after a while the road to
prosperity probably would be marked
by further price cuts.
Chief among the factors behind the
softening of stock market quotations
were violent fall of certain European
exchange rates and the marking up OF
call money from per cent. to TIA per
cent 1t was not the rise of the money
rate itself so much as the fact that
loans were called on a broad scale. ne
cessitating new arrangements for brok-
ers to carry over until next Tuesday.
Heavy Government Withdrawals this
week and the accumulation Of funds for
corporate needs over the month end ABB
sorbed so much of the supply of money
that 1t was rather difficult for late bor-
rowers on collateral to fill their require
ments late In the day. Time money
was reported scarce at per cent.
Fluctuations of exchanges continued
to be puzzling to bankers although ex-
plantations hinged on German repara-
ton payments seemed to have more
plausibility than before In view Of news
that the German Government would de-
Preparations Commission treasury bills
covering the $200.000.00O due on May
81, which provide for the heaviest pay
ment to be made In New York, other
Paris. Sterling fell back more than "a
cents, some transactions being reported
S cents lower than the final rate on
Thursday. Francs receded about
guilder and lire quotations. A substan-
tial recovery occurred before the close
of business. A natural assumption was
that the accumulation Of credits In dol
lars was being FASTENED. causing selling
of sterling and other exchanges in Eu-
ropean centres as conversion OF the pro-
ceeds of bills into New York exchange
progressed. 1t was not known when the
German Treasury bills would mature.
but ninety day period was suggested
in banking circles. This would suggest
frequent periods Of pressure on ex-
changes In the next three months and
mako unCeTtdl Tie movement Va AoeSo
from day to day.
Cotton prices gained only a few
points, despite crop estimates from pri-
vate sources which would have been
considered decidedly bullish In years of
normal supplies and consumption. The
National Ginners Association made the
condition of the plant as Of May rs
only 63 per cent. with the indication OF
yield of little more than 100000
bales. An estimated decrease of 81 per
cent. in acreage told its own story of
the product of the great fall of prices
since July of last year. Wheat declined
for time. but recovered in the after
noon, short covering carrying the May
option up cents from the lowest price
of the day. But late resumption of
selling left quotations a half cent to I VI
cents a bushel lower than on Thursday.
Corn futures advanced.