Evening star., 1939-01-08
Sharp Rebound
In Steel Hailed
AsGood Sign
Other Industries and
RetuiI Trade Hold
Moderate Coins
BY THOMAS E. FLANAGAN,
Associated Press Financial Writer.

|
| Associated Press Financial Writer. .
Steel, the wheel horse of industry.
celebrated the arrival Of q new busi-
ness year with show Of strength
this week.
With the aid of orders from the
construction and railroad indus
tries, steel rebounded briskly from
its usual year-end holiday lapse.
Statistics on other leading indus
tries and retail trade showed mod
crate gains over last year. Com
parsons with the previous week
were made difficult because of holi-
day interruptions.
Steel's vitality had several sources.
Demand by railroads Skidded to
around record lows during 1898, but
as the week closed the record of
railroad orders for equipment was
heartening.
Rail Orders Placed.
Northern Pacific placed an order
for 10000 tons of rails. Chesapeake
e. Ohio came into the market for
track accessories to 60 with the
$4,000 tons of rails it recently or
dered. Meanwhile, Iron Age said
Canadian roads will spend more
than $50, 0,OO0, 900 for new equipment.
This small squirt in railroad buy
ing" the survey said, lis only a
sample of the replenishments that
the railroads will find it necessary
to make in 1899. The solvent roads,
whose earnings have lately been in
creaSing, may soon be in position
to make larger expenditures with
out Federal aid"
The construction industry's TAX
ings of steel were explained in trade
circles in terms of both steady Gov
ernment spending and stable gains
over year ago in the flow of pri-
vate dollars into new building op-
erations. At the same time steel
circles were encouraged by the wide
variety of orders from miscellaneous
quarters.
Budget Reaction Mixed.
Businessmen greeted with mixed
feelings the Presidents budget mes
sage. 1t was generally agreed that
continued Government spending at
a high level would sluice fresh or
ders through trade and industria,
channels. On the other hand, many
repeated their oft-expressed opinions
that business cannot count indefi-
nitely on the hypodermic of Federal
spending of borrowed money.
Although they were left in the
dark on many important points,
businessmen who have opposed the
appointment of Harry L. Hopkins as
Secretary Of Commerce got a scrap
Of comfort from his first press con-
ference. He said he was seeking the
advice of businessmen before chart
ing his course in his new job.
The general let-down apparent in
both trade and industrial sectors
was accepted by analysts as normal
behavior. 1t was recalled that the
climb of the past six months has
been speedier than any other for a
recent like period.
Inventories Curtailed.
While this in itself was seen as a
partial reason for some slackenins.
the experts emphasized that theg,
have as yet seen no signs Of un-
favorable trade winds. inventories
have not been allowed to expanh
excessively. Commodity markets
have shown no signs of unhealthy
speculation and merchants have
bought ahead for 1899 with caution.
Meanwhile, security markets have
kept relatively stable and bank loans
have not swelled.
The following news during the
week was listed on the asset side
OF the business ledger: Sears
Roebuck reported December sales
at a peak never before reached,
Bank clearings were nearly 10 per
cent ahead of year ago. Forward
buying in the building supply and
industrial electrical fields was good
Wholesale demand for spring goods
In leading centers was brisk. Pro-
duction executives predicted a good
year for the motor industry.
Liabilities Listed.
Among liabilities were these: New
financing dropped. Bituminous coal
output slumped. Department stores
in some leading cities reported sales
below expectations.
In its review of business in SO
cities the Commerce Department
said: I'm line with the usual post
holiday trend, business generally
was relatively quiet during the open
ing days of the new year.
Retail and wholesale trade con-
tlnued on encouraging levels, with
inventories in much better shape
than at this time last year.
practically all cities reported
their retail trade for the week on a
par or nominally ahead of last
years comparative, and decrease,
where shown were small. It wa,
generally noted that sales were bet.
ter in the moderate price field thar
In the luxury group
Weekly Trends Reviewed.
The week brought forth these
statistics:
The American Iron and Steel
Institute reported production of
steel at 5o.7 per cent of capacity,
compared with 1873 per cent the
previous week, 500 month ago and
25.6 a year ago.
Electricity output, reported by the
Edison Electric Institute. totaled
2,12O,555 900 kilowatt hours, some
what lower than the preceding week.
but 81 per cent above the like 1898
week.
The Association Of American Rail-
roads reported freight carloadinps
at 499. 1896, drop of 13 per cent from
the previous week and 90 per cent
better than last year.
Wards Automotive Reports said
production Of automobiles totaled
1885 units, compared with 75,215
the week before and 54084 in the
like week year ago.