The Washington times., 1922-05-28
NEW YORK, May ~.

Tho action or the Interstate So'
merce Commission in ordering
horizontal reduction OF 10 per cent
In rates has, Of course. exerteo =
disappointing and discouraglnS et
feet on the market. NeVertheless'
tho inherent strength or the raiis
has been 30 great and the Seheral
buying power Of the community 30
vigorous that no material effect mas
been produced by 1t. The CHIEF IN
fluence Of the action has apparently
been that OF preventing advances
which would otherwise have takeh
place. II is still uncertain whether,
in fact, corresponding reductions OF
wages will not suffice TO put tne
roads into position to meet the con
ditions established by the new 'at""
and II SO the general benetlt u the
community will be seen in an en-
larEement Of traffic movements. In
creased earnings are necessarily ere
ating more confidence In raliroau
shares, pending the time when the
full effects Of the rate decisions arc
seen. This is especially the cas-
with the Fries, Reading and other"
that are standing out prominently
Consolidation reports here ;:nd ttere
are dlbO IlANlnk lhclt udo CAASNh'
The Merger Movement.
Merger prospects and rumors are
likewise exerting an important III.
fluence in the industrial section OF
the market. The steel merger, 1t Is
true, has thus far evidently failed tC
come to fruition in the way expec'c'i.
However, what In left of the proposed
combination is enough to keep up the
interest in the probable outcome as a
stock market factor. particularly H.
view of the fact that the Industrial
prospects OF steel are continuously
good. An increasing percentage or
plant capacity Is at work, and there Is
an upward tendency in prices which
combined with the strong buying
power that Is making itself felt In
the railroad and automobile ficlds,
necessarily confirms the improved
prospects Of earnings which nave
been based upon conditions develop
ing during the past month or two.
Az for the mergers which ere under
discussion in various other branches
of business, including not only all.
but also such widely divergent COM
modities. as groceries and others,
their influence is thus far uncertain
as an ultimate factor. although :he
imme date effect has been 10 advance
current values.
Effect Of Business Improvement.
The effect of business improve
ment. however. Is seen i'm other
lines where merger talk has had but
little II any influence. Copper stocks
have become again favorite ele-
nj fOV
the metal increasing, and producing
a corresponding effect upon prices,
with the result that the resumption
of dividens in the case OF various
mines Is now confidently expected.
Business Improvement is also ad-
vancing values in the case OF some
Of the shipping shares, where slight.
ly better tonnage rates and de-
cidedly better volume Of export
business have exerted an influence
in advancing the earning possibili-
ties Of the different concerns. These
are reflected In higher quotations.
Very large production In some Of
the principal automobile plants and
continued large forward orders In
railroad equipment have led to
stronger prices in those fields. In
fact, there Ia hardly general
group Of stocks In which the
brighter business conditions do not
show themselves very distinctly.
This is an encouraging state of
affairs and one which has resulted
in a much moro permanent and In
fluential effect on the market than
could have been expected as the re.
suit merely Of speculative transac.
tions or rumors Of business ad.
vance.
While nothing definite has vet
been accomplished IN adjusting the
foreign economic and political sltu-
alton, the conference OF bankers
now In session at Paris has do.