Walston &- Co. – – – – I n c . – …;. Members New York Stock Exchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE ISw,lml.nd) OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM o. fABELL'S MARKET LmER October 11, 1957 The largest stock market decline in over ten years continued this week until a rally narrowed losses on Friday. At Friday's intra-day low of 434. 15, the Dow-Jones Industrial Average had fallen 200/0below the July high of 522.20. This is the most severe decline since the 1946 drop of 230/0. How much lower can the market go . .,. In-our 1957 forcecast, 'published last . . – would see a wide trading range in the averages bounded roughly by 5 20 on the upside, and something like 440-420 on the downside. This prediction has not yet been inva- lidated. The thing that has worried most investors has been the sharpness and sever- ity of the decline. It is now important to examine our original forecast to see whether it should be revised. To see, in other words, whether the market is going to continue to drop sharply below the current lows. In examining the possibilities, both technical and fun- damental factors must be assessed. From a technical point of view, a chart of the averages alone would indicate the possibility of considerably lower levels. However, when one examines the technical pattern of individual issues, it becomes apparent that many stocks have reached what appear to be their long term downside objectives – some having declined 500/0 and 600/0 in the process. A few look still lower it is true, but they are greatly outnumbered by stocks which are close to downside objectives and by strong stocks which have maintained bullish patterns throughout the entire market decline. From a fundamental point of view, any further substantial declines would move .the price -earnings r,atio ,,pCtheDow – and. that oLma!lyindivid1J.a),!;!tocks — .down to which have not prevailed in many years. There will undoubtedly be a decline in business in 1958, probably a healthy thing in an economy which had become obsessed with per- manent inflation and permanent prosperity. Is the decline going to be so severe as to warrant new depths of pessimism This is hardly probable. The anticipated business weakness has, after all, been brought about by a credit policy designed to moderate long range forces which had caused an unprecedented boom. As has been repeatedly pointed out in this letter, these forces still exist. The current policy of restraint will certainly be moderated as soon as any important downturn in business occurs. The long range forces should then be free to provide for expansion in 1960 and beyond. Such an outlook does not warrant the despair that would be engendered by a further serious decline. There is no way of pointing out exactly where the lows will be, especially iIi a market which has declined as sharply as this one has. There is, however. strong reason to believe that we are nearer these lows than many appear to think. While it may not be time for aggressive buying, panicky selling certainly does not appear to be warranted. The attention of the investor should be devoted to discovering good technical and fundamental values which 'can be purchased at depressed levels for long term holding. EDMUND W. TABELL WALSTON & CO.INC. AWTamb This mnrket letter is not. and under no CIrcumstances IS to be construed (IS. an offer to sell or a soliCitation to buy any securities referred to herein The InformntlOn con tamed herein IS not guaranteed as to accuracy or completeness anri the thereof IS not, and under nu circumstances IS to be construed as, n representA- tIOn bv \\ nlston & Co. Inc All cpreSSlOns of OPIniOn nre subject to chanle WIthout notIce YO,'alston & Co, Inc, and Officers. DIrectors. Stockholders and thereot, purchilse, I'ell nnd may have an mterest m the securltle'l mentlOneri herem This market letter 1; Intendefl and presented merely as (l Itenernl. lIl(ormal COfllfllentall on dal t.u day market news and not as a complete (lnalysl'I ArhiltlOnal mformatlon '\llh respect to any sccurltlcs referred to hereIn WIll be furnIshed upon rellUe'lt \\ '\ 301

Walston &Co. – – – – I n c . – Members New York Stock EXchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE (Sw;t,I.,dJ OFfiCES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LEnER October 18, 1957 After another week of heavy liquidation, the market drifted off further on Friday closed the week at a low of 432.69 in the Dow-Jones Industrial Average and 40. 18 in the naara & Poor 500-Stock Index. As we said in our letter of last week, it is difficult to p where the actual lows may be, especially in a market that tends to be ruled by emotion panic. Our original projection of 440-420 should still hold good, but could be upset by further deterioration of confidence due to the foreign situation. One fact should not be lost sight of, however. It is easy to say by hindsight that Istocks should have been sold last July when the market was above 500. However, after the decline.it would appear-foolhardy to stock commitments at current depressed levels. This would be true even though the market were to wo (;cHn.ewhat lower over the near term. Amid the excitement of late tapes and sharp declines over the past few months, g appears to have gone relatively unnoticed by most investors. That is, the amazing r performance of the grocery chain stocks. The market, as me asur ed by the Standard & r's 500-Stock Composite,has now declined some 180/0 since its high in July.As of th,the Standard & Poor Index of food chain stocks was actually above its July high and tocks in the group had not declined at all from the July tops. The reason for this appears to be that the food chains offer attraction for any inve ,no matter what his opinion concerning the business future. Even in periods of business IdE!c,ines, the earnings of grocery companies hold up relatively well since food expenditures stitute one of the most stable items in the consumer budget. Taking a more aggressive w,there are a number of reasons for optimism concerning the industry's future. First 0 ,more than any other industry, food store sales should show a direct correlation with 1f.I\J!-,'Ll .vu growth. Our expanding population is causing favorable earnings comparIsons in 957 vs. 1956 and this factor will probably continue to operate in 1958, regardless of the busi'ness picture. Furthermore, in recent years, food chain sales have expanded faster than Ipclpullatiom due to shifts in buying habits. As supermarkets carrying a wide range of non InrOO(IIH'tgrow in import;rice', the -chains ten1fto r dollars- that went to drug, variety chains and department stores. This ShIft to supermarkets also benefits the grocery chain companies internally. Imorf' and more large stores are opened and unprofitable outlets close, profit margins tend improve and the companies earn more on the sales dollar. All these factors point to Iccmtinued growth for grocery companies and make the group one of the most attractlve in consumer goods field which this letter has been stressing for the past two months. Three grocery chains are included in our recommended list. The first of these is AMERICAN STORES (56). American operates a chain of some 900 markets con- entrated in Pennsylvania, New Jersey, New York and Maryland. 763 of these are self- ervice supermarkets and the company continues to open new and modern outlets. 60 such s were opened during the year ended March 30,,1957 when sales were almost 200/0 ead of the preceding fiscal year and earnings improved to 5.81 from 5.49. Sales for 21 weeks ended August 24 were 90/0 ahead of last year and earnings for the full year should improve to 6.00-6.25. A strong financial position makes a dividend hike from the sent 2 rate a possibility. GRAND UNION (32) operates a chain of 371 stores and is aggressively expanding the supermarkets and non-food lines. An aggressive development program has enabled it to widen profit margins and earnings for the year ended February 28, 1957 were up to 2.31, consummating five years of steady growth. For the six months ended August 31st, were 1. 25 vs. 1. 13 and full-year net should be in the range of 2.50-2.75. expansion program makes cash needs heavy and the payout of 72 is relatively small. 1'….111; earnings make it susceptible to a slight increase, however. WINN-DIXIE STORES (26) operates a chain of 473 stores in the Southeast and is expanding rapidly. Earnings ended June 30, 1957 were 1. 71 vs. 1. 68. The comp one of the few which stlll pays monthly dividends and the current rate is 8 a month or 96 annually. An increase here is not beyond possibility. A'NT'arnb EDMUND W. TABELL WALSTON & CO. INC . ThiS market letter not. and undel no CLI(,Umstnncl'S to be construed os, an offer to 'Jell or a '1ohcitatLOn to buy any ccuntle. rererred to herem The mformabon ('oullunerl h('IClll IS not j(unrantced liS to aCrUrllC) or completeness and the furl'llhmg thereof IS not. and undel nu ClIcumslnnces IS to be ron'ltrucd 11 rCJlrcscntn- hun 1,\' '\ulstun & Co, Ill(, All (,,(PICSSlOlll of opinl)l1 me 'luhJect to ch'lnge ,ithl)ut 110tll..C 'Valston & Co, Inc, mvl Offlccls, DlrcLtCls, SLockholdcls and Eml'lyees thereof. Plllrhusc and 111..1)' have an mtcr'st III the 'lecurlti's m'ntlOnen hCI'1I1 ThiS market letter IS mtended and plescnted merely!l.'l a gcneral, In fill mal 1'ummenLlry nil da to dJ. market nc\\s IIlId not as a complcte anaIY'll Ad.htlOn'll lIIformntlOn respect to any SCCUrities referl ed to hCI em will he fUlllllwfi u))on I '(IIlC'll \\-'\ 301 –

Walston &Co. – – – – I n c . – Members New York Stock Exchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE (Swa,.,l.,d) OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LETTER October 25, 1957 A breathing spell for the average investor has been provided by last week's market action. After sell-offs on heavy volume on Monday and Tuesday, the market rallied sharply on Wednesday, chalking up the largest single day's gain in almost 28 years. The gains were held on Thursday and partially given up on Friday with the Dow-Jones Industrial Average closing the week- at 435.15 'compared with its 'Tuesday 416.15.,,, Comparable figures on the Standard & Poor 500-Stock Index were 40.59 and 38.55. With the market steadily moving downward, it was very difficult for the investor to rationally examine his holdings and to make the drastic changes required by both investment policy and tax policy. The recent strength, as noted above, is providing a breathing spell and it would appear imperative that such examination take place at this time. The first consideration must be the probable near term action of the general market. This letter takes little comfort in the widely-heralded fact that the last time a single rally of Wednesday's magnitude occurred was November, 1929. Let it be said that no 1929 is envisaged here, but it is felt that the Wednesday rally was too sharp and involved too high a degree of public participation to be considered sound. If, indeed, a short term top has not been seen already, a level approximating 450 in the Dow-J ones Industrial average or 42.00 in the Standard & Poor 500-Stock Index, should mark the extent of any near-term strength. Such strength should be utilized for making portfolio changes along the lines consistently-recommended-by this letter. For'three mohths now we -have pointed out the relatively unfavorable outlook for most durable goods producers in 1958. Any further strength from these levels will provide an excellent opportunity for eliminating stocks of this nature from portfolios and for establishing tax losses. In semi-investment accounts, and intermediate term trading accounts, a cash position of 50 should be gradually established, beginning at current levels and continuing on further strength. – Cash thus generated should be utilized on subsequent weakness in order to purchase stocks of the consumer goods type which have been repeatedly stressed by this letter over the past months. This recommendation cannot be stressed too strongly. The average aggressive investor, when consumer goods stocks are recommended, makes the statement that he is interested in a dynamic type of issue and not in a conservative investment type equity. It must be strongly pointed out that if any dynamic upside action takes place over the next year, the chances based on both technical and fundamental probabilities, favor its taking place in the hereto- fore stable consumer goods stocks. It is the former market leaders which will probably show the disappointing drifting-type action. This has not been true in the,past, but the isoftel'! an,unrel!abJ,e tothe future andjhe slccess.ful investor achieves his success by anticipating changes in market sentiment before they occur. Thus, current policy should be one of liquidation of doubtful capital goods issues, starting at current levels and continuing on strength, establishing valuable losses where possible. On any subseque'nt return to around the old lows in the averages, an aggressive buying program in the consumer goods field appears in- dicated. AWTamb EDMUND W. TABELL )orA! STON & CO INC ThiS market letter IS 001, lind under no Circumstances IS to be construed as, an offer to or n sohcltatJOn to any securities referred to herem The mformntlOn l'()ntamed h('1 ('In 11 not gunrlLnlecr! as to accuracy or compiet(lneos nnd the furntshlnJ thereof lS not, and unucr no circumstances I'! to be construed as, a Tepresenta lIOn by ''''II)ston & Co, Jnc All e'lpresslOns of opmlOn are subject to change without notice Walston &- Co, Inc, and Officers, Directors, Stockholders and Eml!luy('es thelcor, purchase, sell and hll\oe nn In the mentioned bcrllm. market letter IS Intended and presented merely ns n general. Informal commentmy on to rlny market nev.s and not as a complete AddltHmal mformatlon \\lth to any securities referred to herein wlll be CUI nlsher! upon re(IUest \\ 301

———————————————– NEW YORK Wdlston &- CO.—–Inc. Members New York Stock Exchange PHILADELPHIA LOS ANGELES SAN FRANCISCO 8ASLE (Swi,,.,I.ndj OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LETTER November 1, 1957 As mentioned in last week's letter, the quieter market of the past fortnight has given time for a calmer appraisal of the market probabilities over the nearer future. A number of points should be stressed. (1) The Dow-Jones Industrials at the October 22nd low of 416.15 dropped just a shade below the first broad support level of 440-420. The low on the Standard & Poor 500-Stock Index at 38.84 was at a comparable point. It is possible that this may be the low of the move, but is by no means certain. A lot depends on the business picture, which, from car loadings and other indicators, appears to be deteriorating. A lot depends – also on -wnen the -Pe'd-eral Reserve-Board reverses-'its tight money'policy. lot —, depends on the foreign picture. (2) How much farther can the market go on the downside if the recent lows are penetrated One clue from a technical viewpoint is the top formation built up on the Stan- dard & Poor 500-Stock Index. The top has several downside potentials that can be pro- jected. While some interpretations count lower than the one mentioned below, the most plausible reading is a decline to 37-36 as against Friday's close of 40.44. This would be roughly equivalent to 400-375 in the Dow-Jones Industrials. Such a decline would be a 50 retracement of the entire advance from the 1953 low of approximately 254 and would also be a 25 overall decline in the averages. This would be equal percentage wise to the 1946 decline. There is a broader, more uncertain formation that has an even lower po- tential. (3) How far can the market advance A normal technical recovery of a decline like the 107-point drop from the June-July highs usually retraces a third to one '-half of the drop. This would indicate a possible advance to 452 on a one-third retracement and about 470 on a half retracement. However, there is now the broad supply area overhead which consists of the broad eighteen-month trading range. This overhead resistance starts at slightly above 450 and is particularly heavy from 460 to 470. It will be extremely difficult for -t-his-ar,ea-to-be pedodLs-consumed-in-building-up a new base sufficiently strong to push into the heavy overhead supply. (4) A great many individual issues have reached downside objectives, but many others could work lower. However, most potential base patterns have been destroyed by recent market action and, as noted above, it will take a long time for new patterns to form (5) Some groups have not destroyed their potentially favorable patterns. In most cases, the groups are in the consumer goods areas. The following groups fit into this category Food Chains Tobacco Finance Food Products Utility Soft Drink Retail Chain Drug Containers Electronics-TV ..,.- This falls in line with fundamentals. It would appear that personal income will remain high and unless a more drastic dip in business occurs than is now anticipated, consumer spending should also hold up very well. I believe portfolios should be strong in the above groups. \ (6) There are certain other groups that appear to be nearing bottom and that could enter the favorable classification. These groups should be watched closely for such a signal. Candidates for this gr.oup includePaper, Rubber,Glass, Aircraft Manufacturers, Chemical, Natural Gas, Building Supply, Automobiles. (7) Would continue the 50 liquid position in semi-investment and intermediate term trading accounts advocated in last week's letter. The 50 held in stocks should be mainly in the favorable groups mentioned above. When there are more certain signs of a market bottom, the balance of funds should be invested. This is not yet apparent from my work. (8) The long term favorable outlook for the economy and the market based on an increasing popUlation with increasing needs and the ability to meet these needs is still the important thing for the long term investor to remember. Whatever periods of price weakne that will occur in tj1e next year or so will probably present the last opportunity for the long term investor to purchase sound common equities before they rise to a higher plateau in the J ThIS market letter 15 not, Ilnd uncle no clrcumstnnces IS to be ns, an oEDMlaJrNd)nlWnJlO;J1ABELbrltw5 referred to herem The mlocmnllOn Lontnlncd he ('In IS not g1l.1rnntccd to 3'Clll..tcy or completeness and the furnlshlnJ, theru)f not, 'Inri no… I to be con;ti ued as, a representa- tlOn hy & Co, Ine All c'lpre5Slons of OPInIOn are subject to and Officers, Directors, Stockholders and E1Y1II1oyC'e5 theleof, purchMe, sell and m'l.Y ha\c an In the ;e(urltJe; mar e Id'h.r Ittended and merely 8S II general, lllfolmnl ('010l11en1ary fin to ,lal( nl!llklt news nnrl lint a5 n complete A,ldltilln.li lllformntion '\Ith lC&pect to nny ;;\l('UrtlICS refclred to heleln wilt be fUII1I;hed upon rellllcst \\\ 301

&Co.Walston—-Inc. Members New York Stock Exchange NEW YORK PHILADELPHIA lOS ANGELES SAN FRANCISCO BASlE (Swaml.nd) OFFices COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABEll'S MARKET lEnER November 8, 1957 President Eisenhower's address failed to have the tonic effect expected and the Dow-Jones Industrials dropped to the middle of the week's range of 440.60 high and 425.46 low to reach a low of 432.11 on Friday and closed at 434.12. The high of the advance from the October 22nd low of 416.15 was reached on October 31st at 446.06. This is just a shade below the heavy upside resistance at 450-470. The market is undergoing another test of the first downside support level in the broad 440- 420 range. A dip to a new low would probably indicate 400-385 in the Dow-Jones Industrials and 37-36 in the Standard & Poor 500-Stock average. tance continues at 4 5 0 – 4 7 0 . – – – – . – The upside .- res.is-.- A few more random observations on the market are noted below. (1) The market is much lower than the various averages indicate. While the Dow-Jones Industrials and Standard & Poor 500-Stock Index declined around 20 from their highs, many individual stocks and groups declined 40 or 50, or more. Trendex of San Antonio, Texas, issues a weekly composite trend of all the stocks on the New York Stock Exchange. This index recently was at a level equivalent to where it was in July, 1954. At that time the Dow-Jones Industrials were selling at about 340 as compared with the recent 417 low and the Standard & Poor 500-Stock Index was selling at roughly 30 compared with the October 22nd low of 39. (2) This discrepancy is partially explained by the fact that the equities of the larger companies that are favored by institutional investors have held up relatively better than stocks outside the range of the favorite fifty. General Electric, for example, at a price of around 60, is selling at approximately twenty times earnings to yield 3.3. On the other hand, American Brake Shoe, a good quality issue that has shown a profit every year since its incorporation in 1902, was sellingi,at.its recent price of, 37, at-under seven-times anticipated earnings and at a probable yield of above 7. There are many price discrepancies of this nature in the present market. (3) Over the nearer term of the next six months or so, yield issues like bonds and preferreds, have a clearer pattern than that for most common equities. Inflationary tendencies seem to have temporarily receeded, and a slow and gradual relaxation of tight money is indicated. The result should be a firmer bond market gradually gaining upside momentum in the next few months. Where it is possible to find bonds and preferreds convertible into common and selling at reaso n able price levels, a double advantage is gained. A list of favored issues is being pre- pared and will be issued shortly. (4) In the contemplated lengthy period of consolidation and adjustment indicated in the stock market, there will probably be as much diversity and selec,.. tivi ty as was experienced in the advancing phase. Several groups appear to be forming potential base patterns, although this may take more time. Some aircraft manufacturing issues are a case in point. Downside objectives were reached early in the decline and fairly good potential base patterns have been formed. The electronic group alSb has been showing above average action as well as the consumer goodS' groups such as the drugs and food chains mentioned in letters over the past few months. Would continue the policy of concentrating on groups with favorable patterns and eliminate unfavorable groups on strength in order to build up a 50 liquid position to take advantage of later buying opportunities. EDMUND W. TABELL WALSTON & CO. INC. ThiS '!1nrket leHer IS not. and under no Circumstances IS to be construed as, an offer to sell or II sohcltatlOn to buy any SeCUTllle8 referred to herein The mformatlon (ontrllnecl hC!rC!1n IS not ItllnranlC!cd as to or completeness and the thereof IS not, and un del' no crrcumstall('es IS to be construed as, a reprll!cnta- 1!on by &. Co, Inc All expre;SlOns of OPInion are subject to chanJ!e Without nohcc \\'alston & Co, Inc, and Officers, DIrectors, Stockholders and F,mplo(.'Cs theleof, sell and mfl.Y hn.. e an Illtcrest In the mcntlOned herem ThIS mnrket letter IS wtended and presented mcrely a! a general, Inform,1i commentary on .iay to dny market nes and not as a complete Rllalyu; A,(dltlOnal mfOlmntl0n \\Ith 1CllJect to nny sccuntze' referred to herein ill be fUI up')n request \\.. 301

Walston &Co. Inc. ….;….;;..; Members New York Stock Exchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE ISwit,l.nd) OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LEnER November 15, 1957 The reversal of the tight money policy of the Federal Reserve Board late Thursday afternoon by a cut in the discount rate from 3 1/2 to 3; brought about a sharp rebound in both the bond market and the stock market. Stocks opened sharply higher and retained most of their gains. At the intra-day highs, the Dow-Jones Industrials reached 442.82 and the Standard & Poor 500-Stock Index attained 40.65. These prices compare with the October 31st highs of 446.06 and 41.58. The close was at 439.35 and 40.33. In the past four weeks the market has ranged back and forth in a wide trading a.rea.- This-hasbuilt up-apotentlsTbase paRer'fiwl1n a rally posslbiTity–somewhereirt' – the 450-470 range in the Dow-J ones Industrials and 42.50 – 43.50 in the Standard & Poor Index. This about coincides with the heavy overhead supply in both averages and also the attainment of a third to a half retracement of the decline from the June highs to the October lows. As mentioned in previous letters, would take advantage of strength to switch from unfavorable groups ,as far as the intermediate term technical pattern is concerned, into groups with more favorable potentials. In the process of doing this, I would set up a 50 liquid position in order to take advantage of later buying opportunities. In the favorable classification are included such groups as – Food Chains Tobacco Drugs Utilities Department Stores Meat Packing Natural Gas Soft Drinks Containers Fertilizer Electronic – TV Cement – – These groups, it will be noted, are mainly in the consumer goods category. per-Bonal hold up of a in business and that consumer spending will be well maintained. It is probable that con- sumer goods stocks will regain some of their former popularity when they were the leaders of the 1942-1946 advance. As the pattern gradually clarifies, other groups will be added to the favorable category. Groups showing unsatisfactory technical action and to be sold on strength includ Steel Machinery Aluminum Railroads Sulphur Business Machine Coal Air Conditioning Oil Most of these groups are in the heavy industry or capital goods category. With the recent Business Week survey indicating a probable 70/0 decline in capital spend- ing for 1958, it is doubtful whether these groups will show above average action. How- ever, capital spending will be on a high plateau and will again eventually expand. How- ever, a long period of backing and filling will be needed before they are again ready for a full scale advance. ' In last week's letter we mentioned that bonds and preferreds had a clearer upside pattern than most common equities and, with inflationary tendencies receding, a slow and gradual relaxation of tight money was indicated. This week's action by the Feder-al-Reserve Board the first of severarsteps to-graduallyreverse a- policy that has been in effect for a long time. Probably more than one step will be needed to reverse the drop in business pattern since mid-1957. It must be remembered that it took over two years for the tight money policy to reverse the business boom which the Federal Reserve Board thought was excessive. The first upward change in the dis- count rate was in April, 1955 when the rate was increased from 1 1/2 to 1 3/4. In six successive steps, culminating in August of this year, the rate was raised to 3 1/2. It is probable that over the next year or so further downward adjustments will be made before the business pattern finally consolidates and adjusts and is ready for another advancing phase. In the meantime, Just as in the recent advancing phase, there will be coptinned SAlectjvjty dJJring the perjod Of consoljdatjon and adjustment market letter IS not, nnd under no ClfcumstaTICcs IS to be construed an offer tu ;ell or II herem The mformatlOn umtninc(j hmcln nut ae; to nCClIIRC) or and the tlrnlshlnl thereof IS as. a representn tlon by \\'nlston & Co, Inc All or opinion are 'lubJcct to ('hnnle WIthout noticc…. Stockholders and bmpoyee'!. thereof. pult'hase, sell and mal hn\'c an mterest m the securltlCs mentIOned herem merely Il'l a general lnfol m.ll Comm!!ntar) 01\ dll) to dllY nlflrh.!!t new'!. and I\ot as a complete analYSIS Addltmnal Lllformatlon \\ Ith respect to an) 9ccuntics rEferled to herem will be furm.,hed upon reque'lot ' \ \ ' I \ ' 301

Walston &- Co. – – – – l n c , – Members New York Stock Exchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE (Swaml.nd) OFFICes COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM TABELL'S MARKET LEnER November 22, 1957 After declining on Monday and Tuesday with the Dow-Jones Industrials reaching a low of 427.23, the market reversed the trend and rallied sharply on increased volume for the balance of the week. Intra-day highs of 445.64 and 41.13 (Standard & Poor's 500-Stock Index) were reached on Friday as compared with 446.06 and 41.58 reached on October 31st, the day of the high since the October lows. The market has now spent twenty-four trading days in a thirty-point trading range. As mentioned in last week's letter, there is now a sufficient base to indicate a rally potential into the lower part of the heavy overhead supply area above the market. This-overhead'supply-extends between the450-470-area with-the-concentration-between 460-470. Short term indicators point to the probability that this level can be reached unless sudden international developments alter the pattern. The market has suffered a severe decline since the July high of 523.11, the third of a series of triple tops on the averages. If the highs of each individual stock in the Dow-J ones average since 1955 are used, regardless of when the high was reached, the average reached a high of around 590 assuming that all the highs were reached on the same day. It is interesting to note that some stocks like Chrysler, General Motors and Westinghouse reached their highs in 1955. Only nine stocks out of the thirty reached their high around the time of the July, 1957 high in the averages. A decline from 590 to 417 is equivalent to roughly 300/0, as compared with an actual 200/0 decline from 525 to 417. After a decline of such magnitude, investor confidence has undoubtedly been badly bruised. It usually takes a considerable period of time to repair the damage. For example, after the 1946 drop of 250/0, the market consolidated from September 1946 until November 1949, a period of thirty-nine months. After the 1937 decline, an even longer time period was required. \ The recent market decline, from a technical viewpoint, destroyed a large -.- . number'of potentialpatterns. It will require a considerable period of time to these patterns. In some cases, these patterns can form very rapidly, particularly if the news is dynamic. For example, the missile stocks formed base patterns in under a month. However, most groups will require longer time periods. It took Bethlehem Steel three years between 1951 and 1953 to form the pattern that indicated the move from 12 (adjusted) to 50. It took Joy Manufacturing almost eight years to build the pattern that suggested the move from 12 to 75. These are extreme examples, but probably quite a lengthy time period will be needed depending on the volatility of '. each individual stock. Thus it would appear that after a rally, the market will again drop back into a broad trading range in order to enlarge the potential base. This backing and filling movement could occur several times. If the October lows hold it is possible that b\oad trading range may be within the confines of roughly 470-420. The easing of tight\money would indicate that any drop in business might be held within reasonable bounds even if the 420 level were broken it ,,ould appear that the 400-385 level woIld be the next support point. This does not imply that the market will be a static affair. Individual stocks Inwill have selective action both on the upside and downside. Some groups have held patterns intact. included this classificatio;'; are- – Containers' Drugs Electronics Food Chains Soft Drinks Tobaccos In addition, there are m,any individual securities in other groups that also have retained their potential patterns. We will try to draw your attention to such situations in subsequent letters. EDMUND W. TABELL WALSTON & CO. INC. ThiS market letter IS not, and under no Circumstances 15 to be construed as, an offer to sell or a soiLcltatwn to buy any seCUritIes referred to herem The InformatIOn contamer! hClem IS not Iuarll.nteed ns to accuracy or completeness and the furmshinl therc6f IS not, and unrler no UTcum;tllfices 1; to be ('onstrl.lcd as, fI leplcscnta- lIOn loy \Vulston & Co, Inc All expreSSions of opinion are subject to wlthuut notlcc alston & Co, Inc, and Officers, Directors, Stockholders and Employees thereof, purchase, sell ani! may ha\e an mterest m the seCUrities mentiOned herem ThiS market 1('tter 1; Intended and presented merely all a genera\, 1l1formnl commentary on rldY to day market nc\\s and not a; a complete analYSIS Additional mrornmtloa With rcspect to nny securitIes referred to herein \\111 be fUI upon I equesl \\;..; 301

Wdlston &Co.I —–Inc. Membe,'s New York Stock Exchange NEW YORK ' PHILADELPHIA ' LOS ANGELES ' SAN FRANCISCO ' BASLE (Sw;hed.,d) OFFICES COAST TO COAST CONNECTED 8'1' DIRECT PRIVATE WIRE SYSTEM I TABELL'S MARKET LEnER November 29, 1957 The sudden and unexpected news of President Eisenhower's illness brought about another week of wide and hectic fluctuations in the stock market accompanied by a heavy volume of trading and a late tape. The Dow-Jones Industrials reached a low of 434.34 on Tuesday and a high of 452.49 on Friday. The comparable range on the Standard & Poor's 500-Stock Index was 40.00 and 41. 95. 'What technical implication can be drawn from the wide price swings that have occurred in the market in recent weeks On the constructive side, the averages, in their decline from the July highs, have held at a level just a shade below the first support -level-of-44-420(42-4)onthe-S-&–PIndex)'envisioned in my 1957 After reach– ing a low of 416. 15 on the Dow-Jones Industrials on October 22nd (38.84 on the S & P Index), the market rallied to 446,06 and 41. 58 on October 31st and held well above the October lows on four declines since October 31st. It has now penetrated the October 31st highs. However, it must be realized that there is heavy overhead supply above the market. The Dow-Jones Industrials held in a range between roughly 525 and 450 from late 1955 until early October of this year. The market has rebounded to the lower part of this area. From a technical viewpoint, it would appear that it will be extremely diffi- cult for the averages to do much more than attempt to advance to the lower part of this area at this time, Probably 460-470 is the most optimistic projection prior to a lengthy basing out period in the broad 470-420 area, or somewhat lower if the business picture deteriorates at a greater pace than now envisioned. This is the technical pattern suggested for the general market. Individual issues have quite different patterns with some indicating above average action and others below average. Under present circumstances it would appear wise for the inter- mediate term investor to use current strength into the 450-470 level to eliminate the poorer acting groups; establish a 50 liquid position and replace issues sold with better acting groups during periods of weakness. The groups showing the most favor- !!lle least favosable rel,.atiye.strength havel;eel! listedip.r.ecent.bulletini . . Some of the groups listed as favorable have shown excellent price action in recent markets. The food chains are a case in point, with some issues reaching new high territory. AMERICAN STORES (64) which we have mentioned as an .interfsting buy in September, reached a new high last week. The TV-electronics have also outperformed the market with ZENITH RADIO (132 1/4)one of the group recommended, showing particularly impressive action. A few other attractive issues are listed below AUTOS – Chrysler BAKING – Sunshine and United Biscuit CONTAINER – American ELECTRONICS-TV – Mo tCoraonlaa, nRdayCthoenotani,neMr aCgnoarpvox, Hoffman Electronics. FARM MACHINERY – J. 1. Case FER TILIZER – International Minerals & Chemical. FOOD CHAIN – First National, Grand Union, Winn-Dixie. FOOD PRODUCTS – General Foods GLASS – Anchor Hocking RETAIL CHAIN – Federated, Gimbel SOFT DRINK – Coca-Cola, Pepsi-Cola UTILITY – Central Southwest, Florida Power, Gulf States Util. , General Telephone. Other favorable issues include LILY TULIP, BELL & HOWELL, HOUDAILLE INDUSTRIES, ABBOTT LABORATORIES, JOHNSON & JOHNSON GENERAL TIRE and HERTZ CORP. Strength in steels, machinery issues, oils, aluminums, railroads, coal, should be used to switch into issues like the above on price weakness. EDMUND W. TABELL WALSTON & CO. INC. Tht; market letter IS not. and unuer no ell cumstanccs 15 to be construed as. an offer to ;ell or a sohcltallon to huy any secunhes referred to herem The lniOrmlltlf)ll (,OIILIlInCII hcr('lfi IS n ….t as to ,\CC\ll UC'y 01' an,l the thereof 15 not, nntl l1nder no ClrCllm..tHnce; IS to he Cllstrueu as, fI repre;entn. tl(!1 hy Wldston & Co, in(' All ellre'lSlcHI of PI1\IOn me ulJject to ehdnl!';c WIthout lItlee Wulston & Cu, In(' nnd DlIectms Stockholders nnd thereof, nnd m.l) ha\'e ,m In the ,ecuntlcs mentIOned herem This market letter 15 lntended and lllesented merely 11'1 n general. Infolmal '01\11\1entar) on 11ft to nl.lrl-'t news allcl not flS fI complete analysIs AddltlonallnformntlOn '\Ith l'espeel tft securIties referred to herein …. 111 he fill upon r e 1 I u e ; l . \\ X 301

,- Walston &- Co. Inc. Members New York Stock Exchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE Sw;he,landl OFFICES COAST TO COAST CONNECTED BY DIRECT PRIVATE WIRE SYSTEM I TABELL'S MARKET LETTER December 13, 1957 The Dow-Jones Rail average on Thursday gave the first constructive signal sinc the start of the long decline from the July high of 154.70 to this week's low of 94.91. All during this period the average has been in a definite downtrend channel. Thursday's rally of five points to an intra-day high of 101.05 penetrated the downtrend line for the first in the decline of almost sixty points. A slight further rally occurred on Friday with an in- tra-day high of 102.21. This does not mean a sharp uptrend in the rails, but it probably means a flattening out of the decline and a possible attempt to base out. This will take time. There IS some overhead supply at around 105. The Industrials declined during the week to the 435 support level and closed at 440.48. The overhead supply in this average 'is in 7ntinU'ed crosscurrents '- during the coming week. The most dramatic price movement in the securities market in the past month has been the advance in bond prices. Long term government bonds, for example, were selling at prices to yield around 3.8 prior to the announcement of the cut in the rediscollrlt rate on November 14th. They are now selling at prices to yield about 3.1. The American Tel & Tel 5 issue of 1983 was offered just prior to the rediscount cut at 101.46 to yield 4.9. They are now yielding about 4.45, and are selling around 1081/2. Moody's Cor- porate Bond yield of AAA rated long term bonds was around 4.15. It has now dropped to 3.81. This yield index of seasoned bonds moves more slowly than the new issues. With the probable continued easmg of money rates, most students of the bond market expect higher prices. In a somewhat similar situation in 1953 and 1954, the high grade bond yield index dropped from around 3.40 to 2.85, or about 55 basis points. A comparable percentage drop in yield in the present situation would be about equivalent to 66 basis pOints or to around 3.4. The advance in bond prices has somewhat improved the competitive position of high grade stocks. A further decline in bond yields would accentuate this improvement. A month ago with new bond issues being offered at close to a 5 yield, it was difficult to Justify theO'purchaseof-growth stocks arayield of 2 to–3-1-;-2,- or stable income st'Clc'ks ,',-,. at 5 to 6 1/2 yield. However, if seasoned high grade bonds returned to a 3.4 yield basis, a growth stock like duPont with a yield of over 3 1/2, or an income stock like C.1. T. Financial with a 5.3 yield would be competitive with a new bond issue yielding around 4 but with no chances of capital appreciation except an advance to the call price. Some of the growth groups are beginning to show signs of increasing relative strength. The chemicals and papers are a case in point. There is no immediate indica- tion of a sizeable' upward move, but potential base patterns are forming that may take some further time to complete. The chemicals and papers reached their highs a long time ago. duPont, for example, reached its high of 249 3/4 over two years ago in 1955. The papers reached their highs in mid-1956 and have declined sharply since. Stocks in the stable income group have been mentioned in this letter for the past few months. They include baking, containers, drugs, electronic-TV, finance, food, food chains, retail, tobaccos and utilities. There are issues in other groups that also appear attractive. WILSON & CO. (15 1/4) has clearly outperformed the rest of the meat packing group. Management has done an excellent job in changes in marketing and manufacturing operations and has eli- minated many unprofitable operations and replaced them with highly efficient modern and up to equipment. The sporting the largest 1- sporting goods company in the world, has grown every year since its start in 1931. Sales are close to 50 million in this division and it contributes importantly to Wilson & Company's earnings. The company is concentrating on higher profit margin products. About 40 of the food line consists of pre-packaged products. Wilson & Co. reported 2.19 for fiscal 1957 as compared with 2.83 in fiscal 1956. The drop in net was sup- posedly due to non-recurring expenses in moving plant operations. 1958 results should be considerably better. The stock paid 1.00 dividend in 1957 to yield 6.6. The technical pattern is potentially attractive. It has held in the broad 17-8 range since 1947 and upside potentials are wide. Relative strength in recent markets has been very good. Tax loss sales in other securities could be switched into Wilson & Co. Inc.

Walston——–Inc. &-Co-.—.–\'-;, Membe)-s New York Stock EXchange NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO BASLE (Sw;t,laod) OFFICES COAST TO COAST CONNECT.,!) EY iIRECT PRIVATE WIRE SYSTEM TABEll'S MARKET LEnER December 20, 1957 I Weakness In the automobile and steel groups and continued tax loss selling, brought the Dow-J ones Industrials back to the 425 support level and Standard & Poor's 500-Stock Index to the 39 support level. These support levels haveheld on severalocif) since the October lows. There are only a few more remaining days left for tax loss !'.,llin and if the support levels between here and the October lows continue to hold, it would be an encouraging sign for the traditional year-end rally. The important question is whether or not the bulk of tax loss selling is completed or whether there are still sizeable amounts 19J;–erhanging the market hoping for a stronger tone near the turn of the year. It is also '–interesting to note that dur-ing –this weaknessthe food chains, utilities, etc., gave little ground. The time is again at hand for the annual forecast of the trend of business and the stock market for the year ahead. Enough of these forecasts have already been issued to discern the general pattern of economic and financial feeling. Most forecasts predict a lower business level for the first half of 1958 with a pick-up in the second half. Most stock market predictors anticipate a range within the broad limits of 500 and 350 in the Dow-Jon Industrial average (now 427.20) and 45 and 35 in Standard & Poor 500-Stock Index (now 39. In a recent address to the Association of Customers Brokers in New York, I made the following comment As for the general market, I would expect that the market will experience the usual cross currents in December due to tax loss selling and switching. Because of the downward trend of recent months, the December low will probably be reached late in the month. This will be followed by the usual year-end rally into next year. Just how far this rally will carry is problematical. The heavy overhead supply at 450-470 should prove a pretty substantial upside barrier. I would use such a rally, if it occurs, to lighten hold- ings in unfavorable groups. A testing of the October lows in early Spring is to be expected If business deteriorates no more than now expected, the October low of 416 may hold. If a f'!.rther !he ,400-385..-level p.!obabil!ty. Therefore, in my opinion, the possible range in the Dow-Jones Industrials for 1958 might 1- be 470 high and 385 low. The last half of the year should be more favorable than the first half. Extreme selectivity will be a feature of 1958. Groups showing the best relative strength action during recent weeks include food chains, aircrafts, finance, tobacco, food products, containers, baking, fertilizer, electronics, retail chain, farm machinery, utilities, drugs and soft drinks. Most of these groups, it will be noted, are in the consumer or consumer durable field. Some of the relative firmness can be ascribed to the defensive nature of the industries involved but, on the other hand, many individual issues in these groups have built up fairly sizable base patterns over the past year or two. From a technical viewpoint, they could stage a good percentage advance. There is a seco nd classification of group action. These groups appear, in general, to have started to form re-accumulation or base patterns but may require more time. These groups should be bought during periods of price weakness. They include airlines, building stocks, chemicals, electrical equipment, glass, natural gas, liquor, meat packing, paper, rubber and even our long forgotten friends, the textiles, which are showing some indication of basing out. None of these groups show signs of an iyr,- mediate move but should be watched closely for possible change in trend. athird classification of groupsthat have base-out-I'I;,j and may require a long time to do so. They could be somewhat -.,ulnerable in the fur- ther ups and downs we anticipate in the market over the next year or so. In this group are air-conditioning, aluminums, automobiles, machinery, mining and smelting, oil, railroads and steel. In a broad sense, it appears that consumer groups should show better action over the next year or so than the capital goods issues. To put it another way, the 'lights' should act better than the 'heavies'. A VERY MERRY CHRISTMAS TO ALL EDMUND W. TABELL b&ThIS mnrkellcttcr IS not and under no Clrcumstnnce; IS to be construed al., an offer to to helctn The informntlOn cQntnllled hel eln not guaz ant,1 IS to .tLCl1r,uy 01 completenes'l llnd the furmo;hzng thereof 10; not, and under no I'll I to be conbl! UM a representa. tlon h \\'nlston & Co Inc All of OPlnUJn nrc to \Llthnut notIce Wnlston 8.. Co, In(', and OffIcers, DIrectors, and lmp,,ec-. thelcof, JulLhnsc sdl anu mn h\Le an lnterest In thl' mentIOned hereIn This mnrel letter IS Intended and presented merely .IS a general, Informnl 011 to ddV I'Jalkel new and not ao; n ,,,mlliete anli)q… ArldltlOn'll IIlfOlm'lhon wIth to any ,eellnlle; referred to hClelTl 11\ he flu 11))ln reqllco;t \\-. ,01