Wall Street: One Hectic Week

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Still, sanguinity among businessmen was by no means universal. Steelmen, who had been battered into line by Jack Kennedy not to raise prices, conceded that they now have cut some. Their industry is producing at only 55% of capacity, and they have revised their output estimates from 110 million tons this year down to 100 million tons. Steel is not the only soft spot in the economy. The Commerce Department said last week that twelve of its 29 "leading indicators" are trending downward.

Hopes & Growls. Concerned as they might be about the future of the economy, millions of Americans for the moment were considerably more concerned about what was going to happen to their stocks.

The majority of market analysts do not see much of an ebullient rise ahead for stocks, but neither do they expect much more of a fall. "We're near the bottom now," says Shearson, Hammill's Maynard.

"The market has been going down for so long that there are a lot of good values around." William Coburn Jr. of Boston's W. H. Coburn & Co. was operating on the theory that "the more blues the investors sing, the closer we are to bottoming out." As of last week, most analysts were forecasting—or at least hoping—that the market will rally somewhere between 585 and 600, then slowly climb back. But it is only half in jest that Wall Streeters warn that when almost all of them agree on something, they are likely to be wrong.

And there were a few notable bearish growls. Walstorrs Tabell, who last August predicted the current selloff, now looks for a slow, two-stage climb back to about 750 on the Dow-Jones index—and then a slump of even greater severity than the present one. Los Angeles Investment Counselor Richard Ney, who once played Greer Carson's son in Mrs. Miniver and later married her, has been blatantly bearish most of the time since last October.

That stance makes him as popular with his clients now as he was unpopular then.

He predicts that the decline will drag on another two months, probably drifting down to 570 on the Dow-Jones. "I try to discourage investors from buying market leaders as they hit new highs," he says. "Too often the highs are death rattles. The really sophisticated investors are liquidating at each rally." Most impressive argument offered by the bears to support their position lay in the hard-won new realism of ordinary investors about growth and the price-earnings ratio. From now on, says Bache's Gordon, "prices of stocks will not increase unless we can really see proof of growth in earnings." Only slightly less pessimistically, E. F. Hutton & Co. Partner Robert Stovall warns: "You don't heal a blast wound with a Band-Aid, and you don't convince people to put money back into the market right after they have sustained sizable losses."