Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-08-09
INVESTMENT BOND
MARKET ISSTRONG
Demand for High-Grade utiIi-
ties and Government Is
sues Firm.
speclal plspateh 70 The star.

Special Dispatch to The Star.
NEW YORK, August 8.-Junior rail-
road bonds this week dropped to their
lowest levels Of the year and there was
sharper dip in the senior carrier
mortgages than has been the case for
some time. At the same time the bal
ance of the domestic bond list held
fairly well, there was continued firm
demand for high-grade utility bonds
Government issues held near their highs
and short-term paper commanded un-
precedented premiums.
In the foreign list there was little
tendency to retrace lost ground apart
form a modest rally in German dollar
bonds near the week end in response
to the successful reopening of the Ger
man banks both savings and CONNER
cial The extension to Germany Of a
long-term credit along with the offer
of American cotton was favorable fac
tor and helped Young plan 12s to re-
gain about points. Dawes reparations
Is also improved. So. to q lesser ex-
tent, did German bank issues. But the
rest OF the German list remained slug
gish because of the attitude adopted by
both local and continental markets OF
awaiting further developments in Ger
many before making commitments.
South Americans and the junior Eu-
ropean group remained liStless or de-
clined further in the absence of any
constructive news. Australian issues
improved with the announcement from
refunding operation will shortly be put
into operation.
To return to domestic railroad issues
For thu first half of the year the class l
roads reported deceaSe of 81 per cent
in net operating income from the same
1880 period. For the month of June
the decrease was 20 per cent The alb
sence OF any proposal to extend the reg
ulations under which carrier bonds are
made legal for investment by savings
banks and trust funds prompted many
of thsse institutions to liQuidate their
holdings rather than run the risk OF
further capital depreciation.
According to Standard Statistics in
dex OF railroad issues the group ended
the week at th.ir lowest level of the
year, which means the lowest level in
about eight years. Since this index
includes soma high-erade rail mort
cages 1t Is apparent that some of the
prime issues we're affected. Even the
conservative Atchison General As and
the highly regarded New York Central
OoESOuQdteQ As SOlQ Oh ABOUT point,
and floor traders reported that 1t was
exceedingly difi1cult to place blocks Of
railroad bonds of any description
In the junior list the liquidation
caused havoc. Nickel Plate 6 per cent
notes, which mature next year. sold 26
points below ttsir high OF the gear
Nickel Plate AVS touched so. Erie IS
dropped below 70. Missouri-Pacific SIS
were below 80 and Missouri-Pacific gen.
eral IS under So. st. Louis-San Fran
cisco 411as sold at AZ And so on through
a long list Of such bonds.
Elsewhere the market was steadier.
Industrials, which had any sort of good
news to build upon at all were frm.
Dodge Brothers IS, for instance. held
closely to their best price Of the pre-
yious week. United States Rubber SIS
were firm around 10. Goodyear SIS.
Goodrich SIS, Vanadium SIS, Shell Union
OH SIS, Texas Corporation SIS and a
number Of similar bonds were well sup
ported. Some industries have shown
undoubted Improvement and others.
such as rubber and the metal trades.
are In an excellent position to take Inn
mediate advantage Of any improvement
in business.
(Copyright. 1917