Evening star., 1949-08-21
Stock Market Scores
Advance for Ninth
Straight Week
By Roder Winget

BY koder WIn9et
Asseeiatsd Press Einoneiol Writer
NEW YORK, Aug. 20.-It was a
tight squeeze, but the stock market
this week ended higher for the
ninth straight week of the summer
rally.
The net gain was the smallest
for any of the nine weeks and at
one time the market was within
only a short distance Of the 1949
peak.
The failure of stocks to break
through the top didn't dim the
enthusiasm Of Wall Street for the
rise which has brought more than
Q dozen 1,000,000-share trading
days. After all, brokers earn
living on commissions charged for
buying or selling securities.
The rise also represents their
estimate Of the outlook for busi-
ness. In other words, they still
think business is on the upgrade
now or very shortly will be.
The head man in Wall Street,
Emil Schram. president of the New
York Stock Exchange. saw Presi-
dent Truman in the White House
and reported an improvement in
business.
What he really went to see the
President about was to ask for
changes in the tax laws that would
give q better break to the investor.
His voice was added to those of
others who recently have been ad-
vocating tax law revision.
Short Interest Studied.
There was another element pro-
3ected into the Wall Street scene
this week that created a lot of
discussion. The stock exchange
reported the short interest as of
August Is stood at 2,006,119 shares,
the greatest in about II years.
Selling stock short means bor-
rowing the stock and then selling
It with the expectation Of buying
1t back later at a lower price and
thus making a profit. Short SELL
ers believe the price of that stock
Is due to drop. Some casual OBJ
servers were alarmed that more
stock was sold in expectation of a
market decline than at any time
IN II years.
But that's not the entire ex-
PLANTATION. In order to make a
profit. shorts must buy when
prices decline, and when they buy
they are creating a demand that
cushions the fall Of the market.
A large short interest is actually
looked upon as sort of insurance
against market break.
Might Be Forced to Cover.
There is another factor. A sud-
den or sustained forward surge of
the market might well convince
shorts that they have been wrong
and they might start buying at
higher prices to cut their losses.
And again their buying would
stimulate higher prices.
Department store sales were
down Is per cent last week under
. year ago. That's not too good
but merchants-and investors
are looking for a pickup after La
for Day. All retail sales, on the
other hand. are only slightly under
. year ago and are higher than
elae previous week.
The public isn't buying right
now ut retail, but the businessman
= buying to build up his invento-
Hies against the time when the
consumer starts to spend.
The interest in gold shares
perked up late in the week with
renewal Of discussions over Bri-
eain's dollar crisis and whether
among other solutions there might
omerge . rise In the price Of gold
from the present $35 a fine ounce
ret by the United State Treasury
and used as the worlds yardstick.
The market as q whole declined
dowly Monday for the third
straight trading day, but for the
next three days 1t advanced stead
ny TO reach q new high on Thurs
day for the summer rally and the
highest point since early February.
But prodt-taking came into the
market on the final day of the
week and helped push average
prices down for . loss Of more
than half Of the previous gain.
The Associated Press average of
% stocks closed at $40, a gain of
) Of q point on the week.