Peace Boom

As good news continued to roll in from world battlefronts last week, stock traders translated it into highly selective buy & sell orders reflecting confidence in the United Nations that welled up ten days before U.S. troops set foot in North Africa. Main trend: "peace stocks" boomed, "war stocks" slumped--and hedgers' stocks (like motors), which stand to benefit from both war and peace, stayed where they were, close to the year's highs.

Since the railroads (because of their large current business and excess-profits tax credits) are huge beneficiaries of the war-production boom, their shares were the outstanding target for bears. Bulls placing bets on a prompt peace caused an almost perpendicular rise in the long-neglected bonds of conquered Europe.

On the New York Stock Exchange traders grabbed for Polish, Serbian, Czech and Danish bonds as if the reconstruction had already begun. In London the trend was even more pronounced: for -L-100-par Polish 4 1/2s the price hit 28 (almost six times their wartime low), Greek 7s went to 27 (up from a low of 8), Danish 45 to 51 (from 20). And on the day after the African invasion the Amsterdam bourse had such a flood of hopeful buying (e.g. Royal Dutch 1,000-florin par went to 361, up 100 points from the month before) that the Nazis stepped in and decreed that henceforth stock prices could not change more than 3% from the day before.

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