The New York herald., 1922-05-02
FINANCIAL NEWS
AND COMMENT
Speculation for Rise Shoots
Steel and Oil Stocks to
Higher Levels.


with success among issues which car
ried with them new incentives FOR pur-
chsses. notably steel and petroleum
stocks, but the rank and file were highly
irregular and business was rather quiet.
Steel merger preparations have reached
the stage where the speculative in,agina-
tion can get some action. The fact thai
managers OF large independent COM
panics are personally examining
plants, aided by their engineers. srg-
gests that the long discussed CONSOLE
dation is near at hand. The additional
fact that, with comparative costs against
them, American steel mills are competing
successfully with British, German and
Belgian concerns in the world markets,
forecasts more favorable results front
centralized production. The economic
aspects of the merger program are. how
ever secondary in the stock market 10
efforts to guess the prices at which
shares OF component companies should
go into a consolidation. and tho latter
were seen plainly In yesterdays sharp
advances of Republic Iron and Steel
and Lackawanna. the overflow OF buy
ing being revealed in forceful gains in
crucible and some junior steel issues.
The oil stock upturn, which added
sizeable gains to last weeks improve
ment, was explained supcrflcially by
expectations of crude oil price Increases
and large consumption of gasoline and
other refined products in the next few
months. But It may be said, also. that
the more substantial speculation in them
has been based on belief that the write
offs made by leading refining companies
on 1921 business were drastic. putting
the corporation in position to carry Oh
their activities in 1922 on practically a
new basis. The losses, where any were
incurred In inventories and development
work last year, have been absorbed and
the we'll established companies are
strong in working capital for the busi-
ness which lies ahead.
The sluggish state OF the rails and
many Industrial issues seemed to show
that public buying. checked by last
weeks reaction, was slow in coming
In again. a rather narrow list of stocks
dealt in. compared with recent stand
ards, and a turnover not much In ex-
cess OF 1000 900 shares Indicated a
slackening of general interest and a
desire of public buyers to wait for new
developments with a bearing on in
dustry. A lack of positive news from
Genoa removed the conference for the
time being from consideration as a
security market influence. Russia's de-
cision on the allied program for her
Industrial rejuvenation is what the
markets are waiting for. although the
slight effect which other happenings
in the meeting have had on foreign ex-
changes and foreign bonds suggests that
coming events are not likely to arouse
enthusiasm or promote disturbance.
Bankers on this side are paying more
attention to preparations for the later
meeting on the German situation than
to Genoa The exchanges were altered
very little in yesterdays transactions.
sterling at 4.42ss being a trifIe firrner
than il was on. Saturday. while francs
and marks were about the same.
Call money went from 4 per cent. to
~ per cent. the moderate advance dis
closing nothing unexpected in the loan
situation. Local traction bonds were
prominent at the same time that deal
ings In Government issues and rail
investments showed steady price tone.
Cotton came out of its rut when
Department OF Commerce report In
dicated a 100000 bale consumption
this year. an amount 100000 bales in
excess OF tho years world production.
All the options went well above tho
Is cent a pound level.