Evening star., 1938-06-19
BUSINESS FACES
| SUMMER SEASON
| |NCAUT|OUS MOOD
Retail Business Improves
Slightly With Aid of
Good Weather.
RECOVERY SIGNS SCARCE
IN HEAVY INDUSTRIES
Modest Gains Recorded by Motor,
Steel and Power Outputs,
and Freight Loadings.
By THOMAS E. FLANAGAN,
Associated Press Financial Writer.

By THOMAS E. FLANAGAN,
Associated Press Financial Writer.
Business approached the threshold
OF the summer season cautiously in
the week just ended
Retail trade did q little better with
the aid Of improved weather, but the
Commerce Department had this to
say:
1T would be going too far to say
that Improvements were based on
better fundamental conditions, as the
larger activities seemed to be en-
tirely seasonal"
Modest gains were recorded for mo-
tor and steel production, electric
power output and carloadings, but
advances in the latter two represented
upturns over the preceding holiday
week when operations slackened.
Business found little encouragement
In the heavy industries. For in
stance. demand for steel remained
skimpy. Steel trade circles said that
they saw no buying for inventory and
that the pace of orders was slower
than both April and May. Contracts
for structural steel work braced up a
little but buying was mainly for Gov-
ernment projects.
Sloan Is Gloomy.
A footnote on the outlook for the
motor industry was provided by Al
fred p. Sloan. chief executive Of Gen.
eral Motors Corp. He wrote stock
holders: 1T is dificult to see how the
automotive industry in the immediate
future can contribute anything to
the national economy by way of IN
creasing employment"
Gloom settled down over the rail-
roads when Congress adjourned with
out Offering tangible hopes for solving
their problems. The Association Of
American Railroads reported rail op-
Grating revenues down 222 per cent
from May last year. Experts said some
systems already have scraped the bot
tom Of the till to meet interest pay
ments and that they were approaching
dangerously near the verge of bank
ruptcy. -
The machine tool industry usually
provides . barometer Of the hopes or
fears Of manufacturers. During the
week the National Machine Tool
Builders Association reported its index
had slumped to 66.7 in May from 903
in April. It said nearly half Of the
business continued to find its way into
export channels.
Financing Dries Up.
Although the stream Of capital
financing virtually dried up during
the week, business and financial circles
saw one bright spot. This was the
registration with the Securities Com
mission of an $s5. .oO0, 900 bond issue
by the Standard Oil Co. of New Jersey.
1t represented the second largest piece
of financing in several years. Some
observers said the decision to issue
securities had been prompted by the
recent successful offering Of 500 ,000,-
900 of bonds by U. S. Steel Corp. While
the promised new issue reflected robust
investor demand. business circles still
bemoaned the fact that stock financing
for new enterprise has thus far failed
to appear.
Divergent price trends arrested at
tention of businessmen during the
week. Scrap copper and some steel
prices declined. Other raw commodity
prices on the average improved some-
what but the rise, which was led by
wheat, lost some Of its force at the
week end.
On the course of prices-particu-
larly those Of heavy industry-de-
pends part Of the answer to business
trends in coming months, experts
said They noted that Thurman w.
Arnold, Assistant Attorney General OF
the United States told Detroit busi-
ness men that high prices. artificially
maintained, have been retarding pro-
duction. Meanwhile preparations got
under way for completing the list OF
those who will survey monopoly prob
lens for the Government.
Steel Rate Advances.
Steel production gained to 27.1 per
cent Of capacity from 26.2 the pre-
vious week, the American Iron &
Steel Institute reported. A month ago
it was 30.7. year ago, 76.6. Wards
reported motor output at Alto. A
week ago 1t was 40,175 and Ill $40 in
the like 1887 week.
In the week ended June II, the As
sociation of American Railroads re-
ported, freight carloadings totaled
| 553,854, an increase of 10.2 per cent
over the previous week which included
the Memorial Day holiday. The total
was 26.2 per cent under the like week
. year ago. In the same week elec-
tricity output totalled 1891, ,787, 900
kilowatt hours, the Edison Electric
Institute said. This was q small gain
over the previous week. but 10 per
cent under the like 1897 period.
The Associated Press index Of in
dustrial activity rose 67.4 from 66.7
the previous week and compared with
104.5 last year.
The Commerce Department said
practically all cities reported retail
gain over the previous week. The
margin Of decline from the like 1897
week was narrowed by about q per
cent. Part of this decrease in dollar
volume was attributable to lower
prices.
Wholesale trade held about steady
at levels Of recent weeks, with re-
tailers still following . very cautious
buying policy"
4, ALUMINIUM USED.