Evening star., 1926-10-31
INTEREST CENTERS
a.
/. IN FOREIGN BONDS
Record Breaking Trading in
Dollar Issues 0warfs
Other transactions.
BY BYRON SELLER.

w 1oGth- SCIOD6E Ad0hiG
of record breaking volume in foreign
dollar bonds dwarfed all other devel-
Dpments Of the week in the invest
E~ment market. ,e ------
- On Thursday the turnover in for
=zeign bonds amounted to over S7,000,-
300 psrsvalue and was the largest in
--5he history OF the New York Stock
Exchange. The activity was accom-
panied by the sharpest advance in
prices for certain issues made at any
lime this year
- This remarkable demonstration fol,
lowed the surprisingly large over
Subscription to the new Belgian
-stabilization loan earlier in the week.
--Coincident with the announcement
that the Belgian franc had been sta
--bilized on gold basis. an interna-
which was offered in the New York
market. The new bonds carried 7
per cent coupons and were priced at
"a, to yield $50 per cent. UD to a
few days before the new bonds were
offered the old Belgian IS had been
selling on a slightly lower basis than
TN per cent and the first effect then
was to bring about decline of point
Or SO in the outstanding issue. to
bring them into line with the new.
Bankers Were Surprised.
- But when the new Is We're offered
For subscription the response sur
@prised even the bankers. Orders
poured in from all over the country,
and never after trading In them was
Begun on the exchange did they sell
1T the offering price. In az hours
premium Of more than 2l2 points
was paid. This set the stage for the
gpectacular display in all the higher
Yielding foreign issues which was to
Follow.
- When one of the most prominent
bankers in the country expressed the
-epinion publicly that France and Italy
would soon follow Pelgium in the
Restoration Of the gold standard. or
rather in the stahiliZation OF their
c,rrencies on sold basis. his words
fell on fertile ground. Interest shift
--ed from Belgium to French obliga-
lions. Gradually they. too, began
to creep up, and during the last hour
of Thursdays session the volume of
trading swelled until it broke all rec
ords. and prices advanced all along
the line. Before the close Of the
week French Is had sold higher than
at any other time in their history,
French IS and French 71ss had made
new records for the year, and French
municipal, provincial and industrial
descriptions had gone along with the
rest. .-.'
italian Bonds Attracted.
- Even the Italian bonds usually
Sluggish. were taken up and carried
into higher ground. 1t may or may
not be significant that South Amer
lean bonds did not share in the favor
extended to the European part of the
fist.
= It is hard to explain the sudden
awakening of interest in foreign dol
lar bonds. Part of it may have been
die to the continued advance of do
mestfc issues. with the consequent
lowering of Yields, thereby divertins
attention of investors to the more at.
tractivelv priced foreign descriptions.
Part of 1t may have been due to the
conviction that financially speaking,
affairs on the other side have taken
turn for the better and that the
Belgian stabilization step was indeed
a rorerunner of similar movement
IN France and Italy. AS far as
France is concerned. Paris cables did
not encourage this idea.
- " hateVer the real reason there
was no denying the fact, and this not
Wlthstanding that quotations were
shaded from the high points under
the customary prof1t-taking sales. 1t
as interesting, too, to note that ad.
justment of the war debts OF these
tSo " tic OIllSu STATES Gov
ernment was not a factor; otherwise
French bonds would not have taken
the conspicuous part in the movement
they did.
Domestic Issues Strong.
Had it not been for this activity at
rising prices in foreign loans the
week would have been notable for the
sustained strength in domestic invest.
ments. More and more il became
clear that buyers had no concern over
the money outlook and that the mar
ket for the most conservative cor
porate obligations was in better sha ne
tnan at any time since early Summer
The surprising thing about this de-
mand for seasoned issues is that II
came in the same week that new bond
cnerings were the largest in more
than four months. Altogether it was
impressive evidence Of the abundance
OF investment capital seeking en-
pfoyment.
As far as new issues were con.
cerned, Offering prices were more
nearly In line with the market than
Tor long time past. Investment
nenkers seemed to have modified their
IDEAS and as result the placing Of
this weeks new bonds was unusuallv
good Or course, that is a situation
"nlch can change very rapidly
Another investment event of more
man ordinary significance was the
raising this week Of the dividend on
PENNSYLVANIA. Railroad stock from 6
to per cont Because Of the wide
distribution Of its shares, there was
g. countrywide interest in the an.
rtuuncement. More important, how
eyer, was the deduction that can be
fairly drawn that, in the opinion of
the directors OF this great corpora.
dorl. there is nothing to fear about
the business outlook.
1T may also he regarded as express
Stve OF confidence in the political sit.
ustion. More than one hoard Of rail.
road directors has teen suspected of
hesitating about di$bursing to stock
holders their fair share of the profits
from operation lost this exhibition OF
prosperity should arouse political an
tagonism.
= EXTRA DIVIDEND SEEN.
NEW YORK. October 80 R.-
Speculative possibility Of an extra
vdfyidend on the common stock of the