The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1936-04-27


accessory and utility stock Of the nine which declined six
lost only fractions Of point Only two heavy losers
these being United States Steel and New York Central with
declines of and 3A points, respectively. '..>
This is not bad showing. .''
For the present. however caution should prevail and this
particularly true for those who specializing taking
traders attitude toward the market say this because obv
ous there uncertainties while the action OF the
market itself has not yet definitely indicated recovery
Resistance to the reaction appeared logical level
and selling has ghtend but buoyancy has yet
developed and further correction of overbued positions
would not be surprising The average might react per
further before the market becomes reorganzed 1t is
just WELL therefore, for the trader to wait for
definitely bulsh signals
But the investor who is holding selected stocks
Of good earning and fair yields in dividends should not
At least he has better place for his money Even the
average fall to the level of January o. would not be dcon
ceng, and sounder values would not be affected
Three points that should be stressed following:
What has been going is chiefly correction of
bued positions in certain stocks Some had overdiscounted
large supuses Some had overdscounted anticipated
pg Some had just been manipulated either because they
had small number Of shares outstanding Glow
priced Now is found that being proposed
SURPRISES and holding company dividends and good many
earnings not in proportion to volume of business done
The thin markets for of the high er made it
to mark them up but they go down just as easily.
q The recent reaction just the eliminating phase of
series of reactions that have been going for quite while
Look back and you will that various groups of stocks have
had considerable reactions in the last few months Beginning
with merchandise stocks, weakness in liquor stocks
t0baccos amusements building issues railway equipments
aviation shares and motor accessories about that order
point is that these successive corrections in particular
groups issues have strengthened the technical position
that big general shakeout seems to be required.
So bull market in railway stocks is not necessary to
bull market in industrials. AS matter Of fact the rails
had big rise between March, 1885, and February this year.
But railways dominated by political control that
almost say that they the production for
service principle rather than for profits So industrial
panies make money when most railways can't.
There many uncertainties and disturbing political pos
abities Some stocks too high-as they have for
long while The rally thus far has been dull and ndecsive
But the market despite Of selling held very well
last Friday and held just at the March low Moreover
the Administration will be scattering around its prom
ses to pay while money rates cred low that many
stocks relatively cheap While people worry about
fpregn Withdrawals of funds, gold actually pouring into
the country from abroad And while earnings have
been disappointing the great majority have been definitely
higher.
Certainly no bear market is yet in sight.