Evening star. [volume] (Washington, D.C.) 1854-1972, 1921-01-13
LIST SOFT EARLY,
SHARP RECOVERY

NEW YORK, January Is (SpeciaD.
There were more symptoms today
than there have been previously OF
the reaction which Wall street has
been talking about and working for
for the last week or more.
At the opening realizing sales set
in. and without so much aid from the
short interest. which had been the
mainstay earlier in the week. Prices
slipped off pretty generally Alter
the first half hour special ouYin"
movements were resumed IN a num-
Der of Individual stocks.
Mexican Petroleum. in which there
was still heavy bear account, was
run up above it's previous high. In
ternational Paper was bid up Sharply
There was again considerable m
terest on the buying side of some OF
the rails. notably Southern Rall~aF'
the Erie issues and ST. LOUIS South-
western among the low-prlced issues
and Reading among the hisher-prlced
issues.
The buying in Reading. was based
upon the anticipation of the early
of plant to separate
coal and railway. interests when
would be all to the liking or the
common share holders.
The strength in the junior rams
was accompanied by 4 good deal OF
new discussion of the possibilities
of 1921 being a year for railway COM
binatiOns and especially for the abb
sorption by some of the larger COM
panies of connecting roads that would
be useful traffic feeders.
The stock exchange money market
partially corrected the discrepancy
with outside rates. which had come
in for so much comment yesterday.
The quotation on standing loans was
reduced from to per cent. At the
same time bankers acceptances weak
ened perceptibly, with II prevailing
rate of 54 per cent for time (three
months paper, against the ca which
was asked up to short while ago.
The money market has now adjusted
itself to the easier drift of things in
every department.. with the exception
of commercial paper.
Here a special condition exists in
the fact that the banks still have out
standing an abnormal proportion of
this class of loans and are not only
reluctant to make any further ad-
vances. but are pressing for the set
tlement of existing credits. This pre-
serves certain urgency i'll the bor-
rowing demand sufficient TO maintain
the rate on commercial discounts at
the per cent level Liquidation in in
dustrial lines will have to go quite
a bit further. releasing a larger credit
supply. before quotations in this sec
ton of the money market are lowered.
Weak Mt Close.
The reaction in stocks became gem
eral in the afternoon. Outside of the
highly speculative issues which had
been leading at d premium. and in
which the short interest had been
badly squeezed there were few really
important declines. Motor and tire
shares came down rather more readily
perhaps than some of the others, but
only because they had had more than
the average recovery. Hide and
Leather preferred broke badly be-
cause of the fear that the next quar-
terly dividend viii be passed alto
gether.
The leather companies. moreover,
still have TO face further bad news
in the shape of their statements for
the last three months of 1920. which
will show the final result of the heavy
inventory writc-offs. This considera-
ton had its effect upon Central
Leather as we'll as upon the hide and
leather shares. Wilson & Co. slumped
violently when the directors announc-
ed a stock dividend in place of a divi-
dend in cash. 1t was announced that
Southern Pacific stock would not ne
quoted ex The rights tomorrow. as
had been scheduled. Heavy selling
continued in both rights and in the
new Pacific oil shares.