Evening star., 1926-02-07
BUYING IN FOREIGN
BONDS VERY HEAVY
High Yield Makes Strong Ap'
peal-Sugar Liens Come
to Front.
GEORGE T. HUGHES
Snectal Dispatch TO The Star.

Srecfa1 Dispatch TO The Star.
NEW YORK, February 6.-Agair
Shts week the average price OF in
YeStnent bonds has reached a new
high mark, the highest since 1917
The movement has been continua
Son of that in progress since the frs
pf the year and the underlying
causes are the same, namely. sur
plus of capital seeking employment
and demand for seasoned issues II
excess of the supply.
The feature of the week, however
has not been so much the inquiry
for domestic bonds as the buying o
foreign issues which are now also a
q high point since the war. Buyiht
in this group has been gong OF
quietly for d long time. but II was
only very recently that the effec'
showed in the quotations.
Higher Yield Appeals.
of course, the attraction foreign
securities offer is the higher average
yield they afford as compared VIII
domestic issues And as slowing Ad
yaucingr prices for domestic bont>
reduced the opportunities in that
part of the list, il was natural tha'
investors. traders and spectators
should turn to foreign offerings.
The issues which have bed the mar
ket were for the most part well sea
soned and not those newly marketed.
Much recent foreign financing mas
been done on a favorable Weld OASIS
and the security mas seemed ahipie'
but there is this distinction between
the new and the old, namely. thdl
practically all new foreign bonus
.YIf.
redenlption at prices only 4 httle
above the market. whereas there are
many older descriptions which nave
.,riU 4 long way to 20 beior" they
reach the point at Which they are
callablc. This Is 4 technical natter:
hut 1t bulks large in the eyes OF
traders who feel that II they taks
the risk inherent in these hi@I yI"it,
ing foreign securities they shout!
have corresponding POSSIBILITIES o.
profit.
Foreign Bonds Status.
THAT this factor is important ~
+he market can be illustrated oH
connparins two CZechoslovak bohds.
although i'll this case II Is the new ~
issue which has the stronger teen
rical position CZechosIoYak ~ are
rauabIe for the sinking fund al par
while the similar prIre Tor re LEc''@, ;s
sIoyak 7las is 1o5. The result Is
Not at rba market price this week
tho n per cent bonds were on u
lover Welding basis than the s.. al
though the security - lp' ''''
rica1 purposes aS good LOT "''e
the other.
There are only q few entirely non
ca11arIe foreign bonds ana pra''lcS'-iE
none were put out in the last Neir oL W
~ The minority includes three or
[o,,r trrench issues which 49," IN a
80 nv themselves and viii y" until
there is some sign Of clearing ", J.,
The French financial situation. W III
these tNc5ltli,I1 7 ,t';,lI he fact that if and
,r,ban conditions improve abroad thel
holdings are sure tu ~ rTtrtd. IA
t1,e case of the obligations "I me
%or-I, F,urorean countries ueuiraiS IN
The waf.. much Of this refuudin& mas
already heen done.
,oin uigbsr
i'i''''''' ...
Coming back 20 Hoi'.'9'i. -.
ments. the week mas Witnessed -
high prices tor one OF mo-! VI ~
United states 'r'~t 'iiIie''' -A,''
this was on bank buyihS.
Attention of lndlNldudt lINeStoi
was Centered on higher EieiuiHS
CuritieS, those IaHnli@ ~
below the socalled legal CLASS; ~
derlying bonds such as savings "a''hS "a''hS
buy are so difficult 10 OBTAIN III >''!H
sizeable blocks that the hlaihe' -
more or less nominal.
But when 1t comes 10 SrtoA" St"U'
the semi-speculatiVe descriptions Win
Yields around per cent OF DETER
the market has been both actlNe anu
strong. What buvers have been look
ing for is combination OF liberal re re-
turn and an improving "ut'o"h TOT s Iile
debtor corporation. theF louI'| 'L3
this week in some or the steer "o'''S
and striktngly 50 IN the sugars
S,,cror ions Active