The New York herald., 1921-08-31
FINANCIAL NEWS
AND COMMENT
Rally Sends Active Stocks For
ward-Sterling Exchange
Moves Up.

An overdue rally or c0nSidera bic pro-
portions set in during yesterdays mar
ket in the New York Stock Exchange
and as result OF short covering plus
the appearance of new buying to mod
\ crate extent. net gains OF fractions to
\ five points In tine active list were
\ recorded. The news and events bearing
on speculation all turned in one direc-
/ tion. Cotton scored a sharp rise. The
advance in sterling was the most vigor-
Gus in nearly sixty days. Cali money
was In free supply at 4l5 per cent. with
about $4,000 loaning at per cent.
A long series OF favorable railroad re-
ports for July made an impressive show
/ ing. These constructive factors APP
! peared just when the public had made
! up its mind that the alteration of Ger
man payments from all cash to pay
ments in kind was a development OF
major Importance. Trading started
rather unevenly and by midday the
| floor presented a holiday tone with the
volume up to that time at the rate OF
about 10000 shares an hour. During
that period quiet fresh buying had
cared for the limited offerings Of stocks.
The professionals We're among the first
to see that the short side had lost Its
popularity for the time being and early
in the fourth hour prices hardened and
short covering ensued. The volume or
| transactions trebled and the days total
was well above 100000 shares.
\ Whether yesterdays upturn will be
followed by further gains and by sitter
resistance to bear attacks or not, there
was a decidedly more confident atmos-
phere in Wall Street yesterday. Causes
for rumors disappeared considerable
time ago, but rumors themselves were
dismissed as idle cha.f and talk that
now is the time to buy them for the
long pull was frequently heard. Techni-
cally the market was in q more heavily
oversold position than many had rea-
lized and a turn was inevitable. It must
not be forgotten, however. that the mar
ket Is a two sided affair with the pre-
ponderance or power in the hands OF
the bears, who, it is anticipated, will
offer further resistance to the specula-
ton for the rise. But for the moment
the more active speculative issues were
in strong request with such gross adj
vances as 31s points in General Electric.
5ia points in Mexican Petroleum, u In
Crucible Steel. 3s4 in Chandler Motor
and 55s in Atlantic Gulf.
The easier tone in the call money
market was In line with predictions. but
1t IS evident that a rate below per
cent is too low to keep funds available
for speculative purposes. After renew
inG at per cent. In the New York Stock
Exchange. with a rate OF Al per cent.
outside. the rate dropped officially to
al per cent, to remain there for the
rest or the day. For out of town money.
which makes possible such low rates.
there are many channels Of short term
and liquid investment which afford bet
ter opportunity for earning power, and
continuance OF the present glut may lead
to a diminution Of the supply early next
month. Normally September is a period
of heavy crop. demand for funds. and
next month should prove to be no ex-
ception. especially in view OF the large
and speedy transportation movement Of
wheat and other crops. For the mo-
ment, however the call money supply
Is sufficient 70 meet all requirements.
Business In time money was Mt stand
still and acceptance business was dull.
on the current recovery In sterling
exchange a new high for the movement
was recorded at $S.7OSs. a rise OF is
cents. There was nothing spectacular
In any exchange movement. but firm
ness predominated throughout the day.
All continental rates shared in the tone
OF strength with the largest percentage
rise recorded by exchange on Copenha-
gen. Brazil rates recovered Mondays
losses. Brazilian exchange being helped
by success attained by the offering Of
ST.. 100000 OF Brazilian Government
bonds. There was a moderate decline In
rates on the Argentine Republic and
slump In the Uruguayan peso carried its
quotation down 10 64h cents. Although
grains were heavy. the rise OF 80 to 40
points In cotton permitted the rise in
that product TO continue. Bonds were
active and for the most part steady. The
Brazilian Government bonds. although
put out on an S.t5 per cent. basis
gainst the preceding Brazilian issue to
yield S4 per cent. were more than
doubly subscribed.