The New York herald., 1922-10-26
FINANCIAL NEWS
And COMMENT
Foreign Exchange and Stocks
Under Pressure, but Rally
Lifts Latter at Close.

Only substantial rally in the late
trading yesterday saved the stock
market from a characterization of
weakness which matched that OF foreign
exchange Stocks throughout the day
We're under persistent pressure. and II
was not until two or three constructive
factors made their appearance toward
the close OF the session that any thing
like resistance to the general selling was
seen.
The turning point in the days mar
ket came after the announcement OF
tho resumption of the old s per cent.
dividend rate on PENNSYLVANIA Railroad
shares. This. OF course. was not sur
prslng, for 1t was forecast some days
ago by a director. Nevertheless, Penn
sylvania Is much less a speculative
stock. than an investors proposition.
and investors do not buy on forecasts
as a rule they await official action
Investors in Pennsylvania were quick to
extend their holdings as soon as the
dividend increase became an assured
fact. and former investors who had sold
when the rate was cut year ago were
not avcrse to taking their stock back
Indisputably the feeling in the finan-
cial district after yesterdays close was
infinitely better than on Tuesday. The
enveIoped the Wall Street community
on Tuesday had been lifted to large
extent by the close yesterday and In
terest In the stock market was benefited
thereby. What has been the nature or the
selling of the last few days and the
extent to which to may be expected to
20 are matters which. of course, only
time can definitely determine.
But the theory held In some quarters.
that selling by public spectators and
failure to support their stocks by In
siders in the leading properties were
largely responsible for the decline so
far is not entirely untenable. A number
Of effective arguments can be advanced
in support Of such theory. not the least
of which Is the character OF the buying
which market observers professed 10
see at times yesterday.
However, It cannot be denied that the
action of the stock market of late has
frightened out a very large percentage
of public participation and it Is no less
true that the difficulties OF staging q
bull movement without that same public
participation are manifold. So the fu-
ture of the market seems to lie in the
question Of how long 1t will take to once
moro attract a public following. There
has been no shange In the fundamental
bases upon which the rising movement OF
many months past stood. SO 1t Is scarce
ly worth while to look in that direction
for the reason for the decline or for
forecast of its extent.
An outstanding feature Of yesterdays
markets was a further decline In some
Of the continental exchanges to new low
marks for the year. French francs. the
leaders Of the present downward move
ment, broke beneath seven cents for the
nAA~ y,.A t@n
same time Belgian francs declined to
around 6.45 cents and Italian lire got
under four cents. German marks held
steady around their lowest levels, with
little activity. Sterling rates were un-
der pressure most OF the day. The con-
tinued heaviness OF exchange Is con-
ceded to be pretty largely the result OF
speculation in anticipation of the COM
ing conference on war debts, rather than
because of any basic fault in the gen.
eral foreign situation.
Foreign bonds recovered some OF Tues
days losses. The feature of the bond
new AZ per cent. Government bonds
which sold under par for the first time
since their issuance. The lowest quota
tion for these bonds on the Stock Ex-
change yesterday was 9s.s6 per hundred
dollar bond. The United States Govern
ment war loans were also under more
or less steady pressure all through the
session. These developments bear out
pretty we'll recent forecasts Of the state
of the investment market and indicate
that Secretary Mellon, when he decided
to make the new issue long term Az
per cent. obligation. gauged the general
situation pretty accurately.
Cotton was rather heavy under large
profit taking sales during the early trad
ling, but before the close of the session
the days losses were recovered and new
high marks established for most op-
tions Grain prices were generally