The Washington times., 1935-11-04
CLIMAX SEEN
FOR MARKET BEFORE
SEVERE REACTION
By LEWIS HANEY

Professor of Economics, New YORK university
Refectnp the general u industry trade and commodity
markets asde from automobiles and quor the stock market
made little progress last week The averages were practically
ages fractonaly higher
averaged slightly lower at the end OF the week than
at the beginning
The total volume OF trading was cOnsderaO Saer thdh IN
the preceding week
Evidently large traders still hesitating.
y
t. true that the most active stocks continued to
which But there reguariy In this respect
Among the most active issues were several automobile stocks
which ground during the week. including Chryser COlum
bia Gas & Electric, and Radio gave up some ground
But General Motors forged ahead considerable group OF
utility stocks traded in large volume at higher prices
and Kennecott Copper led active strength in the metals
Toward the end of the week the active strength
in the alcohol and liquor issues metals and few
railway issues while utilities and motors lost little ground IN
rather heavy trading.
Clearly the market hestant. In the last hour
trading both Friday and Saturday. prices halted and re-
acted little larger volumes Some lack of bids was ap
parent in Allied Chemicals, American Can and number OF
utilities The stees after show Of strength Thursday
failed to follow through, and reacted instead
continue to advise keeping on the leading steel
stocks If industry continue expansion, including the
industry the steel industry must join in In that
the steel stocks should participate in the bu market But
as yet T. s. Steel sticks A. compared with the high for
the year of 1874 and Bethlehem makes similar showing
In general the market is knocking at the upper level
touched week ago Friday But the railway stocks
group tagging The utilities turned weaker toward the
end of the week. And the mdusrals have become more
mixed and 'selective"
My general feeling about the situation is that the chances
favor something of climax than has yet been
that reaction is likely until after another little
runup and larger volume.
But believe that larger "publc following" is develop
ing and that the so-caled technical position getting
yedy In other Words good shake out' would ordinarily
be required to enable the market to go ahead much
that gaps occurred two weeks ago. Since the
acting of the market subsequently has not yet indicated these
to be "break away gaps marking the beginning of
upsurg the possibility that the averages have
drop back couple of points order to good start by
inducing large operators to take hold again.
1t to that the cautious attitude of the big fellows
has been persistent that they would be likely to sell
good bulge At the time doubt if public participation
is large enough to tide through such selling.
remains my opinion that eventually higher prices are to
be seenthat eventually bigger and better initiation will
develop
The present abnormally high prices of stocks
pared with earnings is, think, foretase of what may be
expected in many equally good but less prominent
would therefore, not disturb my holdings of stocks which
much or per cent present prices which
have definite nearby probability of such earnings would
welcome reaction in order to buy But would he
tate to buy most stocks just at the moment pending the
of all the motor balyhoo and action of leading steel
stocks.