Evening star., 1932-08-04
STOCKS. SELL OFF, !.
FROM EARLY GAINS
Market Closes Active Day
With Net Recovery, but
Below Peak.
BY GEORGE t. HUGHES.

Special Dispatch TO The Star.
NEW YORK, August -Boisterously
strong in the morning, todays stock
market reacted in the afternoon and
while closing higher for most issues,
was without spectacular feature. Dur
ing the course of the session. however,
new high marks on the recovery were
set up.
The volume of trading was the larg-
est since october a year ago. If the
pace set in the first half hour had been
kept up. it would have been a 5000, 900
share day. AS it was the 5000 900 mark
was crossed shortly after 2 O'Clock, but
in the last hour activity decreased
sharply.
Commodities moved much as did
stocks. Wheat staged a bull demonstra-
ton in the first half of the day, only to
lose the greater part of the gain before
the close. Speculation on larger scale
came into the crude rubber market.
which likewise advanced, but could nos
hold all the rise
Stock Exchange seat sold for $780,
000 up 100000 from the last sale. The
most important dividend action was
| the cut in the rate on National Dairy
Products. which was put on a 50 an
nual basis instead of $3.50 previously
paid This was as had been anticipat-
ed and had no market effect
The market opened higher, reacted
slightly and then resumed the advance
This is not to say, however. that the
market was indiScriminate. Two classes
of stocks were in urgent demand-flrSt,
those which harbored badly over
crowded short interest and, second,
those which either represented corpo-
Iations that have made definite prog
reSs toward recovery or shares which
had been depressed eXtravagantly below
their real values in the recent period Of
despair.
Under the first head came stocks
such as j. I. Case. American Tele-
phone & Telegraph falls into both clas-
/ sifications. The short interest in Case
was roughly treated as the stock
mounted to points on top of yes
/ terday's 5l2-point gain, an enormous
/ percentage increase for stock selling
| at its price level. Case has always
been a favorite target for short selling
/ because the company, doing SO much OF
/ its business with the farmers. looked as
| though it faced exceptionally difhcult
/ times. There is, however, a Scant float
/ ing supply of the stock and the selling
! had been grossly overdone. More or
less the same applies to International
/ Harvester, which was very strong to-
/ day although it's floating supply Is
/ larger than Cases.
The rise in these stocks was accel-
Grated by the belief that the commodity
markets, particularly wheat, were
ports which, whether well founded or
not, caused it to believe prominent
spectators had turned their attention
| to grains.
In American Telephone the selling
! had been based on the loss of stations,
! which has heen going on progressively
/ for months, and on doubt about the
| next dividend. That had been over
| done, too, and Telephone SCARED today
almost to par, up nearly 80 points from
/ the bear market low. Besides traders
| are now not so sure there will be any
/ change in the rate at the next meeting.
! Stocks bought because of better con-
! ditious in the industry included the
oils. The leader here was Standard of
New Jersey, at a new 1882 high, above
/ S33 a share. Ohio Oil made a new
high and Atlantic Refining duplicated
its old high all bsfore noon. In most
of these stocks the gains were mod
/ crate, but were we'll maintained. Every
prominent oil company reporting for
! the second quarter shows larger earn
ings than in the first three months,
and that can be said Of no other class
| Of stocks.
United States Steel preferred, also
| oversold, advanced. 3 to 4 p3ints while
the common was making a new high On
/ the movement. The tobacco stocks
were buoyant with American Tobacco
| issues in the lead. American Can, Al
/ lied Chemical, General Electric and
/ other popular industrialS made new
highs on the recovery. General
| Motors gained point on declaration of
| the regular dividend
That the market had gone too far
| and too fast. that it was out of step
/ with such improvement as had actual
| ly been achieved in business, was an
! opinion widely held.