Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-03-27
H|GH-GRADE BONDS
FIRM DURING WEEK
Interest Turns From Govern
ll1ent Issues to Other First
class Obligations.

Special Dispatch to The star.
NEW YORK. March 26.-The bond
market this week continued to respond
TO the tonic influence of recent Treas
ury financing. II was characterized
by an extensive shifting of invest
nlent interest from United States Gov
eminent bonds into other types OF
high-grade securities.
That shifting of interest was
logical outcome of the sensatonal ao-
vance In prices of Government bonds.
while the Treasury Department eS-
change offer was still open. AS an
outcome of that advance, the norman
spread between those bonds ana the
high-grade corporation and other gilt
edged securities had widened until the
yield on the latter had begun to look
very attractive to investors compared
with that obtainable from Govern
ment securities.
The buying of bonds of the best
grades was spirited at times. 1t en-
braced the most desirable railroad,
public utility and industrial bonds,
especially bonds legal for savings
banks. II also included muntcipai and
State issues. Perhaps the outstanding
development was the sale OF Atcnison,
Tnneka & Santa Fe Railroad general
As. the standard bond for savings
banks. at a price TO yield less IMAM
AGO per cent Many other leSals sofa
on 400 per cent basis.
Advanced Easily
II was observed that the high grade
issues advanced substantial fractions
mn f'he purchase of a few bonds Inc
market was not active, there We're
insufficient bonds of the types most
desired TO create activity. Among the
either first-ciass bonds which erept
higher were Great Northern 412s,
I'hesa peake & Ohio refunding os, lnl-
nois Central refunding IS and West
ern Union AIS.
Some Of the less highly rated bonds
were in demand for specific reasons.
Anaconda Copper depenture nonds
were bought because of rumors that
the company will refund them into
a new issue bearing a lower coupon
rate The debentures are 7 per cent
issue. Some of the speculative rail-
road issues, such as the Chicago. Mil
waukee & st. Paul junior obligations
were bid up, but the market in them
WAS not very active. Foreign bonds
were strong, several new high rec
ords being made.
The market for United States Gov
eminent obligations was irregular.
The rush for them is over, readtust
nents of position having been COM
pleted for the time being, and prices
!. in consequence were a little lower.
A good trade was done over the
counter in the various issues of Lib.
erty and Treasury bonds. Publica-
ton Of the exact amount Of CONVEX
sions Of Liberty second ANS into the
new Treasury 80 per cent notes was
without market effect. The amount.
given as 1854 GIL $50, was quite close
TO Wall Street estimates The main
interest now is in what disposition
Secretary Mellon will make of the I'M
converted second 4 las, aggregating
about $1,000. 100000.
May CaiI Second Liberties.
It is the opinion of some high bank
authorities that Mr.. Mellon will call
the entire unconverted portion of the
second Liberty ~ per cent loan for
redemption November IS. Such
program would call for another re.
funding issue some time prior to that
Over the counter dealings i'm mu.
nicipal and State bonds were active
this week, There is no question that
mundcirals benefited proportionately
more than any other type Of bonds by
the Governments recent finaneinr
The market In them had been DRAG.
ging for some time and many dealers
were hung up with State and raunic-
ipals they could not dispose Of. When
Dir. Mellon announced his plan there
was big rush on the part OF certain
large investors to get out Of Govern
ment bonds and into municipals and
State bonds, because of the more at
tractfve yield.
While in point of volume new
financing was not large. 1t developed
some interesting features. An issue
Of $4,000 900 Chicago, Burlington &
Quincy Railroad first and refunding
mortgage Al per cent bonds was sold
ct 81 to yield ass per cent If held to
maturity. The bonds are not legal
for savings banks. Had they been
they could have been sold on about q
40 per cent basis.
A City of Toxic issue of $40. $40 ,00e
51z per cent bonds, offered at ssIs 10
yield 8 Il per cent. was oyersubseY1bed.
The bonds are caliable by lot at par
every year and, therefore, were in de-
mand because of the speculative at.
traction.
The Interstate Commerce Commits
sion appears to be winning its fights
10 compel railroads to sell equipment
trust certificates on a competitive
basis. Bankers recently bought an is
sue Of $9,T5o,000 Baltimore & Ohio
car trust certificates In competition
and resold them to the public on q