Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-08-17
MARKET REFLECTS
10
IMPROVED OUTLOOK
Wall Street Believes Bottom
) OF Business Depression
Has Been Reached.
BY CHARLES w. STORM,
- go - ~, s,.-..t.. "a xxy.,t ct.o.k

BY CHARLES w. STORM,
- Editor the News Service Of Wall Street.
Especial Dispatch to The Star.
IA NEW YORK, August 17.-Concen-
fration of buying by strong speculative
groups anticipating seasonal improve
bent in business during the Fall ac-
counts for the increased activity and
higher range of stock quotations wit
11essed the last week. Whether or not
business will expand remains to be
seen. but those who are now identineo
prominently on the constructive sloe
helieve that trade has reached such
low ebb that it must OF necessity snow
betterment during the Fall months.
The Street is practically unanimous
in believing that the bottom has been
reached and that there should be in
creased industrial activity If only from
the neeesSitous demands of consumers
at a time when merchants shelves are
reported to be bare of goods. 1t is
with this in mind that important
operators on the bull side OF the mar
ket have taken the initiative. The
comprehensiveness of their operations
leads to the belief that their activity
has the cooperation of important bank
ing interests. who would be the first to
see signs of q broadening of manutac-
turing activities.
Reports were also current that close
TO 80 per cent of the industrial cor
porations whose stocks are listed on the
Stock Exchange are now experiencing
change for the better in their busi-
Iiesses Isolated signs of this better
ment have come to hand, but IL wiz
rot become generally apparent until
the turn for the better is more pro-
nounced.
Hopes Are High.
Hope is being entertained that the
courage of aggressive market operators
will engender a public following SUI
ficiently large to enable the continual
ton of the forward movement.
The magnetism of higher prices has
created some increased interest on the
part Of the public, according to large
security dealers. While the demand ior
stocks from the public has been slight,
the fact that there has been some i'm
Irovement leads to the hope that there
will be further expansion.
One encouraging sign has been the
Improvement in the bond market. In
asnnuch as the Nation has become stock
minded it would not be surprising II
the Improvement in the securities mar
kets precipitated better feeling IN
general business, thus laying the founda-
ton for a resumption Of trade expaI1-
sion.
While the banking fraternity and the
Street believe that there will be ex-
pansion in business this Fall there are
some who think that it may be some
what delayed Moody's Investment
Service states that indications thus far
are that seasonal Improvement is being
delayed" 1t says the few available
statistics for August do not suggest
that it has begun yet and that with
lar ~ f1F Ea nlo1f n
pscity shut down, it looks as though the
August-September rise in activity would
be late in starting by several weeks.
* Hope that a turn for the better is
innminent is entertained by the reports
coming to hand the last week Of spotty
Improvement in new construction. The
fact that the steel industry failed to
Show any further contraction the last
week was also considered encouraging.
Less apprehension Is entertained with
regard to the foreign situation as re-
f1ected by the higher prices which pre-
prevailed for European bonds the last
week, especially the German govern
ment issues.
Oil Factor.
Another source Of hope is found in
the favorable developments which have
appeared in the oil industry the last
week. The passage Of laws by the
signed to control production Of oil, to-
gether with shutting down of produc-
ton in Oklahoma, are expected to
cause a change for the better in the
oil industry, and this belief has caused
important people TO purchase oil stocks
aggressively..
The deplorabIe conditions which have
existed in the oil industry have been
a factor In the depression so that q
change for the better In that direction
should have a favorable influence on
sentiment
The unfavorable earnings being re-
ported by the railroads leading TO the
possibility Of further reductions In their
dividends continues TO be a depressing
factor on the stock market, but the
financial district believes that the In
terstate Commerce Commission will
recognize the urgency Of the present
situation and will give the common
carriers some relief
The feeling of hopefulness in the
Street is such that the big professional
shorts are standing aside and refusing
10 resume their operations on the short
side, believing that defation in stocks
has been overdone for the time being
and that the market is at least en-
Titled TO further upward movement
until ii Is hScertained whether or not
Fail Improvement in business has ma
terialized
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Newspaper Alliance, Inc