Evening star., 1924-04-03
VARIANCE IN GROUP
PRICE MOVEMENTS.
Railways and Industrials
Strongly Diverge-Gains
and Losses AnaIyzed.
By STUART II. WEST.
,nAcial nisnatch to The Star

Special Dispatch to The Star.
NEW YORK, April 3.--In today s
stock market there was an extraordl-
nary divergence in tho price move
rnent between railway stocks and IN
dustrials The former were at times
very strong, the latter, with some e&-
ceptions, were either heavy or dis
tincuy weak. One theory was that
the rails were being put up in order
to make it easier to sell the indus
trials. Another theory was that IN
terest was merely being transferred
from the one group to the other. in
volving simultaneous purchase of the
rails and selling of the industrials.
Southern Pacific n Factor.
Southern Pacific, which for a long
time past had been hanging discour-
asingly around Sc, started up in the
last hour OF Wednesdays trading.
Tho buying was resumed at the out
set today and it was the rise in this
stock across 90 that started things
going in the railway section general
". Southern Pacific directors meet
on May 10 to act on the dividend, and
while talk of an increase could not
be dignitied as anything more than
rumor, such talk was heard again
around the street. Another eXplana-
tion was that Southern Pacific has
been held down unnaturally by the
selling out of the remnant of British
government holdings used Us col
lateral for the old war loans.
Union Pacific was quick to fall
into line with Southern Pacific. Here
the incentive was the high interest
return. AtchiSou directors have only
just declared the regular dividend at
the rate of per cent. thereby dis
posing for another three months Of
reports of an increase; the stock
went up with the others, getting well
across par New York Central was
bid up above 101. also on the arg-u-
ment of the investment yield.
Low-Priced Rails Sought.
Low-priced rails came in for as
much attention as the dividend pay
ers. Erie crossed 26 on large trans
actions.
Texas and Pacific rose sharply,
Rock Island issues were strong on
better appreciation of the fact that in
the single month OF February the
earnings increase amounted to the
equivalent of 212 per cent on the com
mon stock. Missouri Pacific prefer
red. which with anything like a nor
NAL maintenance account could easily
pay dividend, made new high rec
While the rails were going up the
leaders in the steel, equipment and
motor group were coming down. De-
spite all the reassuring statements
from trade centerS, the street cannot
get rid of the preston which il has
had for the last several weeks, that
the automobile industry is faced with
period of overproduction. All the
more prominent motor stocks, like
Studebaker, Chandler, the Pierce-Ar-
rows and Willys-Overland preferred,
were under pressure.
Situation Held Logical.
The partial diversion of interest
from industrial to railway stocks was
logical enough. 1t took account, on
the one hand. of the uncertain out
look in q number of important manu-
featuring lines. and on the other hand
of the favorable conditions surround
ing the railroads Of the country re-
1ected in the weekly tonnage figures
and the February operating results.
The one thing which has held back
both investment and speculation in
railway stocks has been the fear of
legislation that would lead to rate
reduction. This fear now has been
eliminated SO far as the present ses-
sion of Congress is concerned. The
remaining two months will be crowd
ed too full with other measures for
any railway bill to stand chance.