Evening star., 1932-02-05
BONDS ARE LOWER
IN ACTIVE MARKET
List Slips OF After Firm
0pening-RaiI Issues
Featured.
BY F. H. RICHARDSON.

Special Dispatch to The Star.
NEW YORK. February 5.-Bonds
moved generally lower today in moder-
ately active trading.
The opening was firm but extremely
dull. The application by the PennSyl-
Vania Railroad for a loan from the
Reconstruction Finance Corp. was a
surprise to Wall Street, where it was
supposed that the stronger roads would
leave the corporations funds available
to the roads urgently needing aid. This
started some selling of railroad bonds
and losses of l to points occurred in
long list, including Chesapeake
Corporation SIS, st. Paul SIS, Rock
Island refunding As Denver & Ri1
Grande Western SIS, Erie SIS, Missouri
Pacific SIS, Nickel Plate 6s, Southern
Southern Railway As.
Allegheny Corporation 5S opened
Sharply higher, especially the 5s of
1850, which were points higher at
one time. The corporation, which con-
trols Chesapeake Corporation, Chesa =
peake & Ohio, Missouri-Pacific and
other railroads. announced today that
various non-income paying collateral
deposited behind the SIS had been with
craWn and replaced with Terminal
Shares, Inc, notes, which are paying
interest. The revenue from the de-
posted collateral is thus sufficient to
pay interest on the bonds secured. Be
lore this was done collateral behind
the SIS of 1856 had not been sufficient
to meet interest payments. although the
5s of 1914 and SIS of l949 we're so Sc
cured.
Apart from the rails there was little
activity in the domestic list. Indus
trials were generally dull Utilities of
seasoned investment grade. such as
American Telephone SIS. New York Tel
ephone 4l2S. Consolidated Gas Sis and
Duquesne Light AIS, were firm. United
States Government bonds were mar
rowly lower, with out a great deal of
activity in them.
ms the foreign department. the Far
Eastern situation was appraised as
being more serious than ever. and
japanese government bonds were forced
down a point or more. The 619S and
5'2s were most active, but there we're
similar dips in Toho Electric IS and
Is. Toxic SIS and Sis Taiwan 512a,
Shinyetsu 6l2s. Yokohama 6s and
UligaWa Electric Is. Great Consolidated
Electric Power Of Japan 6'2s and Is
were also heavy.
Australian bonds continue to show A
firm tone Australia SIS of 1856 and 1857
both were up a point or more. New
South Wales SIS, Queensland Is. Sydney
rs and other Australian municipaIs
were all higher.
German government bonds drOpped
and other Europeans we're
also inclined TO sag, but there was A
very small volume of trading in them
British SIPS reflected the firm tone Of
sterling and other foreign exchanges.
The municipal market was active and
fairly firm. The announcement that a
first payment would shortly be made
on the defaulted issues Of Asheville and
Buncombe County. N c.. was received
with some surprise. as recent bank fail
ures in that region had tied up some
S8000,000 of public funds.
Domestic bonds were firm at the
opening, while the foreign list was
heavy.
Allegheny Corporations SIS. rejecting
the substitution of income paving COL
lateral behind the bonds, advanced
sharply The 1850 maturity gained
more than 2 points and the 1914 and
l949 maturities rose fractionalIy.
The activity in New York traction
securities continued, with fractional ad-
vsnces in Interborough refunding SIS
and Manhattan Railway As The at
tention of the city inquiry has been
turned toward reports that the new citv
subway will not be ready for operation
in April.
The railroad list was firm. with
small initial gains in Erie 5s. Missouri
Pacific IS and Nickel Plate IS. Indus
trials were unchanged. United States
Governments opened shade higher,
III the foreign department japanese
government bonds were fractionally
lower.