Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-04-27
DECLINE IN STOCKS
REFLECTS TAGGING
PACE IN INDUSTRY
Highly Professional Market
During Week Favors Utilities
and Amusement Shares.
RAILS AND INDUSTRIALS
DEPRESSED IN SELLING
Trade of Nations Shows Signs of
Gaining Under Seasonal
Influences.
BY CHARLES F. SPEARE.

BY CHARLES F. SPEARE.
Special Dispatch to The Star.
NEW YORK, April ga stock
market that has given more recognition
this week to the true facts in the
business situation shows net average
decline and loss of substantial part
of the gains made in the first half OF
the month. It has been a highly pro-
fesSional market.
On Wednesday, with transactions ex-
ceeding 100000 shares, more than half
were concentrated in 20 ISSUES of the
total of $50 quoted on that day. Over
20 per cent of the turnover was In
seven stocks representing the amuse-
ment and collateral industries.
It is safe guess that so per cent of
the current business being done on the
New York Stock Exchange, and like,
wise on other exchanges here and
throughout the country, is for the pro-
fessional element. The public is less
actively interested than it vas several
weeks ago.
Opposite Trends in Groups.
A parallel between market movements
now and during the greater part CT the
Spring and Summer Of 1929 may be
found in the opposing trends of diff
ferent groups of securities. While GER
tain ones are advancing, others are de.
clining, so that the daily list Of new
high and low prices for the year fire.
uuently balances. Those that are ris-
ing because of their immunity from the
effects of a trade recession this
includes the public utilities and the
Amusement ShareS-eXcite the greatest
attention, command the largest volume
of trading and throw a smoke screen
over the dozens of industrial, Elerchan-
dising and railroad equipment issues
that are steadily being depressed by Ii
quotation and the switching from them
to other stocks less influenced by bust
ness ills.
In consequence Of these contrary
movements we find one element in Wall
Street which, viewing the business out
look through the medium of its buoyant
specialties, finds it promising, while an
other group Of investors, holding stocks
that steadily react, are looking for more
serious conditions in business and q
sharper decline in securities than Is
likely to be realized.
Trade Outlook Improves.
Trade is not picking up to the ex-
tent predicted a month or two ago.
About all that can be said Of it is that
it is moving slowly forward under sea-
Sonal influences. It promises to be bet
ter in May than in April, as April
improved over March. The late Spring
and Summer are likely to be quiet,
which puts forward the date Of any
striking improvement to September or
october: If this Is an accurate judg--
ment Of the outlook, then stocks that
are intimately identified with the main
branches of manufacturing, merchandise
ing and transportation do not justify a
further advance from the high levels re-
Gently established for them.
For the present, at least, the in
huence Of low money rates on specu-
lative issues has worn of, just as it
has on bonds.
The estimated motor car production
for the first half Of this year is 2,100, 900
cars, or a 40 per cent decrease from
will make decided impression on earn
ings for the six months as they are
published next Summer. It is to be
remembered, however, that majority of
the important producers have been
establishing reserves Of cash and of
marketable securities in the past few
years, that they have reduced their
liabilities and that few of them have
a bonded indebtedness.
Reduced earnings do not necessarily
mean reduced dividends.
Trying Period for Railroads.
The transportation industry has been
seriously upset by the slump in domestic
and foreign trade and has just present.
ed set of figures of net operating re-
suits for the March quarter that would
argue for lower dividends if the car
riers had not adopted in recent years
a conservative policy, both with respect
to payments to shareholders and dis
bursements for maintenance. There
has been no serious suggestion that any
one Of them would be compelled to re-
duce its dividend rate, in spite of the
fact that the past six months have been
the most trying they have experienced
in years.
In other directions conditions are
satisfying. The January and February
gross and net earnings of the public
utilities, exclusive of the telephone and
telegraph companies, were in excess of
those in previous years. Movements in
public utility stocks not only represent
this situation, but the steady shifting
of control Of properties from one group
of bankers to another at pyramiding
prices. The oil industry slowly Is
emerging from the effect of its excuses.
separations Loan Near.
The establishment this week on a
working basis of the Bank for Interna-
tional Settlements brings nearer the Of
fering of the $500 ,00O,0 600 reparations
loan, in which the American market has
an intimate concern. The amount ap-
portioned to this country Is small In
comparison with some of the domestic
issues that are presented from time to
time. It would not seem necessary
therefore, that any great amount Of
propaganda would be required to intro
duce it.
The American investing public is ia
miliar with dollar loans today, though
it had to be instructed in them when
the original French, Belgian and Ger
man government issues were brought
out here. No loan, however, foreign or
domestic, ever goes well when stocks are
unsettled. This may be one of the rea-
sons why so many people feel that the
speculative market will be kept on an
evel keel until after the loan has been
presented in June.
Copyright, 1sso)
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