Tabell’s Market Letter – December 28, 1962

r;- .' Walston &Co. —–Inc —– Xl/(' rOIl, Stock E.rclio.1Uj' NEW YORK SAN FRANCISCO LOS ANGELES PHILADELPHIA OHICES COAST TO COAST AND OVERSEAS CHICAGO TABEll'S MARKET lETTER December 28, 1962 For some years now, we have studied the famlliar seasonal tendency of the stock market to stage a year-end rally, and lt has been the custom of this letter each December to pomt out some of the conclus ions that can be denved from a study of thlS phenomenon. Last year we expanded this study to include every year since the Dow-Jones Industnal was first computed in 1897, and suggested that an exhaustive study of chart pattern over the past slxty-five years indicated tha t such a rally, however minuscule, had invar- iably taken place. The probability exists that the rally began this year at the December -19th low of 636.88 in the Dow-Jones Industrials. A number of interesting facts about market (1) As stated above, an ldentifiable year-end rally has taken place in every year since 1897. This rally has often been of great magnitude with advances as great as 280/0 having been recorded. It has also, On occaSlOn, conhnued with only minor interruptions for as long as six months into the new year. However, on other occasions it has been of only a few days duration, reachmg a top extremely early in the year. This occurred, of course, in 1962 when the high was reached in the very first day of the year. (2) ,There has been a persistent tendency for the rally to begin early in years when the market has been up and late when it has been down. If the rally truly began on December 19th this year, th1S tendency will agam hold gOOd. ' (3) The important tlung to watch in connection with market actlOn in the early months of the year is the low for the prevlOus December'S been broken in 39 years out of the past 64. In 23 of these 39 cases, it w s br nuary or February, and since 1937 it has never been broken later than acT ,lf the market is able D rto hold above its December low for the first 2 1/2 m n s of t ew year, chances become good that thlS low will not be broken 961, e emb'er 1960 low was never penetrated. (4) whee 'he eo h;okc 'he been downward two-thlrds 1S a typical case '- (5) The it an important clue as to the year's market trend. For example, an a 0 ore from the December lows has been by an upward or neutral k in the 31 years that such an advance nas occurred. An advance of less than 1 the December low before an 1dentifiable correction takes place has been follow ya downward market in 22 of 33 years. (6) The length of time in which the rally continues into the new year is also important. For example, in 17 years the ra lly has continued into March or later. In 15 of these 17 years the eventual trend was upward. Again, 1961 is a case in point. This leads to some rather interesting conclusions, and makes the December low of 636.88 in the Dow an interesting figure to watch. ( In Standard & Poor's 500-Stock Index the low was made earlier in December at 61. 28.) If the rally peters out early in January, and the aforementioned lows are broken, there is a strong presumption that 1963 will see a weak market. On the other hand, if the rally continues without an identifiable reversal until March, or if the averages advance 100/0 (to 700 in the Dow or 68 in the Standard & Poor's 500-Stock Index), it would be a possible'indication of an upward or neutral trenafor the year. Thus, the action of the various averages in relation to the December low. should be studied very carefully. Such action may well provide the first clue as to the action of tQe market in 1963. A HAPPY AND PROSPEROUS NEW YEAR TO ALL Dow-Jones Ind. 651. 43 Dow-Jones Ralls 140.00 ANTHONY W. TABELL WALSTON & CO. INC. Note Our revis.ed recomruE!n.ded lists of stocks, mentioned in las.t week's letter, maybe obtained from your Walston Account Executive at the end of next week. I hh lll.lll.ct lctte ,-. flot ,In,\ undc! nO to he ('''n tlllc,! lIll ,,If!!1 I ..II ' 11 … IIlI\,III1l In .Hl -.(' lilttle.. t hel ('In The InC, m.lt,n I fllllIllCd hcrCln nnt 1.'11I111\t,,,,\ II tu ,It( 111 H') ()! nnd fUI IIhllllll. tnl.'f 01, ,nt! IIndc, I , ,11111,111 ( I' In ,,,,,1111.1 ,I I C\ c'cntll' l'n \'Y \\'Jljton &. en hH' All lit \III1n .1' It!. \ t riMn,;c '\ltn,,1 ,,1 II l' \\',t!11 .. ( hI Ill, Offllel DII'(,,, SId,hhlcl ,.1101 I mp!nvn', therN!, )l(II.h.IC cll \nd mlY 1I.c ,III Illiere… t III the Illt'tll tlcd hII'1I1 Ihl' Illlllh.el lettm ' Intellt\cll .wel pleCllted mel ply 1\ ,I I.Pllc1,,1 I,,'uIlIfllllll.tl 'mment,lI) ,I d.IY tn d.l) m,IIke 11(\ .. UIlI! lIt ll\ fI ('mplet, .lnlll, … t\,ldlIT1,t! Inf, m,I,,,n ,th Ipe'l III ,111\ –'llIltH' I.f.llcd lu helclll 1\ ill I,c fllln, … 11,11'1 lelucl \\, ,Ill