Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-26
STOCK PRICES DROP
IN CREDIT SQUEEZE
Further Advance in Money
Rate Forces Fresh De-
cline in Market.
BY GEORGE T. HUGHES.

Special Dispatch to The Star.
NEW YORK, March 26.-Fresh liqui-
dation forced and voluntary, swept over
the stock market again today in huge
volume.
Prices broke through yesterdays lows
and carried the whole list down. The
pressure was steady and relentless and
every attempt to rally the list only
brought out new offerings.
At the start there was a feeble re-
covery from the preceding close. Some
buying was based on the theory that
after so violent break as that of yes
terday-coming as it did on top of
downward trend last week-a recovery,
temporary at least, was in order. Then,
too, there was a certain amount of short
covering, taking of profits by those who
had sold for the decline.
Money Rates Advanced.
This support, however, was inadequate
to stem the selling tide. In some cases
quotations gave way slowly and there
were few wide-open declines, and yet the
trend was so unmistakable that not only
did the pools stand aside, but new buy
ers decided to hold of.
1t was the stringent credit situation
that frightened spectators. Call money
renewed at IL per cent, rate I'M
equaled for renewals since January 2.
Even at this hgure the demand exceeded
the supply and at noon the price
jumped to II per cent, at which tate
some loans had been made in the out
side market during the morning.
The question was how high the banks
would let the rate go before coming to
the relief of the market. 1t was all too
plain that the admonitionS Of the
Federal Reserve to cut down on the
amount of funds for speculative use
we're being needed.
In one respect the market was similar
to that of yesterday. Except among a
few high-priced specialties, losses were
never large between sales but the prog
ress was steadily toward lower levels.
It was the kind Of market that made
those still long of stocks on margin
excessively nervous.
Before noon standard stocks. issues of
undoubted investment merit, were under
the low of Yesterday. Included In this
list were United States Steel, General
Motors, Anaconda, Kennecott, Johns
Manville, Chrysler, National Cash
Register and Columbia Graphophone.
Some of them we're weaker than the
others but none established resist
ance point.
The copper stocks were pressed for
sale regardless of the favorable trade
situation. But Wall Street was giving
no heed today to business outlook or to
anything other than the tape itself,
and that was rejecting the overbought
condition and the squeeze in money.
The copper stocks had attracted large
outside following because of their bril-
liant prospects. Evidently margins were
being impaired and something had to be
sacrificed. It Is the rule in the first
stages Of decline that the good stocks
are thrown overheard first, and that
was what happened yesterday and toz
day.
Volume Gains on Decline.
Measured by the highs of the year,
the losses were extremely large. Ana
conda, for instance, below $50. was on
more than IS points from the best Of
1929. Chyrsler. under 81. was down 80
points from the years top. Montgomery
Ward, below 1l8, was of some SO points.
OF course the losses from the preceding
close were much less. but the figures
given show that considerable correction
has already been effected.
It was significant that volume today
exceeded yesterday. as large as that
days turnover was Up to noon trans
actions today totaled 1889. 400 shares,
compared with 1,814,600 shares at the
same hour yesterday. This increase of
volume on the decline was one Of the
most disquieting features of the trading.