Evening star., 1948-07-04
Stocks Turn Upward,
End Week al Peak
Since August, 1916
BY the kssoeioted Press

by me ksSoetoted PfeSS
NEW YORK, July 3.-The stock
market recovered from one of the
worst beatings Of the year this week
and ended at a new general high
since August 1916.
Trading activity dropped to a
summer tempo, on only one day
topping 100000 shares.
Rails and oils carried the ball
most of the week, with couple of
those issues making spectacular
gains. Foreign news was watched
more closely than usual and on the
domestic side the rising price level,
with It's strong forebodings of in
flation, received close study.
BY and large, though, Wall Street
started the second half of 1948 in
q cheerful frame of mind.
The Street often figures things
out by the book-if stock prices
usually go up in the summer, for
instance, a lot of traders will plot
their market strategy on the belief
that there's good chance they'll
60 up this summer. Some traders,
too, profess to see upward tenden-
c1es In the market during presiden-
tial election years.
Helped BY Good News.
But. basically, the financial COM
munity has lot of good news to
chew on. There seems to be only
one serious threat to continued
peak production, earnings, employ
ment and income. Peak prices, un-
fortunately, show every sign of
rising still further and constitute
q major danger to industrial and
business stability.
The third round of wage increases
is under way along with another
round of price increases in foods
and industrial raw materials. Busi-
nessmen now are waiting to see
what effect the new soft coal con-
tract will have on coal and, in turn,
steel prices.
On Monday the market dropped
abruptly. Selling was not especially
heavy but supporting bids appeared
only at considerably lower prices.
Buyers, in a word, weren't much in
terested.
Foreign news was blamed ex-
clusively for the sudden timidity on
the buying side. The financial dis
trict can be highly critical of Wash
ington and 1t was in this case.
Some brokers claimed that the ad-
ministration was taking do
nothing" attitude in relations with
Russia over the problem of block
AIDED Berlin. The blast of Com
munist organization at Yugoslavia's
Marshal Tito caught the street by
surprise and created more of feel
ing of uneasiness rather than alarm
or elation.
On Tuesday prices came back .
bit although volume dropped to
three month low Some observers
thought they saw turn for the
better In the news from Berlin and
the signs of a break between Tito
and Russia held out the hope that
Yugoslavia might be moving from
East to West.
Resumed on Wednesday
The upward movement gained
momentum on Wednesday, with
rails and oils supplying the fuel.
On Thursday volume dropped to
Tuesdays slim total and the
market didn't get very far one way
or another. Oils we're offered liber-
ally late In the day following a re-
port by a Senate Interstate Com
merce subcommittee on the oil sit
uation. Senator Reed. Republican, OF
Kansas, the committees chairman,
said he hoped the industry would
avoid further price increases so
that compulsory Federal ALLEGATIONS
could be avoided.
On Friday rails and oils took over
the plotting of the market and the
average price level hit new peak
since August 1946. Rails were far
and away the favorites. Many
thought they were helped along by
the permanent strike injunction
which Federal Judge T. Alan Colds
borough issued against three rail-
road unions.
Nickel Plate Railroad common
was one Of the weeks high flyers,
ending with a net gain of 14h
points. After dropping to 1948 low
Of SO earlier this year, the stock
finished at 90 on Friday.
Nickel Plate, of course, has been
propelled forward by some Of the
factors which have helped the rail
group in general. May earnings re-
ports have mostly ranged from
satisfactory to excellent and the
prospects are that they will improve
still further.
Nickel Plate. in addition, has been
bolstered by the possibility that the
way Is being paved for a common
stock dividend. Directors plan to
clear up arrears on the preferred