Evening star., 1921-11-25
STOCKS ADVANCE
/ TO HIGHER LEVELS
Sharp Gains in Dividend.P Pay
ing Rails and Also in
IndustriaIs.
BY STUART r. WEST.

NEW YORK, November 25.- Re-
newul of investment buying in a large
way was the feature today in both
bond and stock markets. The gem
eral average of bond prices drove
forward again. The investment move
ment showed itself in stocks, par
ticularly in the new high prices
reached for the standard dividend
paying rails, and also in the strength
of other investment issues of the
type of the industrial preferreds and
American Telephone and Telegraph.
Again there was occasion to observe
that in view of the rwopderIul back
ground afforded by this investment
buying movement theories of re-
action in the speculative list were
apt to be upset.
For the last fortnight or more Wall
street letter writer's have been talk
ing about a downward turn as the
logical sequel to the October ad-
vance. They have merely represented
the general run of professional opin-
ion. SO far this attitude has been
not at all profitable to those who
have followed it.
To be sure. there We're many of
the recent leaders which for week
if they had gained nothing, they had
lost nothing either, while all the i'm
portant moves in the special stocks
were upward.
Kill Reaction Theories.
But it remained for today's market
to cause still further discontinue to
the reaction theories. At the start
it looked as If il We're to be merely
another day of operation in special
ties, with the general list dragging
along listlessly.
But the presence or an overhqw fu-
vestment demand from the boad mar
ket soon began to tell. First IL was
the rails. which started forward With
Union Pacific Canadian Pacific and
0arious others working into new hiSt
ground.
From the dividend paying rails the
buying shifted into one group aftsr
another of industrial STOCKS.
Mexican Petroleum and Pan-Amer'-
can were bid UP sharply. anticipating
the declaration late today of the
regular dividends. The American oils
promptly fell into line. Then came
Baldwin Locomotive and then the
steels. the latter responding more
han they had on Wednesday to the
statement in the trade reviews that
the Steel Corporation was operating
at SO per cent and the independents
1t 40 to so per cent of capacity A
20. per cent capacity nowadays would
be. pretty close to 100 per cent
capacity before the war.
Standard Rails strong.
The same explanation that has been
noted right along applied to today,s
sNength IN the old-line dividend
paying rails. Investors, feeIng that
, the highest grade bonds and many OF
the industrial preferred stocks have
got out of range. are going into Sc
curities. which, although reasonably
safe, have a speculative element in
their makeup.
Union Pacific, even at 125, where 1t
started in this morning, returns per
cent, which is very attractive in a
market where 5is. and 6ls per cent are
! prevailing yield on bonds and stocks
af the better class. The buying in
Canadian Pacific. Southern Pacific.
Atci1ison and various others similarly
situated-where the dividends haye
been earned during the bad times and
where a substantial surplus is now
| being shown-has been for some time
coming from people who have been
paying for their stocks outright.
+ Stocks of the weaker roads which
have difficulty in earning their fixed
charges made only feeble response
again today to the advance in the di-
vidend stocks.
There were only three non-dividend
payers which did anything notable.
One was Missouri Pacific preferred. in
which there has been some important
buying recently founded on the eN-
pectation that some time next year
dividends will be resumed. Another
was Texas and Pacific, in connection
with which there was talk of set
tlement of the litigation with Mis-
souri, Pacific regarding the accumu-
lated interest on the Texas and Pacific
income bonds. The third was Colorado
and Southern, which could easily go
upon dividend basis a any time and
still have a handsome margin left.
, Americas Telephone.
There is reason to believe that the
heavy selling which carried American
Telephone and Telegraph down from
it's high around 119ik to 114ss was
precipitated by the sudden unloading
of large holdings by an estate. This
selling was apparently completed by
the close on Wednesday and this
morning American Telephone and
Telegraph started upward again. Even
at lis the yield is over 7% per cent.
while it would be X per cent at 12O.