Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-09-14
Reaction in Market During
Week Marked by Drop
in Trading.
PUBLIC PARTICIPATION
IS ON INCREASED SCALE
Continued Ease in Money Rates
Gives Aid to Bull
Party.
BY GEORGE T. HUGHES.

Special Dispatch to The Star.
NEW YORK, September 13.-Busi-
ness sentiment is q little more cheerful
this week and there are more tangible
facts to support the optimism, If it can
be called that, but the stock market is
not SO sure as 1t was. Prices for typical
issues have made new high since last
Spring, but the gains were not held and
any indication of sustained advance
was entirely absent.
Signs Of Recovery.
Signs of trade recovery are few in
number, but deserve consideration. In
the first place, there has been q check
to the fall In commodity prices, not
withStanding the renewed break In
wheat. The compilation made by Dun
g. Co. shows 80 advances in wholesale
quotations against % declines, in COM
parison with last week. There are
plenty of striking exceptions to the
trend besides wheat, one Of which is
rubber, which went to record low.
The metal situation leaves much to
be desired, with copper still quoted
under IL cents a pound. The August
statistics were unexpectedly discourage
a turn for the better in the domestic
hide market and significant resistance
to pressure in many other directions.
Car 1oadings are increasing and the
rate is a little larger than the seasonal
normal. If this trend continues it will
foreshadow the real turn in trade, for
which all have been looking. Then
there are better reports from the textile
industry and from the department
stores, which are experiencing the pick
up in Autumn demand. 1t is a little
steel, with the authorities at variance,
but at least matters are no worse than
they we're.
New High for Stocks.
AS for the stock market, great hopes
were raised when the averages made
their new high early in the week. On
Wednesday the 90 stocks included in
the Standard Statistics index closed ut
1876, whereas the high of last July
reached on the 2Sth, which was the best
since the June break, was 170.1. Re-
newed professional operations brought
about a setback from this point, leav-
ing the market with ragged and UNI
certain appearance.
The chances are that the reaction Is
surface. For one thing volume was al
ways larger on the advance and fell
of on the decline. The turnover is still
abnormally low, much to the distress of
the brokerage fraternity, but it Is larger
this week than 1t was q week ago. For
the four full flve-hour business sessions
for the week ending September 5 the
average sales were 1,672,4T5, and the
average for the five days ending Sep
teimber IL was 2,060,760 shares.
Another evidence of an increased
public participation, slight, to be sure,
but welcomed In Wall street none the
less, was the increase in brokers loans.
They are up this week $33 900 900,
against an increase last week of 8,000.-
900. The rise in the total Is favorable
rather than otherwise. It will have to
go much further before any concern
is aroused, with the total back where
1t was In 1927 and the ratio of borrow
ing by members of the exchange
against stock collateral down to sal
per cent Of market value of all shares
listed, a new low since this computa-
ton was begun.
Stocks are in strong hands. Money
rates continue easy. If the Autumn
trade improvement fails to arrive on
time, or If there are other now unan-
blClpdbeQ hQNeISe OeNeIOpneubSs The
market would react regardless Of its
technical position, but there will be no
hasty liquidation. On the other hand,
If business gains at faster rate than
now looked for, the market is sure to
reflect the situation with higher price
level.
Perhaps the strongest argument
against rising quotations for stocks is
that they have not yet been brought
down to point where the investment
return on issues with unquestionable
dividends is sufficiently attractive. 1t
is urged that the price-earnings ratio
today is higher than 1t was in any
other major depression. For example,
the 80 stocks used in the Standard Sta
tistics averages are selling over is
times estimated 1880 earnings, which
the critics say Is entirely too high.
lCopYriRht. 1901