Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-06-18
LOCAL BROKER SEES.
SELECTVE MARKET
Chapman Expects Group
Moves Rather Than General
Break at Present.
BY EDWARD C. STONE.


AS the first six months of the year
are drawing to a close local investors
and spectators are trying hard 10
visualize the future of securities on
the New York Stock Exchange. In
everyboardroom in Washington one
hears a great deal about double tops,
rich mems markets." steady declines
and wild breaks, and guesses as to how
long cheap money will be the leading
factor in keeping prices up. More
over, all these discussions always come
around to the greatest question or all
the possibility of a bear market that
might wipe out countless traders ana
last for many months. OF course,
nobody knows what New York socks
will do next. or this would be a world
of multi-millionaires, but closeup
views do show certain trends that are
only partially changed by manipula-
ton.
George B. Chapman. resident partner
of Hartman & Co, who has been In
the brokerage business more than 20
years, is among the financiers who
does not believe there will be any
sweeping reaction in the stock market
at present unless there should be some
very sudden and serious change in con-
ditions. He calls attention to the fact
long and severe setbacks and consid-
ers that market activities during the
last half of the year are more likely
70 be by groups than any general
movement that would carry all stocks
lower.
Market Methods Have Changed.
much comment is heard about the
increase in loans," says Mr.. Chapman,
"and this increase has, indeed, been
remarkable but not so amazing as the
number of new securities that have
been issued. There is no reason why
the loans should be considered other
than as they bear on the security
market in general
"The difficulty in deciding how to
analyze the market is due largely to
the fact that the old method of buying
and selling the marekt as a whole Is
no longer possible. We have had in
the past six months decline in the
oils, rubber, wooden and copper stocks,
as we'll as in other securities, too
many to mention, and there has been
q legitimate reason for such decline.
During this period of decline there has
been an advance in a number of the
motors and in the railroad securities,
which has also been perfectly legiti-
mate and logical.
I'm investing in the market, one
should analyZe the industry in which
he is investing. The probabilities are
that, when the railroads have seen
their high. and the motors, too, there
will be a decline in these securities.
during which decline the oils, rubbers
and coppers will probably adjust them
selves, and we will then see an adj.
vance in these securities
Would Study Each Industry.
'"There is still ahead of the public
utilities and electrical industry an
enormous growth. New uses of cleo
tricity are becoming more apparent
each day. Electrical refrigeration
alone will more than make up the
loss of current that has come from
the lessening of electricity for lighting
purposes during the Summer period.
And then the food stocks, securities
dealing in the necessities Of life, have
"a long period of prosperity ahead of
them, and are stabilized in their earn.
ings.
THE United States and the world at
large are improving and becoming
more stabilized. This in itself should
tend to improve the shipping and ma
rine shares. There has been a marked
improvement in this industry, and
there is no reason why it should not
continue.
'Since it is impossible to buy or sell
the market as whole, the only cor
rect way to speculate successfully is
to analyze the security and industry in
which one is interested. If you find it
is improving and the outlook for the
future favorable, buy that security.
If, on the other hand, you find an in.
dustry is not keeping up, and there is
u slackening in that particular bust
ness. then sell that security.