Evening star., 1921-06-16
OPENING STRENGTH
IS QUICKLY SPENT
New Lows Made in a
Day Of Daring Bear
Raids.
BY STUART p. WEST.

Ne" 1ORh, June 16.-"a all street
began BUSINESS this morning with
two definitely favorable pieces of
news. One was the lowering Of the
rate on commercial discounts by the
banks at New York and. Dallas; the
other the declaration after the close
of business yesterday Of the regular
dividend on Northern Pacific.
The reduction in the bank rate to
s per cent had been fully expected,
although it came a bit ahead Of the
time reckoned upon. The Northern
Pacific dividend action had been in
doubt right up to the meeting. The
themselves did not know what they
were going to do until they gath
cred around the board. and that the
decision to dip into surplus and pay
the regular per cent, was not
reached until great deal of argu-
ment had been heard, for and
against.
The first effect Of the federal re-
serve announcement was a further
rapid recovery in the foreign ex-
changes and a sharp upturn in the
share list. The total decline in ster-
ling from its hi igh of 81 was 80 cents
in the pound At today's high figures
nearly half Of this loss had been re-
traced.
In the stock market the overnight
gain in Northern Pacific and its COM
panion stock, Great Northern prefer
red, was two points. There was a
similar jump in the highly specula-
tive industrials of the type Of Mexi-
can Petroleum and Studebaker.
Bears Continue Raids.
Tbs rally was very brief. 1t was
followed before half hour was up by
a series of violent bear raids, directed
one after another against a number
of individual stocks. That these at
tacks were bolder than any hitherto
stocks that were singled out No
longer were efforts to depress prices
confined to the shares Of companies
which have either passed or are ex-
pected to pass dividends and which
have unfavorable business conditions
They included for the first tina
stocks that are in a strong position,
like the Woolen and Leather shares,
where there is no question that the
business readjustment has been COM
pleted; like American Car & Foundry,
provided for ahead with a special
treasury reserve. and like the To-
baccos, where the business situation
is particularly good.
1t was one Of the most daring and
at the same time fragrant pieces of
street has seen in recent years. 1t
was bear" operations, flushed with
success, carried on with the same
reckless audacity that bull" opera
tions were in the autumn Of 1919.
How much actual liquidation was
debatable matter. Here and there
there was some suggestion Of accounts
which had been undermined by the
tremendous decline as they were last
December being thrown over
But what the market chiefly re-
Of real holders to sell as general
unwillingness to buy. The public was
sufficiently intimidated by the spec
tacle of a months practically un-
broken fall. while the elements of
banking support which had appeared
in the market on Monday did not
seem to be present
Close Exeeedingly Weak.
The weakness continued right up
to the close of the session. In many
cases the low Of the day was the low
Of the year and the soft, declining
trend extended throughout the list.
there being scarcely an exception.
Mexican Petroleum added another
drop Of nine points share for the
day. Steel common dropped to 74ss
and the raiding Of the bears con-
tinued unabated to the tap Of the
closing bell.
Despite much reassuring news. the
tobacco shares were as badly OF as
others. Sumatra made q new low and
other shares in the group were bit
terly attacked.
In q market where the bears are %
fattened with profits favorable news
counte for little.
The absence of banking support to-
day was freely commented upon on
the street It 10 q question how long
this state Of things can continue.