The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1921-12-29
'TAKnlc OF PROFITS
CAUSES REACTION
NLAn TRADING
Stocks Trend Unchanged
During Great Part
OF Session.
INDUsTRIALs GAIN
Are Bid Up TO 8 Points Under
leadership Of Equipment
And Steel Shares.

NEW YORK. Dec. 2S-Up 20 late
afternoon the trend OF the stock
market and the character OF the
trading were the same as IN yester-
days session 1ndustrials were bid
up TO the extent OF to points
under the leadership Of the equip
ments and steel shares and with a
noticeable Increase IN the volume
OF transactions. II was plain
again that covering BY shorts was
one Of the moving factors and Il
YES equally evident when stocks
turned reaetionary In the later
trading that traders were resotting
TO proht-tsking. Gail money again
opened at per cent. went TO tis
early in the afternoon returned 10
the per cent rate and rose to So
in the last half hour.
Revival In Besss.
Some investment houses nbte
revival of inquiry for hirh grad.
bonds within the past few days but
are unwilling TO predict so early
the creation OF another situation
in which the investment demand
viii TOW over into the stock mar
ket. The general feeling is that
the Offering Of new securities has
been overdone for the time and
that these issues must find a sta
Bile position in the bond market be-
fore the recent contact between the
stock and bond markets can be re-
established. As an example Of the
renewed investment demand
large commission house which does
a large bond business reported an
order for sis0.oe0 OF bonds for a
single account and at prices slight
ly under the current level. The
prospective purchaser had been
waiting to see how far the market
would react.
stocks In Bull Move,
Three groups OF stocks were en-
braced in a single bullish argument
set forth in certain market quarters
today. They were the rails, the
steels and the equipments Tho
stiffeninE of railroad stock prices
today would have been sscribed 20
railroad statements Of the bigger
systems were IL not for the fact
that the better demand for rails
was preceded by a sharp rise in
equipments. This latter move.
which continued today with only
slightly diminished force. was ac-
cepted as rejecting confidence Of
important business in this. that rail
business next year is to be such as
TO warrant heavy buying Of cars
and locomotives and extensive re-
pairs Of old equipment The same
argument was made 10 apply to
steel stocks first. in a particular
sense as suggesting one definite
source Of demand for steel and sec
ond in a general sense suggesting
revival OF business from which
the steel industry could not wei
hold aloof.
In other quarters a wholly diff
ferent explanation for the rise in
equipment stocks lie offered. Need
less TO say. since IL casts reflection
on the substantial character OF the
buying in EQUIPMENTS Il questions
also whether the rise in this group
is-s good aurury for the rails and
steels. One large brokerage house,
which follows the source Of buying
stated today that IL would not fol-
low the movement in American To-
connective. despite the high chsrsc-
ter OF the company. because q felt
that thir was a speculative move
ment made by big traders and not
by insiders
Approaching the psychological
effect OF merger talk professionals
do not hesitate 10 link M the names
of companies whose stocks make a
conspicuous move in the market.
A few days ago when American I,o-
connective started TO go forward IL
was a moral certainty that the ccr7-
psny would be made the subject Of
one or more merger rumors.