Tabell’s Market Letter – January 16, 1959

/!'- / FIJLE COP Walston Inc—- Membe,'s New YOTk Stock Exchange NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND ABROAD January 16,1959 A year ago this letter pointed out that market action in December and January seems to follow a pattern. Since 1935, tax loss selling and switching usually has had effect on markets at the end of each year. The following table shows that there has been rally at the end of each year which has carried through into January of the following year even though it has been very small and of a few day's duration in sOITeinstances. The table, based on Standard & Poor's 425-Industrial Stock Index, shows, in columns 1 and 2, the date and price when the average reached its December low. In columns 4, 5 and are date and price of the next subsequent high and the percentage advance. If the low of 'the previous the dateTs noted in colurrii17. Tlie- subs-equent low, the year-end close, and the trend are noted in the last three columns -1- -2- -3- -4Year Date Low Year Date -5- Next High -6/0 Adv -7- Dec. Low Broken -8Subsequent Low -9- -10Year's Trend Close \ \ 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 12/16 12.07 1936 4/6 14.81 22.7 Never 12/21'16.031937 3/6. 18.10 12.9 4/26 12/28 10.03 1938 1/11 11.73 16.9 12/9 12.28 1939 1/4. 13.08 6.5 -1/13 12/12 11.89 1940 1/3' 12.42 .4.5 -1/12 12/23 10.18 1941 1/10. 10.62 -1/21 12/23 8.47 1942 1/5. 9.15 8.0 -3/11 12/1 9.39 1943 6/14 12.58 13.4 Never 12/1 11.06 1944 3/17 12.16. 9.9 Never 12/1 12.64 1945 3/7 14.10 11.6 N1iIer 12/21 16.39 1946 2/2 17.99 9.8 2\(J;iJc 12/1 13.94 1947 2/8 15.71 12.7 Nt/vep) 12/6 14.51 1948 1/2' 15.17 12/1 14.90 1941f-ll8-'-fiill5)ffi4 27 12/1 15.89 1950 12/4 19.17 1951 5 ,1;0J cO ever Never 9.73 8.39 9.92 8.70 8.47 7.54 -'0jJ .4 3.58 16.50 -10.26 13.07 12.06 -10.34 8.78 9.93 11.63 0 13.05 16.79 1.i.3.5 15.18 15.12 Up Down Up Down Down Up Up Up Up Down Up 20.57 Up 24.24 Up 195112/1 1952 12/4 1953 12/29 1954 12/1 1955 12/20 1956 12/4 1957 12/23 1958 12/3 25. 24.5 35.14 47.79 49.05 41.88 55.58 1 7.7 Never ..82 -3.8 3/18 14 27.15 10.5 Never 195 3 38.17 8.6 Never 6 1/3' 48.07-0.6 -1/23 1957 1/4' 49.971.9 ,-1/14 1958 2/4 45.57 8.8 Never 1959M1/12''''' 59.92'' 7.8 22.70 45.71 41.98 26.89 Up 24.87 Down 37.24 Up 48.44 Up 50.08 Up 42.86 Down 58.97 Up , \ wa1 23. 30bn a decisive downside penetration. 20th, 1952, but this is not considered . To date. A number of interesting conUusions can be drawn from the above figures and applied to the current market. For example, if the market has been higher for most the given year, the December low is usually reached early in the month. The reverse usually true if the trend has been down. Thus, in 1957, the December low was not until December 23rd, while in 1958 it was reached on December 3rd. More im- however, is the fact-that in has the beeri' broken after and in most cases, if broken at all, it is penetrated in the of the ing ye,ar. Furthermore, with one exception,an advance of 10/0 or more from the DeceJffi(.el' low has always been followed by an up market. So far this year the market has already advanced close to 8/0 from the December low. Thus, the 1958 December bottom of 55.58 in the Standard & Poor Index becomes an important one to watch. If this low holds for the next six to eight weeks, or if an advance of 10/0 to around 61.00 is recorded, the likelihood of a down market in 1959 becomes less. So far, no deterioration in the uptrend is evident. EDMUND W. TAB ELL AWTamb WALSTON & CO. INC. ThiS mllTket letter is not. Ilnd under no circumstances IS to be construed as, an offer to sell or II sohCltatlOn to buy liny securilies referred to herem The information contained herem IS not guaranteed ns to accuracy or completeness and the furnlshmJ! thereof not, and under no eircumstnn-c!S i to be construed as, a repr!Sentn tl()n by '\\'nlston & Co, Inc. All expressIOns of OPinion arc 8ubJ!Ct to change \\Ithout nollce Walston & Co. Inc. and Officers, Directors, Stockholders and Emll1()yees ther(!Of, purchase, sell and may ha\e an Interest In the s(CUrItIes mentIOned herem ThiS market letter IS mtended and presented merely aj n general, mformal commentary on day to day market news and not as a comlliete analYSIS Additional mformatlOn With respect to any SeCurities referred to herein Will be upon r e q u e s t ' \\ N 30l i