Evening star., 1935-10-06
WAR HALTS GAINS
IN STOCK VALUES;
BONDS ALSO DROP
Weak Technical Position
and Railroad Troubles
Add to Pressure.
SECURITIES MOVE BACK
TO MIDSUMMER MARKS
U. S. Recovery Trend Is Expected
to Continue Without Drastic
Effects From Foreign Situation.
. BY CHARLES F. SPEARE.

BY CHAkLES r. SFEhhE.
Special Dispatch to The Star.
NEW YORK, October 5.-Both busi-
ness and the security and commodity
markets have been affected this week
by those unexpected and unforeseen
events that develop acknowledgements
often in these days, Internationally
and which change the temporary
course of industry and the trend OF
prices.
Stocks and junior bonds had dis
counted the beginning Of war between
Italy and Ethiopia in a series Of de-
clines dating we'll back into September.
The mobilization of troops by both
countries later diSlodged weak holdings
here and produced some liquidation
from Europe. Very quickly the aver
age gain in September was erased.
Individual issues went back to the
levels of Midsummer. The domestic
bond market has had a relatively
greater decline than the market for
stocks, due to the slump in railroad is
sues now in default or threatened with
suspension of interest. Foreign dollar
bonds are at the lowest average Of the
year and II points under the high OF
last February. Their position Is az
fected by the liquidation in Italian
issues which. as group. are quoted
below so cents on the dollar.
London is surprised that the New
York market this week should have
taken the war situation so seriously,
forgetting that it was here that the
most extreme reaction to the assassina-
ton Of Premier Dollfuss Of Austria last
more volatile than her own. Had
there not been a long and sustained
rise in stocks, the effects of the exist
ing troubles in Europe would have
been more moderate. On technical
conditions alone, stocks were due for
q decline.
Toward the end Of the week more
confidence was expressed in the pos
sibilities Of localizing the war area,
and markets then showed a reviving
tendency, except for railroad shares.
No Drastic War Effect Seen.
The implications Of the Italo- Ethio-
plan conflict are too great to warrant
prophecy Of its scope and the extent
to which 1t may draw in other nations.
The best informed have again been
wrong In their reckoning Of the Italian
policy and program. 1t is reasonable
to believe, however, that there will be
no great amount of liquidation either
for domestic or foreign account and
that the processes of recovery here.
stimulated artlficially and developed
naturally. will proceed throughout the
remainder Of this year. Commodities,
such as wheat and cotton, have al
ready experienced sharp upturn
The domestic commodity average is
the highest since July, 1880. That of
Great Britain tops any level since the
gold suspension act in September, 1881.
One of the great misfortunes of the
war, from a material standpoint, is
that it has broken out just when re-
covery had become apparent every
where and demand from consumers,
who have been slow to buy since 1929,
was making its effect on raw materials
oAAe n SIuuy
of private income this year. exclusive
OF that contributed by Government re-
lief, indicates that this had risen 8.5
per cent over 1884 in the first eight
months of 1885. Included in this Is q
gain Of about $4,000, 900 in corpora
ton dividends.
Trade Makes Progress.
Some of the evidences of business
progress given during the week were
the rise in iron and steel production
to 52l2 per cent of capacity. which re-
covers practically all of the decline last
month; an increase in electric power
production of 1876 per cent over the
corresponding period In 1884, and q
rise in bank clearings, exclusive of
those in New York, of II per cent above
the first week on October last year
to the largest figure since January,
1882. Bank exchanges in Pittsburgh
were up so per cent and those In De-
troit 23.5 per cent, suggesting the de-
gree Of activity at two Of the greatest
industrial centers Of the country.
Good weather has been helpful to
retail trade in the East. Heavy buying
Of agricultural implements is reported
from the West. However, wherever
the tenor of business is influenced by
stock market conditions, there has
been a noticeable lull compared with
the briskness of demand a few weeks
ago. 1t is satisfying to record a drop
in unemployment in August of 22O 900,
bringing the total still without Jobs
below 100000 for the first time in
months.
Rail Securities Slump.
The break in the securities OF the
New York, New Haven and Hartford.
preceding payments of coupons due
October l, the tilt between the bank
ers for the New York Central and the
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