Business & Finance: Nervousness

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The first upset in the post-election bull market came last week over a matter of $3. Sir Joseph Flavelle, head of the Canadian Marconi Co., a Canadian radio stock listed on the New York Curb, announced that $3 was too high a price for Canadian Marconi shares. Inasmuch as Canadian Marconi was being quoted at $27, Sir Joseph's tow Opinion of -the stock shocked Marconi speculators. Dropping perpendicularly at a speed that left the ticker far behind, Canadian Marconi dove to 15½ before trading in it was suspended. The stock had been riding on a rumor that Radio Corp. of America was planning to absorb Canadian Marconi. Sir Joseph's $3 estimate virtually flattened this story; thus the bottom dropped out of Marconi. Upon resumption of trading, Canadian Marconi continued to decline. It reopened at n|, dropped to 8½.

When news of the Marconi collapse spread to the Stock Exchange floor, a selling movement produced sharp declines in several of the favorite dull issues. The advance of call money from 8 to 10%, and the anticipation of large increases in loans to brokers also helped unsettle the market. Radio Corp. of America dropped more than 12 points, Montgomery Ward, Sears Roebuck, Wright Aero, Victor Talking Machine, Packard Motor and many another stock declined from 5 to 15 points. Other slumping stocks also began to climb back, the market finally re-asserting its prevailing bullish trend. Observers pointed out that there was no real relation between the Marconi crash and the weakening of the entire Exchange board, attributed the decline to "market nervousness."