Viewing Month: August 1967

Tabell’s Market Letter – August 04, 1967

Tabell’s Market Letter – August 04, 1967

Tabell's Market Letter - August 04, 1967
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W—a-l-sltnocn.-&-C–o-. MUNICIPAL BONOS UNDERWRITERS MUTUAL FUNDS Members New York Stock Exchenge end Other Principe I Stock end Commodity Exchenges OFFICES COAST TO COAST AND OVERSEAS TABELL'S MARKET LETTER August 4, rlLt 1967 Last week saw a good deal of highly significant action in the equity market — – action perhaps more significant than has occurred at any time since early January. The first three days of the week saw a dramatic rally with the Dow-Jones Industrials up over twenty points in three trading sessions on record high volume. Leadership was quite obviously concentrated in the investment-grade sector of the market as the majority of performance stocks continued to deteriorate markedly. On Thursday, the announcement of President Johnson's decision to request a 10 tax surcharge saw the Dow down close to ten points at noon, but asharprecovery er-asedalmostcthe entire,decline,-and the advance . continued on Friday, reaching an intra-day peak of 931. 06. The action was highly reminiscent of the behavior of the market on January 11, 1967, the day after the tax increase was first proposed in President Johnson's State-of-the Union message. On that day, after a sharp decline in the first hour, the market rallied sharply to end the day on the plus side, thus touching off the 1967 upswing. In last week's action, the popular indices broke decisively out of the trading ranges in which they had been contained since February. Regular readers of this letter will recall the stress that has been placed for the past two months on these ranges, and the fact that the direction of the ultimate breakout from these trading areas would probably indicate the inter- mediate-term course of the market. That breakout has now taken place on the upside. Thus, two of the most important market weeks of 1967 are connected intimately with S 'the tax increase. Obviously, the underlying theory is quite Administra..tion be- lieves that the economic downtrend which began in 19 e ct, run its course and that the major danger in late 1967 and 1968 will f .g flationary fires by a large, Vietnam -caused government deficit. The tax . direct effort to reduce that deficit and thus allow the Federal ursue the expansionary policy it has pursued since last October. ,ns is concerned, is that, in this sort of envLronment, t e n ,,1;1 very in 1968 could be quite drama tic — possibly enough to offset the a add to earnings in a great many cases. Last January, whe e'Wbf tax increase first came up, this letter used the following language t 0 in this case, we think, is not so much the ultimate economic effect of ttl cu , he cold hard fact of the market's response to it. What the stock market is, in ac ying by its sharp advance last week, is that it is willing to adhere, at least for the e being, to the Johnsonian idea that the 1967 contraction will be both mild and short. is also recognizing the fact, both implicit and explicit in the Presi- dent's speech, that tight money is a thing of the past and that the pressure on common stock prices due to much higher yields available elsewhere will very shortly be eased substantially! We think the words bear repeating at this time. The action of the market over the past week, to us, reflects continued confidence in the Administration's belief that the spectre of recess- ion has been laid to rest and the outlook is for further economic expansion in the fourth quar- ter of 1967 and on into 1968. It is, of course, the cyclical and semi-cyclical investment-grade companies who can be expected to be the chief beneficiaries of such an economic climate and it is Significant that, at this point in time, the to companies of this type. The market is obviously well past the so-called non-selective stage where almost everything does more or less well, and in order to achieve investment success in the latter half of 1967, some radical shifts will probably be necessary in a great many portfolios. In accordance with this thinking, we will continue next week with the review of individual industry groups started in last week's letter. Dow-JrJnes Ind. 923.77 Dow-Jones Rails 274.49 ANTHONY W. TABELL WALSTON & CO. INC. AWTamb Thill market letter ia pubhshed for your Ionvenlenee Bnd Information Rnd ig not an offer to sell or a soliCitation to buy Bny IM.CUTltle8 .hscuued The in. formation Was emDtoyee8 may obtained from BOurces we believe to be but have an Interest in or pUFchMe and sell the seeurltlf!'ll we refe rdroedntoot gullrantee heIeln Its accuracy Walston & Co., Inc. and Its officers. directors or WNBOl

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Tabell’s Market Letter – August 11, 1967

Tabell’s Market Letter – August 11, 1967

Tabell's Market Letter - August 11, 1967
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r——cc——–c-c— .-….-..-.— W—a-lIsntocn.-&-C–o-. MUNICIPAL BONDS UNDERWRITERS MUTUAL FUNDS Membe.. New York Stock Exchange and Other Principal Stock and Commodity Exchange. TABEll'S MARKET lETTER OFFICES COA,ST TO COAST AND OVERSEAS August 11, 1967 Irregularity featured last week's market, which included four shortened trading ses- sions due to the pile-up of back office work in brokerage firms. Weakness on Friday brough the Dow-Jones Industrials down to an intra-day low of 915.57. As outlined in recent letters, probabilities seem to favor a continued uptrend wit h further dominance on the part of investment-grade issues. However, the sharp runup from the early July lows (the sharpest short-term advance since January), may require some consolidation or correction before the major upward trend resumes. We are continuing be- low with our review of individual industry groups. Issues marked with an asterisk () are on'our DEPARTMENT STORES – Distinct signs of a major reversal are appearing in this group and they should be considered for accumulation by patient quality-minded investors. Federated Department Stores appears the most interesting. DRUGS – Group action, both relative and actual, is good, but there is wide disparity in individual technical patterns. Upside objectives are being reached in most hospital supply and proprietary drug issues, but no signs of pronounced deterioration are apparent. Sterling Drug continues attractive. ELECTRICAL EQUIPMENT – A very interesting group which shows signs of having reversed itself rather quickly after the 1966 slide. General Electric has a possible upside objective of 160, although supply at 110-120 may stall The action of West inghouse is also interesting. ELECTRONICS – Technical patterns in this 0 ia ny of the issues in the group which have led the upswing so far are rea . obj i such as ,Hewlett-Packard Foxboro and Perkin-Elmer. Fairchild Camera ook k should be avoided. Texas Instruments is close to support at the 120 Ie sti a long-term higher objective. . . -. FOOD – Some very int e patterns in this group. Del Monte has an upside objectiv i tiE n General Foods can be accumulated in investment accounts. United u e look higher. GLASS – N c r raction in major companies at this time. LIQUOR – Gro rs to be completing base patterns, but more time is probably needed and would defe purchases for time being. MACHINE TO LS – Despite sharp runup, group continues attractive and most issues should be held. MACHINERY – Patterns are diverse. Caterpillar Tractor is interesting with object- ive in the upper 60's. MAIL ORDER – Montgomery Ward will probably be slow. Sears Roebuck may re- quire more time to complete base. MEAT PACKING – Some relative improvement is being evidenced. Swift could be in- teresting at this point. MINING – Copper stocks are showing distinctly improving action. Both Anaconda an Kennecott could be purchased in moderate risk accounts. MOTION PICTURE – Relative action has been good; but the better acting issues are beginning to approach upside potentials. Would hesitate to make new purchases at these levels. NATURAL GAS – Group will probably cont inue slow for the time being, although long- term potentials are considerably above current levels. OFFICE EQUIPMENT – As a group, these issues. continue to show above-average relative strength. However, many, including the volatile Control Data, IBM and Burroughs, have reached upside objectives. National Cash Register , however, continues to look higher – as does Pitney-Bowes. Based on recent action, further weakness in Xerox is a possibility. Dow-Jones Ind. – 920. 65 Dow-Jones Rails – 262.04 ANTHONY W. TABELL WALSTON & CO. INC. AWT'a mb This market letter III pubU8hed for your convenience and InformatIOn ftnd is not an offer to sell or a soliCitation to buy an)' aeeurltiee dlseussed. The inefomrmplaotyJeoens mwaays hoabvtaeinaend IfnrtoemrestlOinuroeers pwurechase andtosebllethreelisaebclue.r.ibtiuest rweeferdroedntoot hgeUraeirna.ntee Its aceumcy, Walston & Co.. Inc. and its ofIicera, direeton or WN101

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Tabell’s Market Letter – August 18, 1967

Tabell’s Market Letter – August 18, 1967

Tabell's Market Letter - August 18, 1967
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Walston &Co. —–Inc ;-.— MUNICIPAL BONllS UNDERWRITERS MUTUAL FUNDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchanges TABELL'S MARKET LETTER OFFICES COAST TO COAST AND OVERSEAS August 18, 1.–1 L 1967 As measured by the popular averages, the stock market did little or nothing during last week as shortened trading sessions continued to curtail volume. The Dow-Jones Indus- trial Average closed the week at 919.04, virtually unchanged from the week-earlier close at 920.65. The Rail and utility Averages slipped slightly lower. Despite the dullness, there is wide diversity in the action of individual stocks. So- called glamour issues continued to fade and to exhibit marked technical deterioration while in general, better-grade stocks held firm or advanced. This sort of action has been typical over the,past few weeks and\Ve\Vould,epect its in.the.future. . As a guide to investors who wish to'upgrade their portfolios, we are concluding be- low our review on major industry groups. Investors having specific questions on stocks not mentioned in this or the past two letters, may contact their Walston representative for details. Issues marked with an asterisk () are on our Recommended List. OILS – Varying degrees of attractiveness exist in all segments of the oil industry. In the Producing segment, Amerada was added to our Recommended List when it reached a buying level of 80 earlier this week. It has an upside objective of 140. While the Domestic Oils have not been spectacular, they have, nonetheless, exhibited steady strength over the past year and continue to be strong holds in investment-grade accounts. Continental Oil , Cities Service, Phillips Petroleum and Shell Oil should be retained and can be bought on minor dips. In the International Oil field, Gulf Oil only really strong stock and should be held for a long-term objective of 92. Dutch and Standard Oil of New Jersey may be bast3!. be slow. II. Gj' OIL WELL SUPPLY – Dresser Industr' , ger , with a longer term objective of 110, a e ttr er evidence tin t Royal t oug . mediate. action may – jective of 57, and Schlumber e. action tinue to feel that patience fairly priced for the patient Ion t one of the more intere h waPHOTOGR s- but'we conand International Paper appear de,\ Great Northern Paper continues to be a risk situations. ng-term growth potential of Eastman Kodak and Pola- roid is undoubtedly tlie . PiE's and deteriorating short-term action make the im- mediate picture questio Would defer new purchases until some indication of technical improvement takes pla RADIO-TV – There are definite signs that this group may have completed base pat- terns. Radio Corporation and Zenith look particularly attractive. RAILS – Group action is mixed, but, in general, merger rails appear to have above- average technical attraction. This would include Seaboard Coast Line , Pennsylvania, New York Central, Great Northern and Northern Pacific. — SAVINGS & LOANS – Potentially strong patterns are forming, but there is some question as to whether more work may not be needed. SOAPS – Colgate-Palmolive continues att ractive. Procter & Gamble may be held. SOFT DRINKS – Major stocks appear adequately priced at this point. STEELS – Relatively, this has been one of the best acting groups in the market on a short-term basis, and it remains'tobe seen whether this can transiate itself into long-term relative improvement. Copperweld , Sharon and Republic Steel appear to be attractive vehicles. SUPERMARKETS – More work will be needed, and group can be avoided for the time being. TEXTILES – In most cases, we would doubt if recent short-term strength will develop into a major move. TOBACCO – Most stocks appear to represent excellent value at this stage. American Tobacco, Lorillard and Reynolds Tobacco appear interesting for investment accounts. UTILITIES – Group represents long-term value, but there is no indication of an im- mediate move. Dow-Jones Ind. 919.04 ANTHONY W. TAB ELL WALSTON & CO. INC. Dow-Jones Rails 258.07 Thll! market letter III published for your formation WE18 obtained from 80urces we believe to and information Rnd 18 not an offer be reliable. but we do not guarantee to sell or a BOilcilation to buy its 3ccuraey Walston & Co., Rny Ine. asnecduriuitieosffdiclearesu.ssdeidr.ecTtohres inor AWT'a b!!!I'p'loyees may have an Intereat In or purchase and sell the securities referred to herein. W H. . . I

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Tabell’s Market Letter – August 25, 1967

Tabell’s Market Letter – August 25, 1967

Tabell's Market Letter - August 25, 1967
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Walston &Co. MUNICIPAL BONDS UNDERWRITERS MUTUAL fUNDS Members New York Stock Exchange and Other Principal Stock and Commodity Exchange. TABEll'S MARKET lETTER OFFICES COAST TO COAST AND OVERSEAS August 25, 1967 Equity markets were generally reactionary throughout most of the past week. The Dow-Jones Industrial Average posted declines on all five days of the week, although volume dried up noticeably on the downswing. It is interesting to note that the return to full sessions brought generally lower volume than had occurred in the prior two weeks when the 2 p, M. closing was in effect. At Friday's low of 888.81, the Dow had declined 4.8 from its August 10th high and had retraced a bit more than half the advance from the July low to the August peak. The de- cline was the fifth identifiable downswing that has taken place so far in 1967 and, to date, has failed,to,develop.a ny-characteristics.which.differentiate it.from,the.previousfour. – Thefollow ing table, which gives some data on the five short-term rallies and declines which have characterized 1967 so far, may be of some interest. RALLIES DECLINES DJlA Date High Change From From Prevo Low High No. Of Days DJlA Date Low Decline No. Of Retracement Day Jan. 4 776 16 Feb. 9 871.71 Mar.27 883.41 May. 9 915.87 Jun.16 892. 80 12. 3 6. 7 9.2 6. 7 5. 4 1.3 3.7 -2. 5 26 Feb. 28 827.95 5.0 18 Apr. 11 838. 98 5.0 22 Jun. 5 836. 92 8.6 9 Jul. 3 853.21 4.4 45 80 103 54 11 10 18 11 Aug.10 933. 14 10. 9 4.5 26 Aug. 25 to date. W 80 56 11 Before discussing the present downswing it . e amine the rally which preceded it. As the table shows, the advance which in e July and ended on the 10th of August was the second most dynamic alling only slightly short of the January,Februa.ly-upswing.in r e e trading Wdays. As we pointed out three weeks r as significant in a number of ways. Firs of all, it brought the Dow e range which had contained it since Febru- ary. Secondly, it breach pp Y which existed between 860 and 910 dating back to the May-July 196 t d n . hermore, this advance was accompanied by confirm- ation in weekly brea . a ook place on gratifyingly heavy volume. Its significance was important at that e do not believe that significance has altered today. Naturally enough advance of this nature produced an overbought condition on a short-term basis, and orne correction or consolidation was inevitable. What has ensued so far is hardly out of line with the shorter term corrections which have characterized the year so far. The percentage decline so far has been about the same as the February, April and June declines and has been somewhat less than the 8.6 drop chalked up at the time of the Middle East crisis. The eleven trading days duration is about the same as in all the declines but May-June, and the percentage retracement is, so far, in line with two of the previOUS downswings. At the moment, our short-term oscillator has reached oversold territory, although no recovery indication has taken place as yet. One downside objective has been reached, althoug there is a possible 880-870 in the pattern. This would constitute a 70 to 80 retracement of the overall advance – – again not'6litcif-line' with- 1-967'experience– Meanwhile, while all this has been going on in termS of the averages, a distinct chang in the character of the market has been taking place. This can be best illustrated by com- paring the action of two stocks — Xerox, a growth stock par excell,ence, whi;h sells t an as- tronomical p/ e ratio and yields next to nothing, and Anaconda, hLghly cyclLcal, WhLCh sells at a low price/ earnings ratio and yields over 5. Xerox scored new highs along with the Dow at the February, March, May and June peaks, but failed to parti,cipate in, the Au- gust rally and recently posted a new low below any prevLOus bottom made smce April. Ana- conda, by contrast, which failed to better its February peak in either March or May, scored new highs in both the June and August rallies and is still well above its erly July bot tom. Looked at another way, the investor who bought Xerox at LtS low of last Aprtl, currently has a loss, while the buyer of Anaconda has a 20 profit. It is highly likely that this kind of shift will continue regardless of what kind of overall market pattern develops. Dow-Jones Ind. – 894.07 Dow-Jones Rails – 256.96 ANTHONY W. TABELL WALSTON & CO. INC. bThis market letter ia published for your convenience and information Rnd is not an offer to sell or a soliCItation to buy any formation emgloyeetl was mIL)' obtamed from sources we believe to be reliable, but have an interest in or pUl'chaae and &ell the seCuTltlea we refe rdroedntoot guarantee herem. its accuracy. Walston & Co., Inc. asnedeuritiatleosfBdeiaecrus,aadeidr.eeTtohrea or WN,IO'

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