Show 1 1926 3 a Remarkable Year for Stock Market I I As Prices Soar Sear i in Consequence of Easy Money THE PATH OF STOCK PRICES 14 r I I 0 I 10 J 1924 1925 1926 stock prices during 1926 did the unexpected Few observers at the outset of the the year could bring them them- to hope following the hectic days of the latter part of 01 1925 that upon the price altitudes then at- at tamed could be superimposed another another an- an other twelve months of rising prices Few indeed therefore were the c early 1926 1026 expression of confidence that th the year would see prices rise except for occasional brief breaks to the dizzy heights actuallY touched 1926 was an unusual stock market market mar mar- ket year in the wake walte of an Unusual unusual un- un usual year A birdseye view of the past twelve gives a pIcture ot of a good start an abrupt reaction a second start by another although less pronounced and then a surge forward with only occasional Insignificant pauses until a grand climax was achieved only a few short days before before be- be fore th the Christmas just passed passed- a climax brought on oy ey the dramatic dramatic dra- dra matic stock dividend melon distributed by the United States Steel corporatIon This unexpected unexpected un- un expected Yuletide gift to holders of steel stock gave bull market operators operators oper- oper an opportunity to splurge their optimism In an almost unrestrained burst of prIce The Tho seventeenth seventeenth sev- sev day of was wa a fitting for an exceptional exceptional stock market year COMPARISON WITH 1925 Reviewing operations of 1926 1026 In comparison to events of the lire lire- ne ceding year three points of ence appear to stand out at once First upward movements of stocks as a whole were less consistent consistent con con- than in 1925 1025 Second tradIng while In about 4 per cent heavier volume did not appear during dui the year to be as broadly distributed In character as asin in that 1925 is is the market was more professional in a aspect Third JU 6 operations were re- re around ts 15 in specific issues rather than around groups o ot stocks Pool 01 op were numerous FUNDAMENTALS MUCH THE SAME Fundamentally however market conditions Were much the same In each of the p st two years ears Money conditions favored upward or at least firm price trends rather t d developments Business the country over was excellent and strongly supported those who played playe the upside of the market N. N Nothing Noth- Noth thing th- th ing on distant horizons in either Year ear was sufficiently gloomy gloom In its threatened effect upon economic conditions to support a prolonged bear drive and ev even n when the op- op ti tim n-cs n ft inclined t ily ra I- I out of bull ammunition as they did didat didat at times times-no developments could b- b to push stock stock prices as a i whole lo downward at a startling go ce In an accompanying chart will be seen market trends ot of the past three years years as measured by average movements Industrial issues It will be noted approached the end of 1926 striving for new high levels whereas raIl quotations after atter reaching reaching reach reach- ing a high point for the year In early September sagged and following follow follow- Ing a brief rise toward the end of October moved in a horizontal dl di- di through November and the first part of December DIFFERENCE IN MOVEMENTS Some groups of stocks during the year fared much better than did other groups A comparison o of 1925 and 1926 aver average gc values as of the of December in each rear ear shows that of fIfteen Industrial groups ten advanced In prIce during dur- dur ing the past twelve months where where- a as five tive groups actually suffered an average price decline The followIng follow follow- lag Ing table compiled from standard statistics indices shows the er- er of price increases or decreases de de- creases In different groups from the middle of December 1925 to the middle of the December just ended Pet Pct Stocks plus 66 Industrials plus 63 31 Rails RaUs plus 78 78 10 Motors plus S 8 Acc plus 11 Chain store minus 94 I 7 Chemicals plus 11 Coppers plus 80 12 Metals minus 49 49 3 Mall Mail order minus Ul 69 59 17 Petroleum minus 25 10 R. R t. t equipment plus 42 9 Ste Steels ls plus 79 6 Sugars plus 7 Tire rubber minus 7 Tobacco plus 7 74 16 Traction Gas Power plus 31 9 Foods plus and accessory stocks were easily the leaders of the market market mar mar- ket during the major part of the year in so far as group advances were concerned and although prices of these two groups ended the year at points considerably below below be- be low the 1926 high marks they were nevertheless nevertheless' fl fP above the price levels which re 0 in effect at the close of 1925 The surprising feature iea- iea ture of the sharp advances in these two groups is that the companIes concerned diu dil not as a whole report I increased profits In 1926 whereas most lInes of industry did much better than in 1925 CHAIN STORE ISSUES Chain fit stocks ks slumped lumped sharply in prIce at the beginning of the past ye year r. r and although they advanced thereafter were unable to regain the high ground of late 1925 1025 despite record earnings reported for 1926 Chemical stocks did well in 1926 1026 and recovered nicely from the early ear price breaks stocks gained steadily durIng the year metal stocks more than held their own following the 1926 winter downturn The course of mall mail order stock values during the past twelve twelvemonths twelvemonths months has been much similar to the COurse of chain store stock prices Petroleum issues for two years now now have been moving in almost a horizontal direction except except ex- ex for brief ups and downs of minor importance The recent trend has been slightly down Railroad Rail Rail- road equipment issues have been appreciating steadily since last Winter wInter and steel stocks only in I more pronounced degree have been ro lowing the same course SUGAR STOCKS LOOK UP Sugar issues which have been bumping along on low ground for several years began to show more marked improvement toward the end of the past year as a result of ofa ofa a brIghtened outlook for the in- in Perhaps the most definitely bearish trend of 1926 was evIdenced by tIre tite and rubber issues prices of stocks in this group continuing all through the year the decline which began in late 1925 Tobacco stocks already in high ground at the end of 1925 mounted mounted still higher in price during 1926 as the result of record breaking sales and profits for many companies Public utility traction issues gas and were power strong for the most part while food issues jumped sharply in value Railroad stocks av averaging them all through the list probably showed a slightly greater percentage percentage per per- appreciation In value In Inthe tie the past year than did industrials TWO TWO LEADING INFLUENCES The past year ear then vas one of remarkable price apprecIation for I some groups of stocks and one of of fair Increase in market value for formost most other groups Two Two- broad general influences roughly speaking speak speak- ing worked to push prIces upward First the country Was vas prosperous I in a business way and signs of ofa a I waning prosperity I were few and far between n. n Indeed until recently the outlook was for better rather than poorer business and even nOw opinion as to the future is divIded Second money condItions have been sound and conduciVe to rising rather than falling security values With fundamental influences as strongly favorable it was logIcal that prIces of securities should mount and that trading should be bein I In tremendous volume even though public participation appeared to be beless beless less pronounced than In 1925 After the hectic days of activity that just preceded Christmas the market is isnow isnow now now on the threshold of a new year yeara a. a year of for in looking over economic prospects which the months ahead hold in store the trend of stock prices is among the most beclouded of all possibilities HAZARDOUS TO FORECAST At the outset of 1925 expectatIons for a year ot of rising stock stock- values were few and timid but the market has its its fore fore- casters It is therefore hazardous to state that as another year comes Into vIew prices are likely to turn downward It Is inevitable inevitable however that prices time reach a peak after discounting fully all prospects for further In business I profits and dividends It is in- in evitable that security prices shall shaH some time reach a point where I Isome they are treading on dangerously high altitudes from which it would take but little little-a business turn for forthe forthe the worse a tightening in money markets almost any bit of bad news to prices over the edge of a precipice into a a. declIne When the change In trend arrIves no one knows The change will wUl not be recognized until well after atter it occurs therefore with prices at their present high levels most observers observers ob- ob servers are watching the market and outside Influences with the utmost utmost ut- ut most care It scarcely now th that t 1927 can prove prove- to be as active a year ear earon on the upside for stock values as were its two unless predecessors general business prospects take a I startling turn for tor the better On the other hand there Is nothing on the immediate horizon to indicate that bearish influences wm will soon become overwhelming |