The New York herald., 1921-05-12
FINANCIAL NEWS
AND COMMENT
Steel Stocks Break Sharply
German Acceptance Not a
Market Factor.

The lack OF response in yesterdays
stock market to news that Germany
had accepted the full allied demands
was explainable partly through the fact
that expectation of that outcome of
negotiations had been a factor in the
rise OF prices late in April and the first
week of this month. II had been dis
counted for the time being. Traders
dealt with domestic developments. and
as they were comprised in the elimina-
ton of one or two dividends and discus
sion of the dividend outlook for several
Industrial companies In the current
quarter, prices were unsettled. Just as
evidence of unsatisfactory manufacture
ing conditions was reflected in reduced
returns to shareholders in March and
then contributed to the fall OF stocks. so
the effect of renewed consideration of
pending disbursements yesterday was
seen in heavy selling of industrial is
sues. Steels retreated with considerable
speed, declines extending from a point in
Steel common to more than points
among shares of competing concerns.
But the market was not uniform in it's
movement. Cross currents, discern BILE
at all times. indicated that while pro-
fessional hands were active they were
seeking to discriminate between various
ground with quite number OF special
ties. The market was conclusive of
nothing except that spectators had
made the most of recent constructive
nerable points where profits could be
gathered quickly by sharp attack. Call
money again moved up from u TO z
per cent. in the late afternoon.
In respect to the reparation situation,
the neglect of that important develop
ment was hardly indicative of con-
tinued attitude of the kind in the mar
kets. Clearly, the decision of the Ger
man authorities removes at the least
an obstacle which had prevented mer-
chants of many countries from shap-
ing even tentative plans for an expan-
sion of business with Central Europe.
There remain, of course many details
and methods to be completed for in
surfing the payment of the great repara-
tion installments, but the way has been
paved for Germany's financial and poll
tlcal leaders to calculate her national
budget needs and means for raising
necessary funds. No one expects that
active buyer of raw materials abroad
or a heavy exporter of goods If that
situation had been looked for, improve
ment in cotton prices might have been
expected yesterday, inasnuch as cotton
quotations have fiuctuated little during
the recent weeks when stocks were ris-
ing. Cotton declined. the direct factor
of first Importance evidently being the
poor outlook for increased manufacture
| ing in British centres because OF labor
troubles and the present light demand
for cotton manufactures In Europe.
| Says the Iron Age, Consumers opin.
ION OF IHe TNSlSllHb power VI tue re-
Gently adopted prices is plainly indi-
Gated by their abstemious buying.
which is another way of stating that
business has not improved materially
since reductions were made. So long
as orders hold off, the problem of costs
will continue to trouble the industry.
and the testimony of julius Kruttschnltt
OF the Southern Pacific before the Sen
ate Interstate Commerce Committee yes
terday supplied striking figures in the
relations between operating expenses and
the income paid by railroads to their Sc
curity holders last year. The burden
some portion OF labor charges in all pro-
duction costs. whether In producing
goods or transportation, is receiving
publicity which seems likely to be of
great Importance in what remains OF
post war readjustment. Mr.. I<ruttschnitt
pointed out that OF the s1.4e5. 300. 900
increase OF railroad expenses in 1920
compared with those OF 1919. no less
than sss4,o0o, 900 was accounted for by
labor.
Sterling exchange gained slightly. all
though francs were heavy. Marks,
rather surprisingly advanced from 1.56
to 1.62 cents each.