The New York herald., 1922-08-20
FINANCIAL NEWS
AND COMMENT
Prospects of Rail Strike Settle
ment Take Stock Prices to
Higher Levels.

Keen interest developed in the stock
market yesterday as a result OF the con-
structive railroad news Of Friday after
noon, which indicated that probably the
middle OF next week the railroad strike
would be definitely settled.
Speculation in railroad shares domi-
industrials came in for a share OF the
enthusiasm. Any disappointment that
may have been felt because no settle
ment was made at the meeting OF rail
executives and brotherhood heads on
Friday was offset by indications that
the delay was but temporary and that
within a week the strike of railway
shopmen may have become a thing Of
the past.
Shorts were put in difficult posi-
ton. From the opening they made
frantic efforts TO cover and It became
necessary for them to bid stocks up
from one to points and more in order
TO take back the shares they had put
out within the last fortnight on expec-
tations Of bad break.
Short interests in the rail stocks had
become somewhat overcrowded. They
had been encouraged In their operations
by reports from Washington that Presi-
dent Harding intended to ask Congress
for authority to take over the rails for
operation by the Government during the
present emergency and. remembering
what happened to railroads and rail-
road shares when the Government last
had it's hand in their operation. they
sold railroad stocks with little fear Of
retribution.
Although some a the lower priced
rails came In for a share Of attention
1t was among the higher grade dividend
payers that the real buying enthusiasm
was most noticeable. Such issues as
New York Central. Norfolk and West
ern. Union Pacific, Great Northern,
Canadian Pacific and others Of that
class We're eagerly bid for and advanced
easily when the real scarcity OF available
stock became apparent.
Traders on the long side Of the market
have maintained for weeks that it was a
mistake to sell rails on expectations Of a
decline due to the strike, and events
have proved the wisdom OF their posi-
ton. Not only have the rails advanced
steadily IL somewhat narrowly. from
day to day. but the first sign OF real
rift in the strike clouds reveals the ex-
treme paucity Of offerings
Some Of the equipment shares. which
frequently follow the rails in their up
ward swings. were in heavy demand
yesterday. Baldwin got up to 1265
and American Car and Foundry to III.
United States Steel duplicated its years
high made on the preceding day when
1t sold at 104i4 and other steel issues
were fractionally higher. Nowhere was
there any sign of special weakness.
Some of the specialties in which specu-
lation has been more or less heavy re-
Gently and in which gains of more than
average extent have been recorded re-
acted bit on short covering.
In the cotton market there was a
sharp upturn of prices following the
selling of Friday. The principal reason
assigned for this reversal was the
change in the Texas weather situation.
Early reports OF heavy rains were later
modified to indicate that only light
showers had occurred. The short ses-
sion In the cotton market netted a gain
OF approximately 20 to 80 points in all
options.
Bonds were very quiet. with Liberty
issues shaded slightly. In the case OF
the Liberty 3 ias there was a rather
sharp selling movement. entirely unex-
planned, which carried them down for a
total OF 6s cents. Other Libertys
dropped from five TO ten cents.
Foreign exchange transactions were
almost at a standstill, with only the
smallest of changes recorded in various
rates.