The Washington herald., 1921-07-29
STOCKSRRECULAR
EMARKET TREND
STAYS UNCERTAIN
Rails Display Moderate
Strength Late in
Session.
CALL MONEY 3k%
Cheaper Rates Are Reflected
in Better Buying of
Bonds.

, NEW YORK, July 2s.-The action
of the stock market continued to
be quite irregular. with trading
still on a modest basis. During the
greater-part of the trading the
same lack of trend which has char
acterized the market recently was
in evidence and the advent of dis
tinctly cheaper money was chleny
reflected in better bond buying and
in a moderate display Of strength
in rails during the afternoon
Equipment stocks stin were con-
spicuously weak, while steel ana
motor stocks were ragged Toward
the close the rails were fractionaily
higher. while industrials were ir-
regular.
Call Money Lower.
Cali money on the stock exchange
opened at Az per cent. which repre-
sents the lowest renewal rate since
September Is, 1919. Later the rate
was lowered to 4 per cent. and
at about the middle of the fourth
hour il was dropped to 315. While
the season is such as to make for
easy money, it must be recognized
that in the present instance spe-
ciaI circumstances exist. As a re-
suit of the general depression the
demand for credit for business pur-
poses II at a low ebb, while gold
continues to fow into this district
in large quantities. and the big
member banks of the city one by
one are paying of their debts at
the reserve bank. The result nat
urally Is an accumulation of idle
funds, which expresses itself in
lower rates.
Trading in exchange was dis
tinctly dull. with prices slightly
higher for the most part. Sterling
advanced s of a cent to $3.5TH, and
Italian lire, as a result of strength
in London. recovered 4h points at
T412h cents. The Scandinavian
currencies also rallied, as did Dutch
guilders. On the other hasd,
French and Belgian francs lost J
points, the former commanding
18Th cents. and German marks
were of "a points at 1.2S% cents.
Taken altogether, little business
was transacted. and IL would ap-
pear that for the moment. at least
most of the activity in this market
Is on the other side of the market
waits Cotton Report.
Cotton again showed the effect of
liquidation, which is based, appa-
|rently. on expectations that next
Mondays government crop report
will show an increased yield. oc-
tobe- sold as low as 11.SS cents,
and at a late price of 1904 cents
was of O. points on the day. The
long interest, which entered the
market for this commodity some
Hweeks ago. evidently has been get
| ting out for several days. Wheat,
after a show of strength, also felt
the effect of liquidation After
being as high as s1.2SS, the Sep
tember future broke as cents, and
6ater, at s1.26, recorded a net loss
of IL cents. Receipts continue
heavy, while export demand is
smaller.
Despite an increase of $4,000 in
circulation, the Bank OF England
statement shows a fairly sharp
gain in the proportion of reserve.
This weeks ratio is I5.2 per cent,
as compared with lis last week,
[The immediate cause of the i'm
provement is a large decrease in
k1eposits. the shrinkage amounting
10 -E42, 400, 900. this being balanced
by an approximate equal decline in
he holdings of government secur-
ties. What the statement really
tenects is repsyments by the gov
ernment of advances by the bank
The condition of government f.
aances is. however, such as to make
continuation of this tendency
Doubtful.
VIII Borrow Later.
On account of inadequate revenue
he government probably will have
o resort to renewed borrowing In
Ihe not far distant future and il is
his circumstance, combined with
fall demands for credit. which lead
.ondon observers to regard the
ext few months in the money mar
bet as a period of uncertainty
london, incidentally. expects our
wn monetary ease to be temporary
n so far as this view is founded
N the absorption OF funds 10
nance the crops, it is undoubtedly
yell founded.
The interesting feature with re-
ard to the French bank statement
a reduction in the discount rate
5h per cent. The French rate
thus placed on a par with those
the Bank CT England and the
hief reserve banks in this country.
he present change is the first since
pril 20, 1920, when the 5 per cent