Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-01-27
STOCK PRICE index
AT HIGHER LEVEL
Market Shows Signs of Re.
Covery From Secondary
Reaction.
Special Dispatch to The star.

NEW HAVEN, Conn.,, January a.
Rosy-fingered dawn of real recovery
from the gloom of the most pronounced
recession in its history seemed to break
on the stock market last week. Coupled
with the reaSsuring statements from the
White House about improved employ
ment conditions, as confirmed by Sec
rotary of Labor Davis, came the opti-
mistic statement by business leaders
comprising the executive committee Of
the Presidents business survey confer
ence. Along with these United States
Steel, bellweather of the market, gave
unmistakable symptoms of health in
bookings of new business. United
States Steel broke upward through IT'S
on Thursday and still higher Friday,
carrying with it ITS out of $40 stocks
in the largest single days rise since
December 81. Only As stocks fell, the
rest remaining steady.
The market rose to its highest point
since December IL. It is not signifi-
cant that it still had points to 90 on
its way to recovery to the peak since
the November break. The record of
last week, with its assurances that
business recession during the last
months OF 1929 left no major problems
to solve, indicates clearly that the mar
ket is now undergoing real conva-
lescence. Every group of stocks went
up last week, with the largest gains in
motors and with steels registering only
8 points below the peak since the break.
Foods are at the highest since January
IA. Coppers are up, although still be-
low the low point Of the primary break,
while rails rose on Friday to the high
est point since December 10.
Further Gains Seen.
The fact that the 2-point rise on
Friday was on the second 5000, 000-
share day this year revealed the in
herent trend Of the market. It Is still
a buyers, not traders, market. The
course Of its recovery must still seem
tedious to the banks, whose store of
frozen" credits still bears mute wit
ness TO the havoc wrought upon their
customers accounts by the October
November crash. Until the collateral
stocks absorbed by banks throughout
the country can be fed into the mar
ket in bulk the price level of common
shares will not begin to approach the
peak Of 1929. Recent symptoms of re-
covery are to be interpreted, therefore,
as signs that the secondary reaction
after the break has reached its end
and that gains hereafter viii be sub
Stantial.
These gains have already assured the
investing public that the new plateau
OF stock prices, still 80 per cent higher
after the November break than the level
of 1926 and 800 per cent higher than
the 1914 level, is still well planted on its
high foundation. Profits during 1929,
despite their falling off during the
l..
The processes by which they were
gained persist and are subject to still
further improvement and economies.
Enhancement Of security values may be
expected so long as business shows in
creased skills and aptitudeS.
The compact survey of New York
Stock Exchange movements of common
industrial shares is given below in price
indexes (1926 - 1000. There are two
indexes of market price movement. The
first c'shareS outStanding"). represents
all common industrial shares listed on
the exchange, the Importance of each
stock being considered according to the
shares in existence or outstanding.
The second index csc leaders") shows
the price movements of the common
industrial stocks most heavily dealt in
during the week, this list changing
weekly with the shifts in trading popu-
larity.
The "shares outstanding index
shows what substantially representa-
tive 500 worth of stocks In 1925 would
now amount to II held unchanged since
that year. The so leaders" index shows
the result Of reinvesting the 500 every
week in the market favorites of that
week.
The last column Of the table gives
the rate of return of the weeks so
leaders at current prices.