Evening star., 1921-06-27
MARKET IS QUIET
PRICES ARE SOFT
Feature of Day Is Sharp Rally
in Sterling Exchange.
Notes.
BY STUART p. WEST.

NEW YORK, June 27.-The stock
market started in this morning some
points up from the Saturday closing.
At the high level reached during the
first hour the leading speculative
issues had risen from last weeks low
all the way from to IL points. 1t
was the characteristic swift rebound
of a market which has been pressed
down too far probably by short selling
and probably by liquidation that was
either involuntary or ill-considered.
The rule under such circumstances
is for this sharp recoil to be followed
by setting back of prices and a
greatly diminished trading volume. 1t
was this sort of setback which Wall
street experienced today.
The logic of such a movement is
that while the main selling may be
over. investors are unwilling and
speculators timid about following up
the first rally. The top. prices OF this
rally had been paid by frightened
traders on the short side, and this
covering demand having been salts
fed. there was nothing to sustain the
markets higher level.
Unlike last week, when the STOCK
exchange was the center OF interest.
it was not the stock trading. but the
foreign exchange movement whlch
furnished the main incident OF the
day.
Sterling exchange rose over cents
in the pound. the entire gain occur
ring before New York was open Tor
business. While there was some re,
action later in the day. the principal
part of the rise was retained
There were two explanations to De
given for this upturn. first. that II was
a response TO the indications OF an
early settlement of the great EnEHsh
CT ri
shadoWed recession from the pol
icy Of requiring Germany to make the
bulk of her cash settlement no repara-
tions account in dollars.
Suggests End OF Strike.
The fact that the advance lin ster-
ling was much more extensive than
the rise in continental rateS-whlch
was very moderate and perfunctory-
seems to suggest that the English Ia
Dor settlement was the more lnpof-
tant factor of the two.
But there is no reason to doubt the
press reports of the last few days.
which have stated that the repara-
tions commission sees the mistake it
made in bringing about sudden de-
mand for American dollar credit of
such urgency as to completely de-
moralize the exchange market.
1t may have been official Washing
ton that had something to do with
bringing home to the commission this
clumsy handling of things and i'm
pressing tha damage likely to result
to the international trade if the at
titude was maintained
But in any event it is fairly sure
now that there will be no repetition
of the violent disturbances of three
weeks ago in the exchange market.
but that further German pa=mentS
will be divided between dollars and
the currencieS of the European allies
so as not to entail any extraordinary
conversion of sterling or francs.
Coal Road Earnings.
May earnings of the coal roads have
so far been below the average of
other railway systems in the same
localities. practical instance of
this is the comparison between the
gross results for last month on the
Pennsylvania and the Baltimore and
Ohio. Pennsylvania has. of course. a
large coal traffic, but nothing like the
Baltimore and Ohio's in proportion
to the volume of all freight The
Pennsylvania gross was ahead of last
year s365. 900. while the Baltimore and
Ohio's was down s2.54OO0O
The explanation lies in the falling
off in the demand for coal from in
dustries. like steel. which are at a
low ebb of production. Meanwhile
partly by reason of the cutting down
of working forces. but more likely
because of curtailed maintenance, the
May net on both these roads shows
up well. That for the Baltimore and
Ohio was sl.6s5.0OO. or slightly better
than last year. while PENNSYLVANIA
succeeded in changing deficit of
s5.721.o00 in May. 1920. into a surplus
of sS,s49.ooo in May. 1921.