Tabell’s Market Letter – March 06, 1959

fiLE COPV NEW YORK Walston &- Co. Inc Members New YOk Stock Exchange SAN FRANCISCO LOS ANGELES PHILADELPHIA CHICAGO OFFICES COAST TO COAST AND ABROAD TABELL'S MARKET LETTER March 6, 1959 It is probable that in every major rise in stock market history there has existed a school of theorists who have claimed the rise was unfounded and that perdition was around the corner. Thus,as the market continues to reach new high ground today, sophisticated analysts look upon the rise with skepticism and tend to lean more toward a conservative policy with every new upward surge of the Dow-Jones average. Technical theorists have never held with this approach, preferring to believe,along with the late Samuel Dow,that a trend.once established,tends to remain in force. Anoth r c;orn,e!.s!oneof technicalt!leQry is that hi,sto!'Yhproper1y)nterRreted,pr-qYldes , guide -to probable future events. In this -connection, and in answer to'that school of ana – lysts which fears a rising market, it is interesting to compare the current bull market upswing with similar upturns in the past. Such a comparison was made in our January 16th letter when it was pointed out at some length that, in every year since 1935, the low of the previous December was brcken early in the year or not at all. It was stressed, indeed, that never in those 23 years had the December low been broken after April. As March comes upon us there appears to be little likelihood of the December bottom in any of the averages being pene trated in the next few weeks. Another interesting study can be made dealing with the length and extent of the averf- age bull market. The following table, based on the Dow-Jones Industrials,lists the 14 major bull market ,upswings that have taken place since 1885, together with the number of months they continued and their percentage advance. Close students of the averages may wish to argue with our definitions of a bull market. In general, we have tried to lean to the side of conservatism, i. e., the 1921-1929 bull markets are broken into three phases, whereas many t e continuous upswir g Low 2296..1144 – Date High 74//22//8858 —3937.1.274 Date 5117 N. th 2 – ' – 3 242 .- – – – – – 20.90 8/8/96 56. 94 172 30.92 52.40 11/9/03 7/30/14 110. /co'f;)'1.tJ 27 28 144 110 65. 95 63.90 85.76 135.20 40.56 84.58 92.69 160.62 254.36 41fl.15 8/ 10/2 3 3/30/2 7/8/3 2/26/34 4/28/42 6/14/49 9/15/53 10/22/57 11\6 16 .10 111. 93 195.59 213.36 295.06 524.37 615.77 3/19 3/20/23 2/11/26 9/3/29 2/5/34 3/10/37 5/29/46 1/5/53 4/9/56 3/2/59 23 19 36 39 19 36 49 42 31 15 81 65 92 185 175 131 130 84 106 47 '' '' to date. From the above study a number of conclusions may be drawn. It will be notE d that, so far, the current bull market has lasted 15 months and advanced 470/0. In 14 previous bull markets the average length of time was 30 months and the median length 29.5 months. The average percentage advance was 1110/0 and the median percent advance was 108. The shortest of all bull markets under study was 17 months long and took place prior to the turn of the century. The smallest percentage rise was 320/0 also in the 1890. Measured against these figures it would appear that the current 15-month, 470/0 rise has been extremely moderate. Indeed, if it were to conf.)rm to the average, it would carry to April, 1960 and reach a high of 878. Whether these lofty figures will ce'attained is questionable, but it seems to be a proven fact that bull markets often continue far beyond the expectations of many investors. AWTat EDMUND W. TABELL WALSTON & CO. INC. ThiS market letter IS not, and under no circumstances 18 to be construed U5. an offer to sell or n soitCltatlOn to buy any securities referred to herem The informatIOn ('ontumed herem IS not guaranteed as to accuracy or completcnl!SS nnd the furnishing thereof 18 not, and under no cIrcumstances is to be construed as, a rcpr(!Senta- tlon h) \\'nlston & Co, Inc All e'ICpresslOns of opinIOn nrc subJect to change v,lthoul notIce 'alston & Co, Inc., and OffIcers, Directors, Stockholders nnd t-;mIJoyces therrof, purchase, sell nnd may have an mtere'lt 10 the secUrIties mentioned herem, Thl l1!arket letter IS Intendell and presented merely as a general, mformal commentary on ia to da)' market nevo'l! and not as a complete anaiyslb AddLilonailnformatlOn ltb respect to IIny seeuntll.'s referred to herein will be furnJshed upon r e q u e s t ' \\'N 30l