Tabell’s Market Letter – July 06, 1951

,i,T1'''–',-''J;g,;;a'-';r,;, WoIston. Hoffn1on &Goodwin 7–';''Cii.'ii',,-q'!i.7rt1';1;)1; Qkht;,'j' W'4M;um ec, 1;' 117 /)) NEW YORK 5, N, y, 35 Wo!IlI Sheet I'1l.\J DIGBY 4-4141 PHILADELPHIA 2, PA 1420 Walnut Street PENNYPACKER 55971 LOS ANGELES 13, CALIF, SAN FRANCISCO 4, CALIF, 550 South Spring Street 265 Montgomery Street MADISON 93232 SUTTER 12700 fill IiINl,I' ,M TABELL'S MARKET LmER II,IM, 1it I,.I, ;/ IllI;I/ '1,/17 f/I iY,,,I o Ir, , L.,.J 'i I,l; I),; 1,,7' ',i! Both averag'es recovedre s harp 1y f rom the June 29th lows of 240.72 I1U(j1.i'1l WH and 71. 'r8 to reach intra-days highsdf 251. 30 and 76 ;27 This rapid re- ,i k,1 covery on small'volume has' again weakened the near term techhical pattern 1;1/11. ',';,','1 and the short term indIcator has' agaTn enteredoverbbught territory. ;(;1 This,' plus' the 'fac't that there is heavy overhead supply at 250-255 and at f!,'li (t! 76-78, leads to the probability that therewiiH; be ano.ther tes Ging oL the June 29th lows. The next support point in the industrial average is at filii, 235-232 followed by 225-220, The rail average should meet strong support ),,; at 70. j As mentioned last week, all stocks will' not make their lows at the' ift;'tl !i; f,'q, tH, sam sho e u l ti d e be . Ther purch e a s are ed o is n sues mino with r wea stron kness g d ,long' espite t erm the technical fact that patterns 'ch,at the avera;es 1'1; and numerous individual issues with weak technical patterns iildicate lv1'Jh,r,,,,t'; !'; lower levels. I');; ;1, There seldom has been a time when various segments of the marke c .have 1M t)!,,'1. moved as independently of each other as they are doing Goday. The' three, lists below illustrates this poInt. The yields are based on June 29th ;;1 \;!, li f' prices and the total dividen.ds paid in 1950. , I, ,'d Superior Oil LOO 1ucyrus Erie 10.00 fi',lTexas & Pac.Land 1082 P'i-ramount 1 ' 8.30 i'IMinnesota Mining 2.26 Commercial, Credit 914 ,-, Hudson Motor Cont. Steel Chrysler r1r6.'.5862r,',4JI) -11 4 '2886 f4 Merck&Co. 2.35 Hall Printing 8.89 Pat1noMines.. . iillr i;Pfizer,(Chas.) 2.40 Nat'lo Supply 8.38 South P.R.Sugar 1301 l I;-'Corning Glass 3.01 Fruehauf 7.92, Amer;'.Wpolen ,' 1300b it j'Amerada Pete. 3003 Armstrong 6.94 Gen'l,Motors, 12.94 r,; ;; n 'IU11i, Mo n s anto The Chem. stocks 3.36 in the Sylvania 6.72 Motor first classification' are th'growth Wheel 12.60 sit'atios. '\li,l 'i o/,; Immediate yield is of minor importance' t-o- the long term investor who is 'i t'L;li purchasing have shown growth in excellent a company over a period of years. Stocks of this type market action and have been the favorites of insti- (;i 11', tutional buyers and weal thy investors. The important question is ',whether, !I,,, 1.8 at resent levels, they have not too liberally discounted their favorable f, II,I grmtn pattern. , (,j1,' The shade or second list comprises companies that, in the main, are so below the higher grade investment, category. Even if just a business ;i; f,! ;,;,' should decline moderately, present dividends .on these issues appear rel- ,1,/,talve1Y,secure. , 1- .,1' I' I.;!\ The companies in the third claSSification are mainly in cyclical J,' IJ' 1)\'; i industries. The high yield indicates that there is considerable doubt as ;3,,( i! to maintanence of 1950 dividend payments. \ t It would appear that the issues in opportunity for the individual investor. the second group Yields are good present the best and, while these i issues might react moderately, a decline of more than minor importance 1J1 b' t; i.i lilt would seemingly place them on the bargain counter. It is issues ,of this ),f(,,1 Fi! type that have the strongest long term patterns on my technical work. As i;; i;;! iSSCles of the first type reach price levels that fully discount favorable gp, Vi long term prospects, buying might 'edge down into issues of slightly lower I'!' i,'! investment calibre. ig I,,1',,1I1 l'/jlI'r,!l/. Ii July 6, 1951. ' , tl', f!!i\- 'C'-l' .. –. A',', -p, ..' '..,., ,-, , , -EDMB'ND HTOllliF'FEMATiTJ & 'GOODW''I'N'i;–',,(,',,! r;)1 oSl.ng verages . WALSTON, N I 'I, ;il1!,,)'./j!' Dow-Jones Ind c 50.01 Dow-Jones 'Rails 75. 72 i,i ) 111\ 1'-)''i''', f ','I x;, i1. '. ' . 'z't' /.fi/II',!!171i !.ll Ttlh memorandum Is not to be contru.d a. an off'lr or solicitation of ofhrs to buy or II any securitl.s. From tIm. to time Wahloll, Hoffman I Goodwin may hllv. an Interut In 10m. or all of the securiti.s mentioned her.ln. Th. for.goln9 material has been prepared by u. a. a matter of Informatloll only. Jt Is based upon information b.II….d r.llable but not neCluarily complete, I. not ;uaranteed oil accurat. or final, and Is IIOt Intended to foreclose Independent Inquiry. M' ft-trl;yt 1VN!!.;;ft,'Ci.(-t1rr;!!'lZ;;;;–7!ylJ;;'i.!,–0.'-'(IJ;–/ –', – 'f'/; ;'-l.;.J; -!;s;,''fi!!Fi(l7,-jjt'5'i!j!jY1if!J,ff!!Jt!;-.J.;(,rl'Y.17ff!1'Lb/J