The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1934-07-02

love, resistance Lewis Haney
level.
Several preferred stocks nego-
tiated new highs for the year.
Bonds, however, turned rather
weak, and closed a little below
the average at the end of the
preceding week.
The Presidents broadcast was
confined to vague generalities,
and contained nothing new. Aside
from inflationary implications in
volved in government spending
and doing justice to silver" the
effect on business sentiment was
discouraging. Perhaps the refer
ence to "self government" was
designed to encourage, but this
was hedged by reference to fair
competition. Perhaps he showed
some realization Of his previous
error in calling people Childish"
who think recovery should come
ahead of reforms: but his
emphasis was on reforms. Any
how, the only response of the
market was to sell off a point.
At the moment it looks as if
We are in for a very dull sum-
mer as to business. With
Congress at home, the Presi-
dent away, and many new
strange laws to experiment
with, it is hard to see where
much market stimulation is to
come from. Incidentally, I
note that the put and call mar
ket suggests that only narrow
movements are anticipated in
either direction.
There is a considerable element
In the street, however, which
looks for an inflationary ride
this fall, and this idea is likely
to bring in some buying in antici-
patton. If the business outlook
were brighter, the result might
easily be considerable rise this
month.
AS things stand now, and with
the new stock market regulations
to digest, the result is more
doubtful, but it does seem pos
sible that before long the market
may edge up, under the leader
ship of stocks which are expected
to benefit by initiation.
The way in which bullish and
bearish factors balance, however,
does not suggest any large move.
For example, the most active
stocks from day to day have held
up well; but they furnish only
small percentage of total volume,
and bonds have turned softer.
Despite threats and bad news,
the averages are holding above
the general level of the past two
months; but business has recently
turned downward more decidedly,
and there is perhaps little more
uncertainty about the expected
fall upturn.
Many hold stocks persistently
because they expect initiation, and
anyhow do not see what better
they can do with their money;
but they may have all the stock
they want and mere holding does
not put a market up.
There have been no runaway
markets with speculative excuses:
but certain blue chip stocks have
been held very high compared
with earnings, and some indica-
tipns of distribution" have ap-
peared.
On the whole, I am inclined
to expect the market to hold,
pending the gradual develop
1nent during the next few weeks
of light on fall business, fall in
flatiOn, and fall elections, as af-
feCting social management"
And, since the prevailing tend
ency Of sentiment now seems to
be to expect bullish develop
mentS in the first two respects,
/ would guess that a moderate
rise is likely from the levels not
much lower than the present
one.
I would prefer carefully Sc
lected Colds, silvers, building sup
plies, stores, chemicals, and oils.
I would avoid rails, steels, textiles
most utilities and COpperS,