Tabell’s Market Letter – September 22, 1950

,,' Walston.Hoffman (\ Goodwin 5 NEW YORK 5. N. y, 3S Wall Street DIGBY' 4-4141 PHILADELPHIA 2. PA 1420 Walnut Street PENNYPACKER 5;977 TABELL'S MARkET LEnER ' LOS ANGELES 13, CALIF 550 South Spring Street MADISON 91m SAN FRANCISCO 4. CALIF, 265 Montgomery Street SUTTER 1.2700 , , In June, 1949, this letter recommended the purchase of stocks in the 165-160 area of the industrial average. The low was 160.62. Later it was .. stated that the upside obJective for the advance was a minimu.'ll of 225 and a maximum of 240-250. In June, 1950, the average reached a high of 229.20. 'Then followed Korea. We again advised purchase of selected issues in the , 205-195 area. The low in July, 1950 was 195.40. The market has now, in a , little over two months, regained almost the entire decline. Friday's high ,was 228.17. At this stage, I would advise caution in following the advance. It is possible that the'maximum objective of 240-250 may be approached, but', 'I would rather doubt it. The market entered overbought territory on August' 24th when the average reached 222.17. At that time we suggested lightening , intermediate term accounts 50 while continuing complete retention of long term holdings. Would continue to follow the same procedure. The market appears to have enough momentum ta hold in the broad 230-220 area for a , little further time and special situations may have moves of their own. I , 'trading accounts, some advantageous switches might be made in order to take 'advantage of such special situations,provided 50 of funds remain liquid. ,,' Below is a review of some of the issues in my recommended list. ALUMINUM CO.OF AMERICA was recommended in late February at 55, so it , is now,a long term holding. The last sale was 71 3/4. The original object- ive was 70-75. Seems high enough at the moment. ! CALIFORNIA PACKING was originally recommended at 36. The technical , pattern indicated an advance to 52-55. The recent high was 52. Is near its obje'ctive. ', INTERNATIONAL MINERALS f, CHEMICAL. Originally recommended at 25 and 'again in July at around 35-37. Last sale was 49 3/4. The longer term pat- ,'tern still indicates higher levels at 60-65. Would buy on declines. LOWENSTEIN & CO. This issue has been conSistently recommended in the '20-25 range. Last sale was 38 1/8. Recent advance has been rapid but longer, term indication is 50-55 on present stock. Declared 25 stock dividend this week. Buy on price declines. MISSOURI-KANSAS-TEXAS, PFD. Originally recommended at 26. The stock 'has a very bullish long t8rm pattern and indicates much higher levels. However, at Friday's high of 39 1/4, the stock was just below the upside supply at 40-50 and may need some technical correction before the advance ,is resumed. Buy on dips., PACIFIC MILLS was recommended late in May at 30. Thursday's high was 47. The advance has been rapid but the intermediate term objective is 50-56 and the longer tern objective is even higher. Would not follow . strength at this stage but would add to holdings on price declines. , REYNOLDe METALS has conSistently been recommended in the 10\1 20s. ',Recent high was 32 3/4. There is some supply of stock around present levels that temporarily may hold Qack the stock but long term indications are much ,higher. Buy on declines or on ability to reach 33. ' SCHENLEY INDU3'rRIES was one of favored purchases early this year when it \'fas selling at around the equivalent of 24 for the present stock. Last 'sale was 33. While some consolidation may be needed, highet levels are ul- timately indicated. The objective is 45-50. Buy during periods of market weakness; SEABOARD AIRLINE. This has been one of our favored rails. Stock was originally r,ecommended at 15 and again at 22. Recent high was 39 3/8. At that level it had over-reached its intermediate term objective of 37 and may need some consolidation to form a new pattern. WESTERN UNION originally was recommended at 26 in May wher, it broke out on the upside of a long accumulation area. At that time it was stated that the objective was 0-)5 where a heavy supply of stock would be met. At Friday's high of 41 7/B, this objective has been approximated. Closing Averages Dow-Jones Ind. -,26.64 Dow-Jones Rails – 67.90 EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN September 22, 1950 This memorandum is not to b. construed 1111 an offer or solicitation of offe,.. to buy or sell any ,ecurltlos. From time to lime Waldon, Hoffman & Goodwln may hay. an Int….lt in lome ot all of the securlthll mentioned herein, the foregoln9 matl!rial has been prepared by us a1 a matter of information only, It is based ut!on Information believed liable but not neceuarlly compl.t., Is not Guaranteed lIS accurate or final, and i, not Intended to foredose Indopendent inquiry. . ;… \' .,… -. – ……