The Washington times., 1935-05-06

K ~ .S$:: A n n d a
copper, were
among the act.
i've issues to
gain, but Silver
~ King and Park
Utah lost. In
Lewis Haney this connection,
the action of Peru in putting an
embargo on silver exports should
be noted. This should affect
Cerro de PaSco.
New leaders, however, came to
the front. Chrysler was active on
sharp rise of over 4 points Gt
ran into selling at 42). Allis
Chalmers spurted. Montgomery
Ward gained on volume. Notable
performances 7ere shown by
American Bank Note, McKeesport
Tin Plate. Air Reduction, West.
inghouse Electric, Republic Steel
and Inland Steel; and a marked
strength came into Standard
Brands.
The stimulantS we're: (D A
good earnings statement by
Chrysler; ~ a court decision
favorable to the Republic Steel
merger; 81 reports of large
business expected by farm inn
plement manufacturers, and az
hopes based upon the growing
opposition of business men to
New Deal schemes.
The weeks performance, &C.
cording to averages, may be
summed up as follows: The lin.
dustrials" gained ground, and
came within a fraction of the
April high level. The rails" lost
ground, and remained over a
point below even their relatively
low April bulge. The utilities"
gained a fraction, but did not
reach the best level of April.
One must be impressed with the
miscellaneous and changing lead
ership among industrials, and
with the backwardness of railway
stocks.
Technically, the market is in a
position very similar to that found
at the end of last October, and
this would suggest a moderate
further rise.
There are some differences.
however, and notably the fact that
business activity was then about
to stage a rise, while now it is de-
clining from the peak of that
same rise. At that time, too,
business leaders we're staging
cooperation" act with the Presl.
dent. Now they are cooperating
against him.
Probably the net result now
will be trading area" with not
much of a move in the averages,
while some stocks go up and
others down.
The market may fiddle around
for a few days, and then sell off
a little. Or it may go ahead
another point or so here, and then
recede again. But, while the pos
sibilities of any immediate large
rise seem very limited, can see
no indications of any bad break.
On the bear side, one may say
that there was no volume on the
last rise, and little interest was
developed. Possibilities of
double top" formation are shown
by the charts. The rails very dis.
appointing, and bad traffic and
earnings figures furnish a poor
background. Strikes are disturb
ing.
On the bull side, we note that
the volume of trading also fell Oft
on the preceding decline. The
Thursday reaction was checked at
the gap" level of April 20. This
large majority of issues were up
on Friday and Saturday, and the
most active issues mostly rose.
Socalled investment buying
goes on. 1t is based upon low
interest rates and anticipations
OF further depreciation in the
dollar. There is also the wide.
spread idea that for one reason
or another business activity will
show a large increase this fall.
Under these conditions, it is
clearly not wise to go short of
the market. And by the same
token one may we'll hold care
fully selected industrial stocks
regardless of minor recessions.
Don't buy high grade bonds.
They pay little interest and are
bound to decline eventually.
Speculative bonds may be good,
but require special skill and
analysis. Don't gamble in sill
yer stocks unless you are a
smart and active trader. Re-
member that any rise in utiIi-
ties and rails is lite.
special considerations, and
strength should be utIIizeu 70
shift into sound, we'll managed
industrial and gold mining con.
Germs which have good earn
ingS, and which afford some
chance Of OffSetting the ineH-
table decline in the purchasing
power of the dollar.