The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1929-08-09
SHARP REACTION ON
new YORK MARKET
FOLLOWS new RATE
Increase Catches Wall Street
Completely by Surprise; Try
to Save Themselves
BIG PURCHASES ARE FUTILE
Confidence Is Undermined by
Second Reaction Of Day;
Tendency Is Lower
BIG PURCHASES ARE FUTILE

New York. Aug. 9.-F1-The federal
reserves latest thrust at securities
speculation-an increase from S to &
per cent In the New York bank rate
brought about one of the sharpest re-
actions toda... in the history Of the
New York stock exchange. Prices of
leading stocks broke 5 to nearly 80
points in the public's mad scramble
to get out of the market. with indica-
tions that the days sales would run
around 1000, 900 shares.
The increase in the rate. which CO.
incided with a gain of $50, 900. 900 in
federal reserve brokers' loans to a
new high record above 81 5000. 900 900,
caught Wall street completely by sur
prise.
There had been a rather general
feeling in the financial district that
an increase in the federal reserve
rate, previously characterized as 1.-The
last resort" of the federal reserve
board by Chairman Young. would be
preceded by a higher rate by the
Bank Of England. Consequently, when
the London rate Was announced as
unchanged yesterday, no increase was
looked for here.
Blocks of 5000 to Is, 900 shares
changed hands at frequent intervals
In the early trading, with initial de-
clineS In most issues ranging from 2
to II points. AS soon as the first furry
Of selling had subsidized, a brisk rally
developed. which sent several stocks
l to 10 points above their opening
quotations. The buying quickly dried
up, however, and a fresh wave of
liquidation swept oyer the market at
midday. which carried U. S. Steel
common. Westinghouse. Atchi5on. and
many other industrial and railroad
leaders below their opening quota
tons.
This secondary reaction under
mined speculative confidence.
The higher federal reserve rate
brought no immediate change in the
credit situation. Call money renewed
unchanged at 8 per cent, with time
money rates firm around 8 per cent
Auburn Auto suffered the largest
decline, breaking 26,; points. General
Electric dropped Is, international
0AIVCA lot, AIIIclICdI 4clcpIlUllc Id
and Atchison. Westinghouse Electric
American and Foreign Power, Allied
Chemical. American Can, American
Power and Light. and North American
Co. fell 10 to Is points.
Nearly two score others. including
Packard Motors. National Cash Reg
lister. Consolidated Gas, American To-
bacco issues. Montgomery Ward
American International, and New
York Central sold S to 10 points lower
U. S. Steel common opened at zig
rallied above PIT, and then fell back
to 2l4 for a loss of nearly Z points
Although rallies of 2 to Z points ap-
peared in the pivotal stocks In the
last hour. the gains were poorly held
and traders apparently utilized the
higher prices to market their hold
ings. General Electric was at its low
est In the final hour, off 20 points
and several other representative
shares showed losses of Z to II points
A block of 5000 shares of American
Telephone sold at 80 after the stock
had recovered from 266 to 2741.. The
close was weak. Sales Appropriated
5,l00, 900 shares.