This is a watercolour by the Thornaby (?) artist Arthur Simpson who was capturing local scenes in the 1920s. He titled this work as “Sugar loaf ” but what he was painting is the passage which ran off the south-east corner of Thistle Green and was called called Sugarhouse Open.  This is a view from the eastern end of the passage.
The Baltic Tavern is just out of sight on the right of the scene, but next to the Tavern was a warehouse which does appear in the painting.
The wall to the left of the passage is covered in advertising posters.
This scene was also captured in the photograph which appears on Picture Stockton titled The Baltic Tavern, Stockton c1928

Details courtesy of Cliff Thornton. Image courtesy of Somerset & Wood Fine Art Ltd. www.somersetandwood.com