Evening star. [volume] (Washington, D.C.) 1854-1972, 1923-05-18
VIOLENT DECLINES
| IN SPECIAL STOCKS
Fertilizer Issues Display Spe.
/, ciaI WeaknesS-Late At
4 tack on Leathers.
BY STUART p. WEST.

special dispatch TO Inc Stdr
NEW YORK, May 1S.-Another very
bad smash in the shares of chemical.
fertilizer and cotton oil companies
was the main incident in the stoc1
market today. This was accompanied
b. similar collapse in their bonds.
So much has been said regarding
The reasons for the weakness in this
group of securities that 1t only re-
mains to summarize previous state
ments. The panicky selling in some
OF these cases might we'll suggest the
fear of receiverships. but it has been
thought likely that the situation will
be met by thorough oyerhauling Of
capital accounts.
With American Cotton Oil any such
readjustment would probably involve
provision for the $S.500,000 notes ma
turing in September, 1924. The prin-
cipal reason for cutting down CAPT
talizatton is the need of adjusting 1t
to what appears to be permanently
reduced income.
Poor Business Reported.
The fertilizer and cottonseed oil
companies, according to reliable in
formation, are still losing money, and
will soon be issuing some very bad
y
1922. Companies interested in the
manufacture Of cotton oil were hit
by the rise in cottonseed prices. while
the fertilizer end of the business has
been undergoing a severe competition
which has forced prices down to an
Improbable level
There was little connection be-
tween such stocks as Allied Chemical
and Dawson Chemical. on the one
hand. and American Agricultural
Chemical. Virginia Chemical and In
ternational Agricultural Chemical on
the other But the bear party in
search for vulnerable spots picked
the former out because they often
move in sympathy with the fertilizer
group.
Other Stocks Pounded Down.
At the same time much was made
about the recent decline in farm
prices as injuring the prospects of all
companies doing business with the
farmers. This established a connec-
ton between the fertilizer issues and
other farm supply stocks like Inter
national Harvester. Montgomery
Ward and Sears Roebuck. all of which
We're driven down sharply.
The decline in the chemical stocks
was finally checked in the early
afternoon.
The bear traders turned their at
tentfon to the leather shares. Cen
trail Leather was pushed below 90
and Hide and Leather preferred was
driven down under so. for no reason
except the pretense that the leather
industry was not getting on as well
as expected. Pacific Oil was weak,
the street not liking the postpone
ment of dividend action until Mon
day. Standard Oil of New Jersey and
Standard Oil of California were un-
der pressure because OF the effect
which heavineSs in this particular
group of stocks would be likely to
have upon sentiment.
Bears Renew Attacks.
The operations Of the last hour
were simply determined effort by
the bear party to start the market
going down again through developing
individual weak spots. In this they
did not attain much success. Prices
came down from the highs of the
forenoon, but in the greater part of
the list stout resistance was encoun-
tered on such reaction as occurred.
Although international Harvester
sold at a new low for 1923 today.
neither the action of the stock nor
the position of the company itself can
be regarded as comparable with the
which recently has been conspicu-
ously weak. Harvester'S business is
done with the producers of agricul-
ture products. but it is more wide
spread and more diversified than the
fertilizer or cotton seed oil business.
Buying went on in Reynolds Tobac-
co for essentially the same reasons
that have been behind the strength
in this stock all along, namely, an
especially good financial position, fav
orable earnings and the expectation
that shareholders will receive high
er amount in dividends during 1928.
Review and Outlook.
Wall streets markets of today were
Interesting chiefly for the way they
stood up in face of the widespread
campaign originating in speculative
quarters. the object of which has been
to brighten investors into selling by
talk of an impending business de-
preston.
There were three specific incidents
that stood out in what otherwise
was a dull and uninteresting day
The first was bad break in the
bonds and stocks of companies de-
pending for patronage upon the farm
population. The second was a turn
for the better in copper shares. The
third was an improved demand for
sugar stocks.
The interesting feature of the day
in the foreign exchange market was
the weakness In German marks.
which got down approximately to :he
January low, which was the lowest
of all times.
MARKET CLOSES HEAVY.