Tabell’s Market Letter – November 23, 1956

Ir; -. NEW YORK Walston &Co. – – – – – – – – I n c . – – Members New York Stock Exchange PHILADELPHIA' LOS ANGELES SAN FRANCISCO BASLE (Sw,h.d I OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LmER November 23, 1956 As noted in last-week's letter, the breaking of the October low of 476.83 on the Dow-Jones Industrials indicated a return to 470– 460 support level. The week's low on Wednesdaywas466.16. The Indus- trial average is now near the strong support that has held on two past occasions. The May low was 463.85 and the October 1st low was Whether these two lows will again hold is, of course, a matter of con- jecture. The last signal given on my technical indicator was a sell signal on Wednesday, November 14th at 482.36. If this signal were rever- penetration occurs,it-would-be development. If the support level is broken, a decline to the 440-420 ' level would be indicated. There is a great deal of bearishness about, but I see no reason to change the prediction I made almost a year ago of market action for 1956. I expected a highly serective 1951-53-type of market ranging from a high of 520 to a low of 440-420 in the Dow-Jones Industrial average. The high so far this year was about 524 reached in April and August. The low was 458.21 reached in It is, of course, possible that the support level around the 460 level wilT hold. The acton of the market since mid-1955 has been very similar to that of 1951-1953. At that t7ime the market held in roughly an 18 trading range for about thirty-two months. So far, the present market has held since July 1955 between 524 and 433.19 (the Eisenhower heart attack low of October, 1955). This also has been roughly an 18 trading range, but for only months. If we applied the same time element that applied in 1951-1953, this trading range could continue for another fifteen or until February, 1958. Just as in 1951-1953, there will be extreme selectivity with individual issues-advancing while others are declining or consolidating. Ju1L8.S in ,951-)953, thE!re n ,'. issues on price weakness to an upside breakout of the long con- solidation period of 1955-1957. Below is my recommended list together with support levels. As several new issues have been added to the list recently, it seems advisable to eliminate a few issues that have shown below average action. The following replacements are suggested Sell C'EII'IRA.l XT'd buy either CRUCIBLE STEEL or WESTERN PAC IF IC Sell KAISER ALUMINUM and. buy EAGLE PICHER. Sell MONSANTO CHEMICAL and buy AMERICAN CYANAMID. Sell SCOTT PAPER and buy TIMKEN ROLLER BEARING. Sell WESTINGHOUSE AIR BRAKE and buy GENERAL RAILWAY SIGNAL. I am also eliminating Alleghany Corp. from the list. The amended list follows – — – Present — – Price Price Recom. Yield – Advice Allegheny Ludlum Amerada Petroleum American Cyanamid Bell & Howell Bristol Myers Calgary & Edmonton Carborundum Corp. 56 112 72 44 37 26 37 16 103 67 42 37-35 16 42-40 3.6 BUYfHold.Support 54-52. 1.8 105-95. 4.2 at-65. 2.3 .o4. 3 1,. Buy–Hold .Support BuyHold.Support 2524. 5.4 Buy-Hold.Support 37-35. -. ThIS market letter 15 lIot, and under 110 CIrcumstances IS to be construed as, an OffCl to sell or a soliCitatIOn to IJU)' .W)' secuTities I dcrrcd to herem The information contained herem 1'1 not guaranteed as to accuracy or completeness Ilnd the thl'lcr IS not, and under 110 Clrcum,tanees IS to be construed ru., a representatIOn hy Walston & Co. Inc All cpresSlOn!; of OPllllon are subJcct to changc 'Ithout notice Walston & Co, lnt', or allY Officer DllectOi or Stockholder thercor, rna) hn\c an Interest III the IIccUrlhes mcntlOned herein ThiS mllrket letter Intended ,\nrl mcre!' ns .1 )!cneral. mfornloli comrncnt,lTY on day to OilY malket ne…. s and not as n complete ana!sls AdditIOnal Information …..Ith respect to any seClilltlCS I cferred tu herem Will be Iurtllshed upon request. W'N 301 -2- Present Price Carrier Corp. 51 Chicago Corp. 25 Columbian Carbon 45 Crucible Steel 67 Eagle Picher 44 Eastern Airlines 47 — 50'— Food Machinery 62 General Dynamics(new) 55 General Electric 59 General Rwy Signal 30 Gulf Oil 105 Hewitt-Robins 34 International Nickel 97 Intern'l Petroleum 46 Johns Manville 47 Joy Mfg 65 Kansas City South. 79 Kennecott Copper 130 Magma Copper 92 Martin,Glenn L. 41 Masonite 32 Minerals & Chemicals 28 National Distillers 26 North.Natural Gas 49 Northern Pacific 38 Pacific Petroleums 16 -Pan-AmerIDT3d Air – Panhandle East Pipe. 92 Penn-Dixie Cement 39 Pittston Co. 69 Rayonier 30 Richfield Oil 69 Royal McBee 30 Sperry Rand 23 Sunray Mid-Continent 27 Sylvania Electric 48 Tennessee Corp. 57 Timken Roller Bear. 90 United Airlines u. S. Steel 40 70 Western Pacific 62 Yale & Towne 30 Price Recom. Yield Advice 60-58 ' 4.7 24 4.0 50 5.3 60-58 4.5 22 5.0 47 2.1 2.0'-'- 51 3.2 50-48 3.6 56 3.4 19 4.3 107 2.4 25 5.9 90 3.9 34 2.9 50 4.5 4.6 85-83 130 5.1 6.-9 75 40 4e 32-30 24 48–47 40-39 11 3.9 5.3 0.7 3.8 5.3 4.-7 –4.7- 92 39-37 45 40–38 75-74 31 25-24 25 49 50 90 50 65 73 18 3.3 2.6 1.7 4.7 5.1 4.7 3.5 4.4 4.2 3.5 1.1 3.8 3.7 4.8 5.0 49-46. 23-22. Buy-Hold.Support 45-44. 4340. BuyHold.Support 47-44. -,BuYHoldSupport4643-. '- ,-, Buy-Hold.Support 60-55. Buy-Hold.Support Buy-Bold.Support Buy-Hold.Support Buy-Hold.Support 97-94. Buy-Hold.Support 33-32. BuyHold.Support 44-42. BuyHold.Support 78-r4. BuyHold.Support 4037. 3432. BuyHold.Support 2725. Buy-Hold.Support 2524. Buy-Hold.Support 46-45. Buy-Hold.Support 36-33. BuyHold.Support 1514. '3.-715. – , Buy-Hold.Support 8885. Buy-Hold.Support 38-35. BuyHold.Support 60-55. BuyHold.Support 30. BuyHold.Support 6864. BuyHold.Support 2927. 2221. 2524. BuyHold.Support 4745. BuyHold.Support 5550. Buy-Hold.Support 3735. BuyHold.Support 6966. BuyHold.Support 60-55. Buy-Hold.Support 28. EDMUND VI. TABELL WALSTON & CO.INC. ..;-