STATE OF BUSINESS: A Little Bounce

For weeks the Wall Street bullshave been impatiently waiting for the market’s traditional “summer rise.” Last week, after two listless, post-holiday trading sessions the market bounced upward 4.52 points on the Dow-Jones industrial average for the biggest gain in a month, closed out the week up another 2.02, at 646.91. Whether or not this little bounce would prove the beginning of the summer rise, the surprising and heartening factor in the market’s advance was that steels led the way. For the week, U.S. Steel rose 3¼, and Jones & Laughlin, Lukens and Youngstown Sheet & Tube all rose between 2 and 3.

With the nation’s steel mills operating at only 42.7% capacity, the lowest non-strike level since 1958, investors were clearly buying steels on the assumption that the low point has been reached and an upturn in production lies ahead. At week’s end the Commerce Department reported that exports of steel rose to 320,0000 tons in May, exceeding steel imports for the first time in 18 months. Steel imports, which got their big boost during the steel strike scare, fell to 272,000 tons, a figure that Big Steel Chairman Roger Blough describes as “still very bothersome,” though it is only about 3% of U.S. steel use.

Automaker stocks also moved up in the stock market, and with some reason. Though some middle-priced cars were not selling well, Chevrolet rang up its best June ever, with sales of 190,215 cars, up 8.5% over June a year ago. Chevrolet six-month sales in 1960 also set an alltime record, up 16.5% over last year. June Rambler sales were up 11% over June last year; Plymouth Valiant sales for the first six months were 18% ahead of the first half of 1959, with the new Valiant accounting for 40% of the volume.