Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-04-20
ACTION Of STOCKS
I. IN WEEK REFLECTS
UNSETTLED TRADE
Some Groups Advance, but
Others React on UnfaVor-
able Developments.
CUT IN COPPER PRICE
STIMULATES PURCHASES
Wall Street Apparently Sees Gain
in Business, Although
Recovery Is Slow.
BY CHARLES F. SPEARE.

NEW YORK, April 19.-The net re-
suit of the week, during which there
has been considerable churning about
of stocks, is an average price slightly
lower than that of last Saturday.
Some of the special issues, particu-
larly among the industrails, have ad-
vanced above their previous levels. On
the other hand, it is significant that
there has been an increasing number
of stocks that have dropped into the
lowest area of the year, rejecting un-
satisfactory earnings for the March
quarter and Immediately unfavorable
prospects.
Along with the fiattening out of the
price average for equities" there has
been a definite and fairy pronounced
reaction in bonds, whose average today
is 134 points lower than a month ago.
This represents a fairly large slicing
off of the advance in investment Sc
curitieS that had taken place during
the period of extremely easy money
rates late in the Winter.
Effects of Copper Cut.
Business conditions in some directions
have favored stocks this week, in others
IIlGY have DCGIl W N1SduNdllOdBC.
The outstanding incident, of course, has
been the belated cut of cents pound
in copper metal. This readjustment to
the actual condition in the trade at once
stimulated a larger volume of buying.
There is yet no proof that 1t will lead
to normal purchases of the red metal
by those corporations that make a
large use of it in the manufacture
of their products or in the extension
of their facilities.
The slight reaction in the iron and
steel trade noted during March has
been followed by secondary upSwing
in the volume of production as the
seasonal requirements for steel products
States Steel responding in prices and in
activity. April estimates of automobile
output are more satisfactory.
During the past 10 days reports on
railroad car loadings have been making
a better comparison than earlier ones.
They are yet too much below the figures
of a year ago to produce optimism
in transportation circles. The steady
decline in railroad stocks this month
reflects the decrease Of nearly 80 per
cent in net operating income in January
and February and the fear that when
March revenues are presented they will
that already indicated.
Business Improves Slowly.
In its market operations Wall Street
has been diScounting the trade i'm
provement that first appeared with the
expansion in iron and steel in January
and carried in other directions on a
modest scale into the month of March.
The situation today Is that business Is
still slack. 1t has not realized the pro-
portions predicted for April and shows
no inclination to make quick forward
movement this Spring. 1t is all the
time progressing, with statistics of en-
ployment gathered from official agencies
and from charitable organizations in
dicating a smaller number of applicants
per position available than at any time
this year, but still too many to be salts
factorily accommodated.
Easy money has been beneficial in
some directions in giving merchants and
manufacturers more courage to go ahead
and as the level Of stock prices has ad-
vanced there is somewhat less restraint
in the matter of purchase of necessities
and of luxuries. In all, however, it is
quite apparent that the country at large
is practicing economy and saving its
money, which reflects in such figures as
gain of nearly 100000 in the de-
posts OF the New York State savings
banks In March and of nearly $1,000 in
the number of new accounts.
Decline in Exports.
Our own economic conditions are par
alleled in many of the countries that
are the best customers for our surplus
goods and raw materials. This accounts
for the slump that has occurred in ex-
ports. In March these were the small
est for the month in many years. For
the March quarter they were of $780,
O00, 900, or 20 per cent, compared with
the same period of 1929
1t may be argued that this Is the
penalty we are paying for the present
limitation of dollar loans to foreign
countries. Inasmuch as our highest
hgures OF exports last year conceded
with the minimum of foreign loans for
any period since 1924 this is not a logi-
cal conclusion. Except for Great Brit
ain, practically all of our largest GUS
toners in Europe are in a better posi-
ton to buy in this country than they
were IL months ago. The same is not
true, however, of South America or
central America, where a fair propor-
ton of the Shrinkage in exports appears.
Not only are people in other parts Of
the world economizing, but they are
steadily producing more of what they
are consuming and are retaliating in
their own way against the tariff walls
we have been building up against them.
Stimulus to Investment.
In considering the apparent contra
olctlon between rising stock prices and
an unsatisfactory business situation, one
cannot leave out of account the motive
Tor the former in the great financial
operations that constantly are taking
place and are producing both a specu-
latiVe as well as an investment effect.
Scarcely week goes by that does not
bring one or more of these into sight to
act as stimulant and to excite the i'm
aginatton of those who buy securities
Tor long future prospects. The most re-
cent development of this sort Is the pro-
posed absorption by the General Elec-
trio and the Westinghouse Electric OF
the Radio Corporation. This contains
potentialities that are difficult to meas
ure in terms of corporation profits. The
suggested merger of the two great ma
t1onal distributing organizations, Sears
Roebuck and Montgomery Ward, is an
other case in point.
(Copyright, 1901
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