The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1922-06-01
IRREGULAR PRICE
MOVEMENT COVERS
STOCK EXCHANGE
Conflicting Opinions on
Effect of Mergers Held
Responsible.

ing opinions on the real effect
two long awaited decisions of
Supreme -Cotrt and a merger
tobacco interests all occurring ovs
the holidays were interpreted g.
the somewhat irregular price
movement. not only Of the issues
directly concerned in these de-
velopments. but throughout the
list. Reading common sold OF at
the opening and pressure on this
stock. continped throughout the
day. a rejection OF the disappofnt-
ment Of many speculative holder
at the failure OF the Supreme Court
to modify the dissolution decrease
in favor OF the common share
holders. Southern Pacific opened
lower and sold on during the
morning. many holders being Of
the opinion that in giving IN the
Central Pacific the company would
suffer a loss Of net revenue Iarser
in proportion than the fixed charges
OF which Il would be relieved.
There was no unsnimity on this
point. however. and speculative
buying Of the issue brought about
a recovery later in the day. stinen-
ing Of money rates in the after
noon stimulated some selling ana
the general trend Of prices was
lower. The bond market was Arm
as to the eilt-edEed issues. hut
somewhat irregular as 70 the more
speculative issues. Money opened
at per cent. hut was advanced 90
AZ per cent shortly after noon
and to S per cent before the close.
Early Trade.
Early trading today was very
largely affected by. several de
veiopments announced since the
close OF trading on Monday. Fore
most among these factors were the
Supreme Courts decision In 'he
Reading case. the Tobacco-Prod-
ucts-Retail Stores merger. and the
decision in the Southern Pacific
case. which was announced so near
the close on Monday that few
traders had more than a fash IN
dicating that the decree would pro-
vide for separation OF the Central
Pacific Trading IN the issues
concerned IN these developments
largely monopolized the market
during the first hour and there was
some irreEularity IN other sections
Of the list. Commission houses
generally were advising their Gus
TONERS that a trading reaction was
due after the strength NJ the past
few DAYS. However. prices held NJ
well with special strength in some
Of the OIL issues and the sugar
stocks.
Decision In Reading Cas-.
The Supreme Courts decision N
the Reading case was n mast in
terest 20 traders and those who hs-
lieved the court would alter -rn
decree submitted to - IN such \
way as 70 exclude the preferred
stock holders from the distribution
Of the company's coal properties
were disappointed. The action -
the common stock. which opene1
or points from MONDAYS close.
reflected speculative selling ny
those who bought last week n the
belief that the common would nc
gwen = greater share in the pro
ceeds ~ the distribution than was
rrovidsd by the original form q
the decree. Both preferred issues
opened at higher prices although
beth crSoyed a substantial advan,e
last week.
No let-up Is apparent in the bet
ter demand for steel established
this spring. Production continues
at rate somewhat over % per
cent OF capacity and buying is SUI
fcient TO keep prices firm. The
trade is now waiting TO see what
the Steel Corporations prices for
third quarter will be No change
is expected. Fabricated steel buy
ing fell m materially during Nav.
hut railroad demand is. on the
other hand. quite well maintained.
As far as the reduction in rail-
road rates is concerned. the Iron
Age states that the trade j. dis
appointed at the size ~ the CIT.
steel makers find a certain amount
Of consolation. however. IN the
railroad wage reductions. figuring
that these will enable the carriers
to keep their purchasing power
intact.