Year: 1870

Both matters had important influences In afect
ing the course OF prices In governments, stocks and
gold. rhe earliest movement was In the
Gold Room, where the opening sales took
place at 112H under the newspaper re-
ports this morning Of the critical situation
OF France and Prussia regarding the question Of the
succession to the Spanish throne. As the forenoon
advanced the foreign bankers were free Sellers and
broke the price TO 1l1H AS suspected at the time,
and was afterwards demonstrated, they had been In
receipt OF early cable kilograms from Europe re-
porting much better feeling at the Paris Bourse
where rentes advanced on the anticipation that
diplomacy would settle the questions In dispute
without resort TO the sword.


THE GOLD MARKET


was very feverish, however, and gave way obst
nately, the general impression existing that affairs
could not have assumed SO pacific character on so
short notice. Moreover, the latest report from the
Bureau OF Statistics at Washington giving the ap-
proximate results Of our foreign trade for the fiscal
year ending June 80, 1870, was not OF character
to discourage the holders Of gold and hence
the bulsh feeling was not easily dissi-
pated The bears however, pointed to
the comparatively trinlng advance which
gold had made on important news as that of
probable between the great European Powers,
ana instanced il proof OF the inherent weakness
OF the market. As to the effect OF such war opin
ion is greatly divided, some maintaining that It
would lead to very sharp rise in gold, owing, for
one reason to the sending home OF our fye-twen-
ties. Others, however, sanguinc that In such
emergency our 1ye-twenties would eventually i'm
prove in the foreign market, whatever their
nrst tendency, as shown In their decline
in London today to eo1s against 81 few days since
might be- and that the heavy shipments of produce
and provisions to the warning nations would keep
U0ld froi nd van hpra hor ia no doub hat
in the event Of such war America would largely
profit by her shipments OF produce ana provisions,
prices for which would or course advance so or 100
per cent IN the foreign markets. Finally the pas
sage Of the Currency bill Ia its latest form was inter-
preted as contraction, and gold declined TO i114,
al which II closed.


STOCKS STRONG AT THE CLOSE.


The independence of each other or the gold and
stock markets was again curiOusy manifested to-
day. In the forenoon, when gold was highest there
was semi-panic IN the stock market ana prices
sharply declined. Later in the day gold declined,
when stocks advanced On the first nush OF the
that the Currency bill had finally passed both
went down together but in the latest dealings they
again parted company, gold continuing TO 90 down
stocks rose again The early decline In stocks was
due to the announcement OF an Injunction against
the Lake shore and New York Central railways.
When, later, 1t was discovered that the Injunction
was but partial and OF really little importance, stocks
bounded mp quite sharply and became steady and
strong continuing so at the last board and until the
passage Of the Currency bill was positively an
nounced, when The market became heavy, and prices
fell of about quarter per cent Here q
feeling seemed to take possession OF the street
that Congress mad now done its worst, and that as
the House conference committee on the Funding
bill were strongly opposed 10 the original Senate bill





The consequence was a strong reaction, and in the
thin market on the street. after the closing OF the
Long Room, prices advanced to the best of tho day.
The views Of Wall street concerning the Currency
bill in It's form as passed very conflicting The
measure is OF itself highly calculated TO excite very
diverse opinions AS far rs we are In possession of its
details as 1t goes to the President for his signature
II seems that no specific provision is made for the
manner In which the fory-ive millions Of three per
cents shall be cancelled. In the absence OF any Iii.
rect information on this point we are left to infer
that the Secretary OF the Treasury must use his
currency balance and II necessary his sales
OF gold, IIO procure the requisite currency in
order TO retire the certificates. In this
view OF the matter the bill proposes
violent contraction, for the three per cents count as
reserve IN the banks to the extent OF three.fts of
their amOunt Hence the first effect Is a contraction
OF ~ millions. In the next place, the issue
OF 81 millions Of national bank currency will require
reserve OF Is TO 25 per cent the greenback
circulation viii be diminished from eight
to thirteen millions, making a total contraction OF
thirty-hve TO forty millions, to which should be
added the disturbance OF the money market by the
redistribution OF twenty-five millions or the banking
capital OF the Eastern and Middle States.


GOVERNMENTS HEAVY AND LOWER.


The decline IN tye-twenties abroad and the decline
In gold here had rendered the government market
heavy in dealings before the receipt OF the news con-
corning the Currency bill On the publication OF the
ater there further decline, for the reason that
the street sprang to the conclusion that the Secre-
rary OF the Treasury in being compelled to use all
his currency to retire the three per cents
would be under the necessity Of disseminating
his purchases Of bonds beyond the amount
requisite to keep in force the operation
Of the sinking fund law. On the other hand 1t was
argued (and 1t was this second thought OF the street
which helped the stock market at the close as just
narrated) that the organization OF new banks under
the law, as just enacted, would be slow ana grad
ua process, ana hence The operation OF
the law would have only remote effect,
while as fast as the three per cents
were retired the projectors Of the new
banks would have 10 come TO New York and buy
bonds Tins supplying money TO the street as fast as
drawn out by the secretary Of the Treasury. AS to
the ultimate effect Oh government bonds it evil
dent according 10 these theorists) that the new
banks would require s5I,oooooo 10 deposit against
their $54 100000 oI currency and that they would
thus supply marketf for governments should the Sec
retary be compelled to cease his purchases. Despite
these arguments The government list did not react
as did the stock market and prices closed steady at
the lower range OF quotations. The government
bought million OF bonds to-day for the sinking
fund.- In pursuance Of the July programme, the oner
blgs at the Sub-Treasury amounting lo nearly five
millions, fact which, doubtless contributed TO rem
der The market weak.


SOUTHERN SECURITIES DULL. a.


In the southern state bonds the Tennessees were
strong and higher, and the North Carollnas lower
The agent in this city OF the State OF South Carolina
received proposals for the sale OF bonds to the
sinking fund. The accepted lots Were mostly or The
isaun Of 1917 Ixhich