Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-08-08
STOCKS ARE LOWER
IN SELLING DRIVE
All Groups Hit by Liquidation
on Bearish Trade
News.
BY CLAUDE A. JAEGER,
Associated Press Financial Editor.

NEW YORK, August s.--The long.
becalmed stock market was driven fan
out of the course charted by the bull
leaders in a sudden storm Of liquida-
ton today.
Important stocks generally were de-
pressed 2 to 8 points or more, as the
heaviest selling experienced in Severa
days was loosened by such undermining
developments as dividend cuts, slack.
ening steel mill output and SHARP
break in cotton.
Sales during the first two hours ag-
gregated 1878, 900 shares, exceeding the
average turnover for the past four full
five-hour sessions. Rails and utilities
were under particularly heavy pressure
Real liquidation of long holdings OF
stock was said in brokerage circles to
be in substantial volume, but profess
sional traders were increasingly active
on the short side of the market.
Rails Under Pressure.
The loaning rates indicated that the
rails. in particular, were choice targets
of the professional bear element. Prac-
tically every carrier stock was loaning
fiat.
The speculative fraternity was still
greatly confused over the probable eff
fects of the severe drought. The Gov
eminent cotton report as of August
placed the crop about 100000 bales
higher than generally expected, which
caused immediate declines Of $3.50 to
50 bale in the New York futures
market.
Although wheat made good progress
during the early hours of trading, the
collapse in cotton brought moderate
reaction, even in that market.
It was estimated that United States
Steels mills had Slackened from "a per
cent of capacity few days ago to 81
per cent. The passing of Warner Bros
common dividend, while rumored for
several days, provided a shock in some
quarters, for many traders had felt
that at worst the cash payment would
be reduced, or that 1t would be sub
stituted for scrip.
The rails were liquidated on the
theory that reduced crop movement
would seriously impair earnings, so that
in addition the roads would be asked
to reduce grain rates to relieve the
agricultural areas.
The utilities have been under almost
steady pressure for several days, re-
sulting from the tendency toward lower
power rates. Owing to heavy fixed
charges, only moderate reductions in
rates might sharply reduce earnings
per share, and the utility shares have
still been selling at considerably higher
ratios to earnings than other groups
AS during all bear movements, unset
Ting rumors were circulated, such as
reports that investment trusts were
hQuidating electric power stocks, but
confirmation was lacking.
The decline carried prices to the low
est levels since the forepart of July,
most pivotal stocks breaking through
their recent resistance points. Save
for the lower levels in June, stocks gen.
orally were reduced to new low levels
for the year.
Leaders Decline.
Such stocks as U. S. Steel, Radio and
Standard of New Jersey, which have
been held fairly steady during recent
eral Motors and General Electric lost
about 2.
Warner Brothers dropped about 7
points, going below SO, or about so
points under the years peak. Billiard
was also weak spot, dropping as much,
on poor earnings statement, and
reaching levels about so points from
the years top of IA
American Telephone, Du Pont, Byers,
Stone & Webster, North American Corn
Products, Eastman, Atlantic Coast Line,
American Can and Vanadium lost 4 to
s. Worthington Pump lost more than
8. Losses of 2 to points in the rails
were numerous.
Call money renewed at 2 per cent
again, after two days of renewals at az