Show BOND MARKET STANDS TEST Disturbance Is Small after Aft After er Business Optimism Wanes B By BYRO SELLER Special I Correspondent c ot of Standard Standard- Examiner Copyright 1926 by Consolidated Press Fresa NEW EW YORK March The Tho 2 bond market thia till week ly 11 1 withstood ase as vere test teat Stocks fluctuated widely Ith an n especial especially ly 11 b violent decline on WednesdaY and a a nervous and uncertain move move move-ment ment subsequently Money IoneY rates hardened not only day to day loans but to a slight degree derree time funds as well Doubt about the business outlook 5 11 a freely ex- ex expressed ex expressed pressed by those thos who had bad been most optimistic a month or two ago to All this could but hive have some orne effect on the securities but the th sig tit thing thine Is Ii that the th disturb disturb- disturbance disturbance disturbance ance was w 11 s so small smaiL The average 8 for tor all grades trades Is taken bonds bands have ha uttered some decline in the tha week But nut It If only the strictly Investment issues are examined it will be found that price l level cl 1 Is practically unchanged Nor does dOe the th whole story come in inthe inthe I the recorded quotations for trading on the exchange In the outside market where most of the th buying Is 1 done don for the th financial Institutions there thero has been brisk Inquiry all the week eek for seasoned securities The two group croup which have hav been In the most vigorous demand are ar the old line underlying obligations of the strongest railroads and the tho first mortgage bonds of the telephone electrIc light and gas ras companies All this gOe to show that In the opinion of o those whose business It ItIs itis itis Is to keep themselves Informed the upward turn in money early In the th week was wag only temporary Proba Proba- Probably Probably bly nt operations had a brood deal to do with the mone money flurry lurry Something of the same kind must be expected when preparations preparations are ar made for the April 1 In- In Interest Interest In Interest terest and dividend disbursements disbursement BANK XI snows SHOWS E But nothIng that has happened 11 otar orar is indIcative of o an any change In the long lone range outlook Fur Fur- Further Further ther evidence c of the release of funds from speculation was waa fur fur- furnished fur furnished by the figures on brokers loans There has lIas been some In- In Increase increase In Increase crease in demand on account of commercial needs as is normal at this Ibis season The Th consolidated of the federal reserve banks showed the decline of over overa overa a point in the reserve ratio but the e percentage of the Now New York bank is higher hither than last lut week and high hith higher hither er than at the same sam time Limo a a year ear ago II The Interest ii In first mortgage e utility bonds was stimulated b by the prospect of amending the Uie hew lew NewYork York state slate law to Include certIn of these ioan loans which meet string string- ent nt requirements within the legal Investment class clus Such action It taken will wili not In any en en the Investment position of the bonds bond In question but It will tin tin- Im Improve prove JIrON their market and It will be official recognition of ot the fact tact that the best but of these ther Issues are Just as sound as ag any of ot the corresponding railroad obligations An Illustration of how large are a market factor this matter mailer of Ie Ic- Ic Ic for savings sa banks banka Is Is came the other day in tile the th sharp advance In the th New Orleans Texas TenS Mexico Mexico co Issues when they were officially declared to be legal local hold holdings InKs In this state practically As it stands now practical practical- ly the th only bonds savings sa banks banka can buy which will yield over 6 Iper per cent are ar those selling at pre pre- premiums pre premiums Discount bonds 5 Sper per cent and at ot the same time tim legal are very rare indeed NEW ISSUES GO While Ile the th Inquiry for tor the very ery best beat of railroad and utility issues sues was as as a stated strong strone all the week the same was not true tru of o anything front from the th middle grade grado crad down All such sympathized more or lees Ius l s with the decline In the stock market At the Atthe same time new lasu Issues s 's went sur- sur surprisingly surprisingly sur surprisingly welL Probably this was partly due du to the comparatively small mall volume of ot new offerings And partly due du to the fact tact that invest Invest mont ment bankers are making prices attractive The Th only foreign ISI isue ue was as a a South American loan which was wag well received The market mark ha hayet yet to demonstrate Its capacity to absorb any fresh large larce financing There was wu a complete absence of for tor seasoned foreign issue Is Issues sue sues sue all alt the th week The foreign sit sit- situation sit situation Involves eS too many points of doubt Just lust now to in- in investors In Investors estors In making new Irritation over oer the terms termo of ot the WAr debt settlement Is only one on of a number of ot disturbing symptoms oms The French financial problem I ii another It look looks a as AI though that situation was ag rapidly becoming acute with the franc down n to a record low French dollar bonds bond sold below anything recorded hith hith- hitherto hith- hith hitherto hitherto erto this year ear but at that th the loss was not large law for tor the th extreme extern range on the th Issues In has haa been onlY between three and four our points point I and andall all of them are ae are still well above i their extreme lows I pressure So Bo far tar there has been no pre pres- pres sure upon the th market for tor these iz- iz Is Issues sues which are ar apparently well distributed among Investors who see e no occasion to dispose of their th s Perhaps they are ar right for or It does doe not necessarily follow that a a collapse In th the franc frane If It It does dou collapse would alter the statu of French dollar bonds |