Tabell’s Market Letter – May 01, 1953

————————– Walston &Co. .. 7(M,jIJ.J1/nt 8aulu/teJ.- ………..MEMBERS-mWYORrc..-ST6(f-iEXiMA''E..;;i,EAO'tNG SlO AN COMMODITY EXCHANGES NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO LUGANO (Sw …landJ OFFICES COAST TO COAST CONNECTEi BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LETTER It appears probable that the market.has completed its intermediate term decline at last week's lows of 269.25 on the Dow-Jones industrials and ,101.02 on the rails. These levelS apprpximate my suggested buying areas of ,275-270 and 103-100. In the last two years, the industrial average has had twelve moves of mope than 5. Six have been on the upside and six on the downside. Their approximate scope and dates are .listed below ADVANCES LOW .. 223 242 241 255 255 263 DATE December, 1950 March, 1951 June, 1951 November, 1951 May, 1952 October, 1952 HIGH 257 264 277 276 281 295 February-D, AT1-E951 May, 1951 September, 1951 January, 1952 August, 1952 January, 1953 plus 44 plus 22 plus 36 plus 21 plus 26 plus 35 HIGH 257 . 264 277 276 281 295 DATE February, 1951 May, 1951 September, 1951 January, 1952 August, 1952 January, 1953 DECLINES LOW DATE 242 March, -r951 241 June, 1951 255 November, 1951 255 May, 1952 263 October, 1952 270 April, 1953 minus 13 m.inus 23 minus 22 minus 21 minus 18 minus 25 The rail average has had a similar series of swings although the scope and dates have been somewhat different than that of the industrials. It appears that the recent decline was just another of the series of con- soJidating swings of the past two years or more. During this period,individual issues have not followed the general market pattern. The cloSing price level on December 31, 1951 was approxi- mately 269. Fifteen months later, at last Friday's lows, the industrial ave-rage was about the same level. Individual issues on the same date showed E. quite different pattern. For example, in the same period of tim.e.z. Carrier Cororation advanced from 23 to 40, Seaboard Air Line from 70 to 100, South- error Railway from 51 to 84 and Clark Equipment.. from. 29 to 40. However, the '('act that the industrial average was approximately unchanged after fifteen moths was of little solace to the investor who bought on the last day of 19,1, such stocks as Commercial Solvents at 31 and-now 19, National DistilJers at 34 and now 19, Cerro de Pasco at 54 and now 28,,,Celanese at 52 and no'\' 28 or Abbott Laboratories at 59 and now 42. I expect this selective action to continue in 1953 with moves in both directions by both the averages and individual stocks. I do not expect 19,3 to be a bull or a bear year, but rather a combination of both with private bull and bear markets in individual securities. In my last two letters, I published a list of recommended issues for both investment and capital appreciation accountS. I believe these issues 'will show above average action and should e bought on weakness. Listed below are a number of issues that I believe will show below average action and should be sold on strength American Car & Fdry. American Cyanamid American Metal Atlantic Refining Beechnut Packing Bohn Allliinum Bullard Cities Service Cluett Peabody Continental Oil Corning Glass Deere & Co. Dow Chemical Firestone Tire Food Machinery Grumman Air. Goodrich Holly Sugar Lee Rubber Mathieson Chern. Mid-Cont.Petroleum Monsanto Chemical OwenS Corning Stand.Oil of Indiana Texas Co. United Carbon United Fruit U. S. & Foreign Sec. White Motor May 1, 1953 EDMUND W. TABELL WALSTON & CO. This memorandum is not to be construed as an offer Of olic;,ttion of offen to buy or silli lny SlIcunt,es From time to time Waldon & Co. or any pa.rtner thereof, may have an Interest in some or all of the securities mentioned herein The foregoing material has been prepared by us a5 a matter of information only It IS based upon informahon beheved reliable but not neceuarlly comDlete, is not guarClnteed as accurate or final, and is not Intended to foreclose independent Inquiry