The New York herald., 1922-09-30
FINANCIAL NEWS
AND COMMENT
Stocks Rally Despite Disturb
ing Turkish News--Short
Covering Apparent.

Considerable confusion appeared In
tho financial district yesterday. follow
ing the publication Of dispatches from
the Near East which were probably
more disturbing than at any time since
the decline started. In the face of this
sharply, sterling broke to 4.36M and
grain, usually strong on war talk, was
decidedly weak.
This only served to emphasize the
conviction in the Street that the move
ments of the last few days in the se-
curity markets have been less related
to actual developments abroad than to
technical considerations within the
market. The rally in stocks yesterday
had all the earmarks of short cover
ing movement and at no time was there
satisfactory evidence to support the
theory that the interests responsible
for the professional assault on the gen.
eral list were thoroughly satisfied with
the result OF their efforts.
The movements of certain stocks were
made to look encouraging. Among these
were American Locomotive, Studebaker,
scme OF the tobacco stocks, United
States Steel, &c. Against this, however.
was persistent pressure against many
others which are regarded as more or
less important in defining the trend.
The selling of Mldvale and Republic,
both OF which broke sharply. was q
natural development following the an
nouncement of the abandonment of
merger plans. The announcement not
having been made until the market had
closed on Thursday, those not on the
inside of the deal were unable to get
out of their sticks in advance Of the
information becoming public.
The question Of the immediate out
look for the railroads Is one which Is
receiving more and more consideration.
The August reports now becoming pub
lie are not good. That. however, was a
development which was foreseen and
can be done in the remaining four
months. There Is no doubt that with
the big expansion in business already
accomplished and in progress the tom
mage which the carriers will be called
upon to handle will be huge. Gross
revenues, therefore, will be exceedingly
high. 1t is the question: of expendi-
sares. however, which makes for
uncertainty. Maintenance charges will
undoubtedly be very high. for the roads
equipment during the shipments strike
was allowed to run into bad condition.
The policy Of the roads with reference
to the manner Of charging off strike ex.
penses. too, will prove an important item.
So far there has been nothing to indi-
cate whether a major portion of these
expenses We're charged out of August
earnings or whether they were pro-
rated over the rest of the year. Pre-
liininary estimates OF August earnings
vary greatly, but net of $40. .000,00 to
S45,000,0 900 is regarded as O liberal fore
cast. For the year the carriers prob
ably will show net earnings between
$S00,000.000 and $500. 100000, which
while materially below the figure neces-
sary to carry per cent. on valuations,
are still substantially above last years
net.
The movement OF exchange rates yes-
terday was erratic. Sterling broke
sharply on publication of early disturb
ing news from Turkey. but recovered
in remarkable fashion before the close.
At the same time other rates held more
or less firm around Thursdays figures.
Bankers say that for the time being
there is little Of the speculative element
at work in exchange and that the bulk
of fluctuations Is caused by commercial
bills. This, no doubt, tends to promote
the movement downward. for with
speculative operations at work in the
market the buying of sterling at this
level probably would be larger than 1t Is
at present.
Call money showed no disposition to
ease Yesterday, and after loans were
made an day at AZ per cent. a sudden
demand in the late trading advanced the
rate to 5 per cent