Evening star., 1932-10-23
TRADING IN STOCKS
LOSING MOMENTUM
| AS ELECTION NEARS
Railroad Shares Have Dis.
played More Resistance
Than Industrial List.
PROGRESS IN INDUSTRY
MORE THAN SEASONAL
Increase in Public Buying Marks
End of Hoarding-Gold Stocks
Continue Gain.
BY CHARLES F. SPEARE.
Special Dispatch to The Star.

BY CHARLES F. SPEARE.
Special Dispatch to The Star.
NEW YORK. october Gas the
national ELECTION draws near, markets
and industry are again approaching
the static condition OF last Summer.
Both have lost considerable OF their
momentum and the confident quality
that characterized their movements be-
tween the early part OF July ana tne
middle of September.
AS the essence of the presidential
campaign this year is its economic i'm
plicationS, it is not strange that IN
vestors and spectators in securities, al
SO manufacturers, jobberS and nler-
chants should hesitate to make for
ward commitments after they had quite
literally responded to the improvement
in fundamental conditions through pur-
chases of securities and Of commodities
and by considerably enlarging the out
put of their factories and replenlshng
empty shelves.
Average prices Of stocks today are
about where they were week ago.
It Is worth while at this time to re-
view the course of the market since
it started forward early in July. The
maximum average advance In the in
dustrial group, from that time to Sep
tember 8, was 38 points, or about 80
per cent. In rails it was 26 points. or
200 per cent, and in public utilities,
nearly 20 points. or l20 per cent. In
the subsequent decline industrials have
had an average fall of over ID points,
or 48 per cent: rails one OF III points,
or Al per cent. and public utilities II
points, or SIS per cent.
Rails Show Resistance.
The striking feature of this weeks
market has been the heaviness OF in
dustrial shares and the resisting quail
ity that has distinguished railroad is
sues. This suggests that there was
larger speculative account in the one
than in the other when the market be-
gan to reflect political uncertainties,
though quite as much the relatively
better symptoms of credit recovery in
the field of transportation than in that
of manufacturing.
OF beth it may still be said that they
are slowly gaining ground. The opinion
Of the trade agencies and the surveys
made by statistical organizations indi-
cate that, while some of the September
momentum has been lost. such prog
ress as is being registered is more than
seasonal. This is true of car loadings
of Unemployment and of pay rolls in
the industrial section of the East. Credit
should also be given to the continuing
slight weekly gains in the output of
iron and steel. 1t Is significant also
that requests for institutional and cor
poration loans from the Reconstruction
Finance Corporation have been decreas-
ing, while repayment of funds to early
borrowers from this organization has
been increasing.
The longest period of violently dis
turbed weather conditions in many
years has adversely affected retail trade
along the Atlantic Seaboard. Even in
this there are ample evidences that the
purchasing power of the public has
either actually expanded or that the
willingness to spend reflects an absence
of fear over the banking situation. This
latter is constantly being strengthened
by the return of boarded currency and
by weekly additions to the country's
gold supplies.
Dividend Rates Maintained.
The earlier disturbing factors Of divi-
dends reduced or omitted and of quar-
terly corporation reports that revealed
the depth of the industrial depression
no longer give active employment to
those who would spread the doctrine
of despair. Their has been almost no
change in the last three months in the
average rate of dividends being paid
on selected group of 600 listed and
unlisted stocks.
Unless this country sinks into greater
industrial disorder than it did during
the first half of 1882 it is fair to as
sumo that the majority of corporations
have adjusted their expenses and have
conserved their resources sufficiently to
maintain the rates now being paid to
their share holders. They have so
thoroughly eliminated unnecessary ex-
pense that the ratio of net profit to
any expansion In gross receipts will be
the largest since the period before the
war.
In no direction has cost curtailmenr
been carried to a greater degree than
In the maintenance department of the
railroads. Yet it is a recognized fact
that never before have the carriers of
this country passed through a long and
severe depression with fewer accidents
Resulting from neglected tracks or un-
dermalntained equipment than IN the
present one. They have imposed great
sacrifices on their stockholders, but have
maintained an adequate service for ship
pers and for the travelling public. The
AcOuCtlOu III .SUeel Tails LIllS week OF
So a ton Is Of greater advantage to them
In their economy program than any
offered since the 10 per cent wage re-
duction last February.
Politics and Markets.
With all of these facts in mind. in
cluding a reaction in securities that has
cancelled about half of the July-Sep-
tember advence. it must be conceded
that markets are guaranteed a certain
amount of immunity from decline in
the event of a change in the national
administration
Altogether the situation is not one
that warrants those who have bought
and paid for their securities in becom-
ing alarmed and disposing of them at
present debated levels. There will nat
urally be individual situations that can
not continue to withstand the drains OF
the last three years, even though there
may be q slow recovery In earnings.
The period Of the survival of the f1ttest
is not yet past But while there are
many men Of sound judgment who SIN
cerely believe that the election Of
Democratic President would retard the
business recovery, there are few who feel
that security prices and commodity
prices and the business index will dupli-
cate those of last July.
Copyright, 1932)