The New York herald., 1921-06-30
FINANCIAL NEWS
AND COMMENT
Stocks Continue Advance De,
spite Rise of Call Money
Rate to 6 Per Cent.

Ihe advance or stocks went further
yesterday under an increase OF business,
compared with Monday and Tuesday,
the movement being retarded hardly at
all by rise of the call loan rate from
5l5 per cent to per cent. In the after
noon. A stiffening Of money had been
expected before the week end. and
therefore was less OF a market factor
than 1t might have been had the Street
not been imbued with the belief that
case would appear again after July I.
An indication that the short interest
had been impressed during the last few
days by relative scarcity OF offerings
bile shares which. with the exception of
Studebsker. had been rather sluggish
for considerable time. The more promi-
nent feature. however was the persist
ent strength of steel company shares.
which drew in with them one or two
railway equipment issues. The recov-
cry of steel stocks occurred in the face
of the weekly trade reviews. which cer-
| tainly indicated no general improve
ment of mill operations. at the same
time recounting the settling of prices
toward lower levels. Rail shares were
firm, although advances were less Wig
orous than they were on the day before.
The question which occupies the cen
ter of the stock market stage just now
is whether or not the constructive in
fiuences at work In respect to the rail-
roads and in money and credit will soon
have a sustained force in prices There
is no question In minds familiar with the
railroads and the banking situation that
economic events and the attitude of po-
litical and financial leaders are working
for better things The factors which
make for caution in stocks is uncer-
tainty about industry and whether or
not there will be expansion during the
summer to a degree to expand earnings
of the carriers and to enlarge the pur-
chasing power of the public. The sea-
sonal movement Of grain and cotton will
come along at the same time that the
roads Tighten their costs through re-
duction of wages. The expectation Of .
after July /. is evidently a factor in
purchases of railroad shares. bat the
lack to date of genuinely broad buying
campaign indicates that investors desire
to see some distance ahead before ac-
cummulating lines of stocks.
AS far as money is concerned, the
best opinion expresses confidence OF
further improvement in the bank posi-
tion during the next few weeks. Evil
IDENTIFY a steady liquidation of frozen
credits is going on In quarters in which
the outlook two months ago was rather
difficult and the financing of goods
which must be carried on until markets
improve has been arranged on broad
scale since June / in a fashion which
lessons the burden OF lenders. With a
real relaxation OF money 1t is to be
expected that new offerings of securi-
ties for working capital and to release
bank loans will increase.
The foreign exchanges by receding.
especially sterling with 2 cent de-
cline. seemed to show that spectators
were doing very little because of lack
OF information about the exact manner
in which German reparations payments
were being handled. During the origi-
nal transfer OF German funds to New
York at the end of May and later specu-
lation was an important factor In caus-
ing violent swings of European ex-
change quotations. but now the Repara-
tions Commission Is receiving payment
in several currencies and is looking
after the conversion of those currencies
into dollars, a process which leaves the
speculator in doubt as to methods and
time of operation.
Wheat futures regained much of their
loss of Tuesday through gains of more
than s cents a bushe on short cover
ing and an increased demand for ex-
port Cotton, however. sagged under
dull trading.