Tabell’s Market Letter – April 29, 1966

TABELL'S Wdlston &- Co. Inc INVESTMENT BANKERS MUTUAL fUNDS MUNICIPAL BONDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges OFfiCES COAST TO COAST AND OVERSEAS MARKET LnURT.n!…L April 29, 1966 The past week was one of general decline in the stock market. The Dow-Jones Indus- trial Average reacted from an intra-day peak of 961. 91 On April 21 to reach an intra-day low of 927.22 on Thursday. The Rail Average dropped off even more sharply from a peak of 264.23 to a low of 249.73. Essentially, the decline was unsurprising. The Industrial index retraced, roughly, two-thirds of the advance from March lows and brought the average back to strong support in the 930-920 area. Encouraging was the fact that the volume on the retracement dried up noticeably, reaching a low of 7,270,000 shares on Monday, whereas advancing volume had tended to approach or exceed the 10 million share level. It is likely that, after some further backing and filling, -the intermediate term a d v' a n- c -e-in the averages wlllresume. However, this will be far less important than the action of individual stocks. This letter has long held that we are in the advanced stages of a bull market which is a kind phras for being in the early stages of a market top. The euphemism is necessary because the word top has fearsome semantic connotations. Actually, much failure to understand the nature of the stock market stems from not recognizing that market tops and bottoms are not mirror images of the same thing, but are, in fact, quite different. Upside reversals take place quickly and dramatically. Tops, On the other hand, begin their formation long before the avrages start to go down and tend to build up gradually over a period of time. Generally, many stocks and industrial groups top out early while others continue their advance. As time goes on, more and more stocks have already reached their peaks and are in downtrends, whil fewer and fewer are still advancing. Essentially,we have of a stage today, and this is really what the analyst means when he says too el ill be vicious or that selection of individual stocks is the key to ace. As readers of this letter are aware, we have ntlya a number of stocks to various sections of our Recommended List. a oom for them we are removin from the list 11 issues.rWe have tabulated be e pro performance of these issues sinc Decemb.er 31,1964, .the!oase.date me thei, P!lrs..ent age change since that time There recommendatio the Dow-Jones Industrial er'\ttre- period. Of these recommendations, 77 ave advanced and 21 ed list itself, a ava' b r 1 e ormance record of the list, as well as t e curren ur Iston Account Executive. Obviously, no implication is made that such res c 1 tained by purchase of issues in the Recommended List, or that similar results wi b tained by purchase in the future. Commissions are not included Pric /31/64 or Date Recom. Current Price Change /0 Change DJIA same Time Period CAPITAL APPRECIATION LIST Beaunit Corp. 37 55 49 7 Canteen Corp. 19 (6/29/65) 31 1/2 66 11 First Charter 241/8 14 1/2 -40 7 Korvette 40 23 5/8 -41 7 Perkin – Elme r 24 (adj) 47 1/4 97 7 Swingline 18 3/4 (adj.) 381/2 105 7 SPECULATIVE-CAPITAL APPRECIATION LIST Audio Devices 17 1/8 37 1/2 119 7 Great West Fin. 11 1/2 8 . -31- 7 Hewlett Packard 22 5/8 50 121 7 Mohasco 141/8 251/4 79 7 Seaboard World Air. 6 243/4 313 7 Average 76. 1 7.4 It will be noted that of the issues being removed, most are up sharply, while three have shown substantial declines. Removal of these three is intended to reflect the fact that many investors will wish to use, or may have already used, losses in these issues to offset capital gains for income tax purposes. Actually, the issues in question appear rather sharply over- sold and it is possible that the investor may wish to defer taking losses until later in the yea Dow-Jones Ind. 933. 68 Dow-Jones Rails – 253. 682u( .. n ANTHONY W. TABELL WALSTON & CO. IOC. '0;ThiS market letter IS pubhshed (or your conventence and mformatlon and not an offer to sell or a solicitation to buy any &eCUfitlea discussed The in formation was obtained from source'! we bLiLeve to be rehable. but we do not gunrnntee Its f1ccurncy \VRlston & Co. Inc and Its officer! dlro..ctors or cmplo)eE'S may have an mtereHt in or purchase and sell the securities referred to herein. WNSOl \