Evening star., 1924-08-11
RAILROAD SHARES
IN / SHARP. 4 }. ADVANCE
Motors, Oils and SteeIs Are
Weak-SeIIing in In
dustriaIS.
BY STUART p. WEST.
Special DISPATCH to The star

:. BY STUART p. WEST.
Special Dispatch to The Star.
NEW YORK. August 11-Strength ir
the railway shares, which was the prin.
cipal feature of the market today. was
due mainly to money conditions. The
buying was based upon comparatively
high return on the standard divi-
dend-paying rails in view Of the very
low return upon money. Even around
.13o, where 1t was up ? points from a
week. ago. Delaware and Hudson was
still affording return of 6A per cent
and Unipn Pacific. at new high around
145. Was selling to yield close to pei
cent" New York Central above 10S was
still on a 6 y per cent basis, and South
ern Pacific around SO was promising a
yield Of over 6A per cent
On the other hand. the money ques.
tion did not enter into the rise ir
stocks like D. l.. and w, Atlantic
Coast Line, L. and n. and AtchIson
so much as the prospect of dividend
increases Another stock distribu-
tion by the end of the year is looked
for on d. l.. and W. The rise in l.
and n. above par for the first time
and the new high record in Atlantic
Coast Line bore out the impression
which Wall Street has had for some
time that larger dividends are in
store for these companies.
L6w-Priced Rails Deserted.
AS a rule, low priced rails were
no longer as popular. The action Of
Erie common, which sold below 3
and was off nearly 5 points from
its top. was evidently casting some
thing: of. a .cirifl upon speculative en-
thSsiasm regarding the market eff
feat ilxrro ~
strength of st. Paul preferred brought
out a report that new buying wa:
coming into the property, but thi.
was hardly more than speculative
gossip.
1t was quite evident that advan.
tage was being taken of the strength
in rails to distribute some of the
industrial shares.
Transfer of funds from New Yorl
to London as discount rates have gon,
down has been responsible for much
of the buying Of sterling drafts re.
Gently going on. The stock marke
of the day had good deal to sa,
upon the subject|of European recon
struction and. Of how. the advance il
the exchanges would react upon Eu
ropes ability to buy American goods
This may have been a good enough
of copper companies and others mos
interested in the development of the
foreign trade. But it did not Civ,
proper appreciation to the obstacle:
which will still stand in the way O.
European recuperation, even if the
reparationS problem is settled, the
Ruhr evacuated and the Dawes plar
put into effect
Motors and nile u.,xx
Steel common was heavily solo
after having touched 10s1s at the
start. Bethlehem Steel fell back
similarly after an early rally. Equip
ment shares likewise failed to hold
gains made at the outset. The mo.
tors were heavy and the oils were
offered down following the announce.
ment of further price cuts in the
Southwest. The Street was mot sur
prised at the passing of the dividend
on Atlantic Refining which became
known after the close of business
Saturday. But it had not looked fol-
the omission of the dividend or
Standard Oil of Kansas. Atlantic
Refining stock had another sharp
break.
Recent buying of Texas and Pacific
has been attributed te merger pros.
poets, but aside from these company
earnings were such as to justify current
selling prices in the opinion of the
Street. Where most other roads were
reporting losses in June, Texas and
Pacific gained over last" year. On
the basis of the new capitalization
under the plan of reorganization
Texas and Pacific earned 5.63 per cent
on the stock last year. and is earn
ing at the rate of 71s per cent now
General Electric Thrown Over.
The weak kness in General Electric
was very apparent-.eve while the
general market was displaying its
greatest strength. This suggested
selling of special character, and the
gossip was recalled that a prominen,
professional operator has been credit
ed with being heavily long of Cen
eral Electric, while last spring TAX
ing a -bearish position on other
things. The idea was that the oper-
ator in question had concluded that
it was time to draw his General Elec-
trio profits.
General Baking shares, which had
risen points last week, had another
spectacular run-up. Around 125 the
stock was quite out of line with the
present dividend, which is only IS. In
1923 earnings on the common shares
amounted to s11.25, but owing to the
fact that .the company had on hand a
lot of low priced flour and will have
benefited greatly by the rise in flour
prices, this years earnings are ex-
pected to be very much larger. In
1922 stock dividend of. 200 per cent
was paid.
Railway shares made their highs in
the last hour. New York Central sold
at 109 for the first time and Atchison
at 1O6 was within a point of it's top.
Sugar stocks were helped by indica-
tions that sugar prices were gradu-
ally drawing away from their low
levels.