The New York herald., 1922-06-23
MEX XPETEUP TO186
ASSTOCK EXCHANGE
HUNTS FOR CORNER
Brokers Requested to Tell
Their Position at Close
of Trading.
UP SO POINTS IN 6 DAYS
Only About 100000 Shares
in Hands of Public for
Speculation.
INVESTIGATION IS SECOND
Fluctuations Looked Into
Last Year, but More Thor
oughness Is Promised Now.

Authorities of tie New YORK Stock
Exchange have ordered an investiga-
ton into the extraordinary fluctua-
tions of the price of Mexican Petro-
leum stock in the last six days when
it has advanced about flfty-three
points in violent trading.
Brokers who are familiar with the
being handled said yesterday that
there is no doubt that corner is
being prepared. and that unless the
Stock Exchange takes prompt hold
and begins thorough investigation a
scandal will develop and involve many
big houses
The committee on business conduct
of the exchange in the day sent let
ter to all members requesting their
position in Mexican Petroleum at the
close of tie days business.
Break May Come To-day.
This is the second investigation OF
Mexican Petroleum ordered by the New
York Stock Exchange within year.
and indications were that the now one
would uncover many more faults than
did the last.
Brokers said the stock was being
manipulated in flagrant violation of tho
rules Of the Stock Exchange and many
of them predicted that the announce
ment of the proposed investigation
would cause break in the corner this
morning.
There are only about 10000 shares of
the common stock OF the company avail
able. but these have been banded about
right and left for almost week. The
daily turnover is more than the num-
Der of shares available for legitimate
trading.
Last year when the stock was break
ing daily from five to ten points more
than the amount of avilable stock for
trading was dealt in at each session.
The trading for the last six days has
been exceptionally violent. the stock
touching 1856 yesterday, the highest price
OF the year and gain for the day of
IL points. The record for the last week
shows some remarkable daily gains. as
follows: Wednesday. 5ls points; Tues
day. 9ls points; Monday. 14h points;
Saturday. 2h points. and Friday. Sh
points.
Extensive short Interest.
The present advance in the stock ac-
tually started last Friday at 1891. The
low price for the year to date is 106%.
Mexican Petroleums position In the mar
ket has been the subject of discussion
In Wall Street for some time. 1t was
known that an extensive short interest
existed In the stock. The action of the
stock In the last few days. advancing
violently under the most urgent bid
ding, has shown plainly that some large
shorts had been caught and that they
we're finding 1t difficult to cover. Sew
eral months ago short selling OF Mexican
Petroleum was encouraged by rumors
that the company's wells in Mexico were
filling up with salt water.
Such rapid advances in Mexican Petro-
leum as have frequently occcrred are
aided by the small floating supply OF
the stock in Wall Street. The company's
common stock amounts to only little
more than 100000 shares. of which more
than $4,000 shares. or 1885 per cent.
are owned by the Pan-Amertcan Petro-
leum and Transport Company and the
Huasteca Petroleum Company Tha'
leaves only about 100000 shares Of tho
stock in the hands OF the public and In
brokerage house speculative accounts
and Il is generally believed that large
part OF that amount Is closely teld. Since
the advance In Mexican Petroleum start
cd last Friday 392.7oo shares of the
stock have been traded in on the New
York Stock Exchange.
In the balance sheet OF tie Pan
American Petroleum Company as Of
December 81 last the company's hold
ings Of Mexican Petroleum stock are
carried at 800 a share. At the market
price for Mexican Petroleum the stock
Is s6 points above the price at which the
Pan American company carries It's In
vestment, OF a s2e,741.s $50 market appre-
citation over book worth. Additional
purchases OF Mexican Petroleum were
made by the Huasteca Petroleum COM
pany in June and July OF last year at
an average price of s14s a share.