The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1922-01-28
FOREIGN EXCHANGE
STRENGTH MARKS,
STOCK EXCHANGE
Recovery in Commodities
Aids in Overshadowing
Narrow Price Changes.
PESSIMISM ERASED
Market Left Without Incen-
tive in Absence of Con-
structive Factors.

NEW YORK. Jan. 7.-PronounreI
strength in foreign exchange and
a substantial recovery In the COM
modity markets Oyershadowed in
Importance the narrow changes fn
stocks. Yesterdays outcroppinC Of
pessimistic sentiment was short
lived, disappearing overujght aud
leaving the stock market. in the
absence Of any constructive factor.
with no incentive for a move IN
either direction. Prices fuctusted
within a point OF the Thursday
closing level except in the case Of
a few issues sponsored by profess
sional operators. Cali money re-
newed at per cent and went to
5is per cent early in the afternoon.
The bond market was barely steady.
BY raising a question about the
prospect of the American Sumatra
preferred dividend being paid. pro-
fessionals succeeded in depressing
both classes OF stock today. The
preferred sold on 80 points ycstcr-
Gay and an additional ~ points
today. bringing the price down 70
the lowest on record. Dividends on
the preferred arc cumulative aud
payable semi-annually. the uc,t
I..
Doubt about the rcNt dividend is
based on the fact that at the Close
Of the last fiscal ycsr-July 81. 1929
the profit and loss surplus was
only Sl.553.O0C-a sum that may D..
insufficient to sustain an inventory
write-oft and at the same time pro-
vide for preferred dividend.
United Fruit.
The United Fruit Compauy's earn
inEs for the calendar year 1921 we've
small by comparison with those OF
the preceding year. but they were
more than enough to coIcr the
per cent dividend twice. This lat
ter fact deprived professionals 81
a good selling argument TODAY. The
company earned at tho rate q
$3.50 a share on the 500. 600 .0Oa
stock as compared with S5S.Oe a.
share in 1920 on the $50. zoe. geo 90
stock then outstanding. For com-
parative purposes the 1890 earnings
may he set down as s2s.OI a share
on the SlOO.00O.O00 OF stock out
standing after payment Of the Lea
per cent stock dividend last JanU-
airy.
The request for options on Goi'
states Steel stock was effective
enough as a market factor. and u
has vet 10 he proven that some in
terCsts are seeking TO gain control
OF the company. But such a devcl-
opment has often been used as a
speculative trick. and traders were
there fore wary Of Texas and Pa
cific Railroad stock today. follow
ing q report that some stockholders
had been asked to give an option
on their holdings at "A price above
the present market. The stock went
up 4 fraction. Interests close -
tho TEXAS and Pacific l;ailroad are
looking for an carly decision Oh
the appeal in the N!sScuri-paCi1s
litigation.
The rise in foreign exchange to-
day put a damper on ono Of the
current items Of professional b-sr
Iropa Eanda in the stock Iuarktr
community. lnasmuch ~ there had
heen nc really good news I'm sight
Cor several days, shorts thought
yesterday an oppoTtuuc t.Inc for
conveying the impression that 4
change for the worse in tho eco
monte situation-domes;ic and in
tcrnatioual-had come. They made
much Of the Washington reports
that the administration will h"
asked for a postponcment Of the
Genoa economic conference. That
looked bad for Europe and our for
Cign trade. they pointed out. Eut
/ the rise in sterling. francs and thr
other principal exchanges today
| took all the sting out OF that bear
argument. The rise suggested that
Europe was not disturbed.