, ,l————–I I TABELL'S j MARKET LETTER L – , 909 STATE ROAD, PRINCETON, NEW .JERSEY 081540 DIVISION Of' MEMBEA NEW YORK STOCK EXCHANQE. INC MEMBEA ….MERICAN STOCK EXCHANGE June 4, 1971 / ,ThLe ,is. an axiom ,.IQng ,familiarctopFact4cing'teehniciansrthat-the -market 'wtU-alwais- do – – that which makes the analyst's job the most frustrating. This week's action, which saw equity markets rebound sharply from last week's intra-day low of 899.94 on the Dow to an intra-day high of 929.60 on Thursday, proved nO exception to the old saw. We suggested in last week's letter that a market forecast would have been much simpler had the move been in the other direction, 1. e., had the Dow moved on to new lows instead of reversing its course this week. Such a decline, we suggested, would have been unlikely to prove severe and would have, in our view, provided a minimum-f'isk buying opportunity. How- ever, the market refused to accommodate and chose to rebound from the deep oversold condition which, on a short-term basis, existed at the end of last week. The psychology behind the May weakness and, by extension, last week's strength is in- teresting. The month-long 5 downswing coincided with the first major weakness in bond markets since the sharp decline in interest rates began last summer. Likewise, the market turned on news of a firming bond market and the suggestion by a number of econOmists that the decline in senior securities was about over, and prices might well be significantly higher by the end of the year. This is yet another demonstration of how deeply the experience of 1969-1970 is seared into the minds of most investors. Those years saw a major bear market in equities, caused in large part by stringent monetary pressures, skyrocketing interest rates, and chaotic bond markets. At the first sign of a repetition of these conditions, even on a drastically reduced scale, the market responded by moving lower. , claile oTthe- re'as;;;;7 ;ourse, why bear markets catch so many unprepared- is that memories are short. Investors are always most sensitive to the conditions which brought about the last bear market and tend to forget that downswings can be caused by a variety of factors. 1957, for example, was related to a rather steep business recession to a degree not paralleled by any subsequent bear market. 1962 was unrelated to anything taking place in the economy or the money markets and was purely technical,reflecting the fact that stocks had reached untenably high prices despite a fundamentally sound Outlook. What the root causes of the next bear market will be it is impossible, at this pOint in time, to say. But we are willing to hazard a guess that they will be entirely different than the factors which brought about 1969-1970. And those who sat through the 1970-197 advance nervously awaiting a return of 1969-1970 conditions will, not surprisingly, be caught unawares. Meanwhile, whither away The time has COme, we think, when a little mild hedging is in order. Mter the first full-scale technical cc.rrection in 10 months, we now have a benchmark by which to measure the equity market's future performance. Were the present rally to continue on good breadth and volume, ultimately forming the sort of base that would indicate a move to new highs, the continuance of the major upswing would be strongly indicated. On the other hand, as we have been suggesting for the past two weeks, potential distribution does, in fact, exist and wc.uld be further broadened by a weak rally. This distribution could make the upswing more vulnerable than it has been at any time in the past. – – For the pres'erit,-at leaSt; weare willlng;-fro'm'a pOlicY1Joint'of'-view,-to-operate- onthe-.–,-I- . assumption that the present test will be passed successfully and that,after some conSOlidation, new highs will be duly recorded. Part of this optimism is centered around the largely spuriOUS nature of the recent weakness — spuriOUS, in that, as suggested above, it was based on fears that were essentially unreal. Another cause for optimism is the fact that the nascent business recovery has not, in our view, been reflected in the price of a good many issues, notably those cyclical stocks which have the most to gain from a business upturn. This is, interestingly enough, reflected in the technical patterns of a great many cyclical companies, which withstood the decline well and are rallying smartly. Such issues deserve a place in portfolio policy, a policy which still, in our opinion, should center around a strong commitment to equities. DOw-Jones Industrial (1100 a.m.) 920.53 S&P (1100 a.m.) 101.07 AWTmn ANTHONY W. TAB ELL DELAFIELD, HARVEY, TAB ELL No Iotemenl or expression of opinion or any other motter herelr contained IS, or IS 10 be deemed 10 be, dlrec'Jy or indirectly, on offer or the sollcllallon of on offer 10 buy or s.ell any security referred fo or mentioned The molter IS presenled merely for the conveflenct of the subSCriber White oNe believe the wurces of our mformotlon to be reliable, we In no W'lY represent or guorantee the accuracy thereof nor of the statements mude herem Any 'let Ion to be token by the s.ubscrlber sholild be based on hiS own investigation and ,nforma!lon Janney Montgomery Seo!, Inc, os 'l corporotlon, and lis offICers or employees, may now have, or may later take, poSitIOns or tr'ldes In respect to 'lny secufilies mentioned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter expressed m thiS or any other luue Jonney Montgomery Seoll, Inc, whICh IS registered with the SEC as on Investment 'ldvisor, may give adVICe to la mvestment adVISOry and othel cvstamers Independently of any ilatemena mode In Ihn or m any other Issue Further information on any security mentioned herem IS aVailable on request ———

TABELL'S MARKET \ I LETTER L! . eo. STATE ROAD, IDRINCETON, NEW JERaEY 08540 DIVISION 0 .. MEMS' NEW YO ..K STOCK EXCHANGE. INC MEMSEft AME ..ICAN IITOCK EXCHANQE — '-111 a-move whilih-attracted 'very lithe nOtice- (a exception''was hexc'clle/i!'b91- ', Alfred L. Malabre, Jr., in Monday's Wall Street Journal) the prestigous National Bureau of Economic Research has officially designated the 13-month period from November, 1969 through November, 1970 as a recession. It was the 27th recession since the N.B.E.R. began recording them back to 1854 and the fifth official recession of the post-World-War-II period. The timing is interesting. The recession was not officially recognized around the end of 1969 when it began. It was not recognized in the Fall of 1970, at which point real GNP had been flat or declining for four quarters and corporate prcfits had been sliding fer almost two years. It was not, in fact, recognized until six months after the whole dreary affair was over. Now this is no criticism of the N.B.E.R., whose function, after all, is to keep the histori- cal record straight. What it does illustrate, however, is the total folly of attempting to relate economic developments to the intermediate-term course of the stock market and of trying to forecast the course of stock prices on the basis of the business cycle or the short-term trend of corporate profits. Again, recall the timing. The recession began in November, 1969. At that pOint, the Dow-Jenes Industrial Average was 11 months past its high, having peaked out around 995 in December, 1968 and having dropped over 220 pOints to around 770 by the end of Novem- ber. Indeed, by that time some two-thirds of the total drop was over with, the last third com- ing with the final fall to 631 in May, 1970, which, it will be recalled, was six months before the recession was finally over. By the time the recession actually ended,in November.of la!;t – year, tlieD-ow was up f60 pOints trom its low, and when the end was finally recognized in May, . – it had moved up another 160 pOints. Nor was there anything unusual about this process. The 1953-1954 recession began in July, 1953 and ended in August, 1954. Stock prices peaked in January, 1953, six months before the recession began and bottomed in September, 1953, just two months after it started and 11 months before it was over. By the end of the recession, the Dow had moved from 195 to 354. In 1957-1958 prices peaked two years before the onset of thecontraction and bottomed six months before it had ended. At the recession's end, the Dow had already moved from 416 to 456 and within six months had moved 100 pOints higher still. The same sort of record was shown in 1960-1961. As measured by the S&P, stock prices peaked almost a year before the re- cession commenced and, by the time it was over in February, 1961, most indices had already moved to definitive new highs. Thus, the 1970-1971 experience is a perfectly normal one with- in the context of the post-war period. Yet, despite all this, we were being assured repeatedly, as stocks hit their Iowa year ago, that equities were poor investments because we were in a recession, and we are being assured, with equal convinction, today that stocks are a buy because the current outlook calls for continued expansion. For ourselves, we prefer to be guided by the historical record. In 1954-1956, stock prices continued to move ahead for almost two years after the end of the recession and in 1958-1959 they continued expanding for about a year and a half. In 1960-1961, the expansion continued .,. 'f021O -months a-fter'thecemlOf the economic'down-swing'– –.- —.,….- .o- – —– – Now one obvious conclusion from the figures above is that the periods of expansion following the reversal of economic downturns seem to be getting shorter. This is, in our view, an acceleration of the anticipation process suggested above, Le., prices are discounting re- coveries a great deal faster than they have in the past. Even so, the record does suggest that the discounting process is not yet fully completed. It is only, after all, six months since the now-recognized centraction came to an end thus suggesting, at a minimum, a continued good market on into the Fall. By that time, no doubt, the economy will have improved even more markedly and the outlook for 1972 earnings will be excellent. We will prefer, however, to allow the market itself, through its own technical condition, to tell us what the prospects are for continued advance. Dow-Jones Industrial (1100 a.m.) 917.28 S&P (1100 a.m.) 100.88 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL AWTmn No statement or expression of opinion or any other molter herem contolned 15, or IS to be deemed to be, dlreCliy or Indirectly, on offer or the Olleltotlon of on offer to buy or sell any security referred 10 or mentioned The motler IS presented merely for the convellenc of the subSCriber While oNe believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the Iotement mude herein Any ocllon to be token by the subSCriber should be based an hIS own investigation and information Janney Montgomery 5011, inc, 05 a corporation, and lIs officers or employees, may now have, or may later take, POSitiOns or trades In respect to any SKurttles mentioned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter eprcued In thiS or any other Inue Janney Montgomery 5ott, Inc, which IS registered With the SEC 05 on Investment adVisor, may give adVice 10 ItS .nvestment adVISOry and other customen Independently of any statements mode In thiS or .n any other Issue Furlher IfIformotlon on any seamty mentioned heretn IS avolloble on request

TABELL'S MARKET LETTER I I 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEM8ER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE June 18, 1971 . There are times, and the present, we freely admit, is one of thE)m, when.themaret analyst ''' ould prefer to tie spared the task-offssuing'aforecasto2' t'fC;ced tssue one-;- tc-s;;-rrc'und ' said forecast with enough hedging so as to leave an out for almost any possible contingency. There can be little doubt, indeed, that the mood of the equity market has changed dramatically from the heady days of the last half of 1970 and the Spring of 1971. Part of the lassitude stems from the fact that almost two months, 37 trading days, have passed since the market last made a new bull market high at the end of April, making the present period the longest interruption in the advance since the May, 1970 lows. But there is more to it than that. It is only necessary to glance at the chart of the Dow Jones Averages in the Wall Street Journal to see that the period from March to date looks suspiciously like somebody's textbook example of a head-and-shoulders top. Now of course, since technical analysis, fortunately or unfortunately, has become popular, everybody and his little brother has learned to recognize textbock head-and-shoulders tops. This tend s to make the formation somewhat more of an object of sus picion than it might have been a decade ago. But widely recognized or not, it is there nonetheless. More sophisticated indicators, unfortunately, tell the same story. Readers are aware it is our practice mathematically to COmpute and identify trends on the major averages. It is now quite evident that the uptrend which existed from May 26 to the end of April, carrying the Dow ahead some 50, has now been decisively violated. Now, of course, it is quite possible that such a violation Signifies nothing more than the fact that the advance will continue — albeit at a slower rate, Such has been the outcome of like trend violations on a number of previous occa- siQns,,–Xet,violat1ons,oithisature.hayealso,ilL.the.pa!t,beenam9ngtheearliestharbingers of major difficulty developing in the stock market. As such, we are inclined to treat them with respect. And yet, despite all this, we find ourselves unable to suppress the feeling that the market is acting a great deal better just beneath the surface than is apparent at first glance. Market breadth, of course, has deteriorated since April, but breadth figures are a great deal better than One would expect them to be at the termination of an upswing. Public skepticism, as odd lot sales rise in the face of each decline, is evident, A healthy number of Sizeable blocks continue to trade at upside price concessions. And, most importantly, the amount of distribution that has taken place in individual stock patterns remains surprisingly small cOnsidering the action of the averages. The market, in summary, gives us the impression of looking for an excuse to go up. We are reminded, in a way, of the Spring of 1968 when the market had displayed an even more prctracted (6 months) period of dullness. During the period, so-called Peace stocks tended to show out- standing technical action. And when the event to light the fuse, the announcement that President Johnson would not seek reelection, occurred, the resultant April Fools Day rally was truly dynamic. Looking at individual technical patterns, the operative catchilhrase at the moment appears not to be Peace but, Industrial Recovery. The stocks showing the best current technical action tend to be heavy-industry, cyclical issues, together with a sprinkling of classic growth stocks, whose,growth rate has temporarily slowed and can be expected to improve under conditions of a – – cyclical'recovery.-It' is 'hard' to 'imagine'the nature-of a' single event com'parable;to the' Johnson– announcement which could touch off a rally in stocks of this ilk, but this, of course, is what lends such events their surprise quality. Perhaps the most convincing argument for cautious optimism at this stage is that it isn't likely to cost too much. Let us assume the conventional interpretation of the head-and-shouldens top mentioned above. The worst possible downside objective if the top is violated (and the violation is real — false breakouts from widely-recognized formations are a notoriously common occurrence) is nOw the 860-850 level, a decline of a bit more than 5 from current prices. This would hardly constitute Armageddon. Moreover, there are enough stocks around where little distribution appears in eVidence, that we find no want of areas where we are comfortable about having money invested. The bull market has unquestionably been down for the past couple of months, but we suspect it may be a bit early to start counting it out. Dow-Jones Industrial (1100 a.m.) 901.43 ANTHONYW. TAB ELL S&P (1100 a.m.) 100.10 !,WTmn DELAFIELD, HARVEY, TAB ELL No statement or expression of opinion or any other matter he'e'n con'alned IS, or .s to be deemed to be, d,rely or II'Idnectly, on offer or the sol,c,lollon of on offer to buy or sell any secunty referred to or ment.oned The matter .5 presented merely for tre convellenc of Ihe subscrober While -Ne believe Ihe SOlJrces of our .nformo lion to be reliable, we ,n no way represen' or guarantee the o'Curocy thereof nor of the statements rTude herem Any action to be loken by Ihe subcnber should be based on hiS own inVestigation and Informal Ion Janney Montgomery Scoll, Inc, os a cor;orc!lon, ond Its o'fleers cr employees, may now have, Of may later toke, positions or trades In respect to any secvrilies mentioned In tts or O'ly future Issue, and such 005,t,0'1 may be d,ffe'ent fro'll any views now or hereafter expressed In Ih,s or any other IHue Janney Montgomery Scot, Inc, which 15 registered With the SEC as C'1 mvestment ocvlsor, may gIVe adVice to lIS Investment adVISOry and othel customers Independently of any statemenls mode In thiS r In anv o'her Issue Further In'ormO'ICI' on any security mentIOned herein IS aVailable on requesl

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGe June 25, 1971 .y.re cSJrtedlast.ee!.s,ClIket, coml)1eDt b,,-, expres,sing,the-Owishthat we,could ,completelyc,…., hedge our market forecast. We would 'have been better off had we done so. While we noted that a potential head-and-shoulders top existed on the Dow, we suggested that the top formation might be false and expressed cautious optimism as to the possibility of the market's recovery. Approximately half an hour after the letter went to press, the May mutual fund figures show- ing an excess of redemptions over sales were released, and the mar ket plunged into its steep- est drop in over a year, plummeting 17 pOints on Friday, 12 on Monday, and another couple of points in wide gyrations on Tuesday. The market firmed at midweek. We noted last week that the conventional interpretation of the head-and-shoulders top would call for a downside objective of 860-850 and now, obviously, any forecast model should be based on the assumption of a decline to that area. Again, in last week's letter, we stated that a tendency toward optimism was not likely to be too costly and we are still inclined to feel that way, since the distribution which took place between March and May, both in the averages and individual stocks, does not appear to be great enough to justify a decline of much greater magnitude at this time. In summary, while we are doubtful that the drop from the April highs is yet complete, we would be willing to use any further extension of the decline to make further purchases. The market, as always, is no respecter of man's leisure. As we are about to leave on a three-week vacation, we find it in the midst of the largest drop since the bull market began 13 months ago. Nonetheless, we are little worried about disaster occurring in our absence. Our ;;; 'b-e'stlr,s-S-isth1'frwl1l.lFtl'Mm'arket mayoelower at some PbintUr1ng oursoloutn, it is iik'el-!y''- to be at about the same level on our return. In our letter of May 21, we outlined five different courses the market could take over the short to intermediate term. These were 1) A Continued Bull Market, 2) A Major Bear Market, 3) A Surprise Decline, 4) A Protracted Trading Range, and,S) A Selective Downswing. Sub- sequent evidence indicates the liklihood of the third scenario, the so-called surprise decline. In Discussing that possibility last month, we said The most obViOUS example was 1965 where, in MaY-June, the Dow dropped over 100 points in 33 trading days and then recover- ed to stage the final dynamic upthrust of the 1962-1966 bull market. We are probably early in the game for this one, but it could occur, and its probability would be signaled by a drop below the 900 level. As suggested above, if such a drop were to occur at this stage, all downside targets suggested by current distributional tops would be reached, and a strong buying oppor- tunity would be pres ented. We see little reason at the present time to change that conclusion. As things have devel- oped, the resemblance to that 1965 pattern is, in fact, eerie. The present drop began from a clOSing level of 950.82. The one in 1965 began from 939.62. The former high was reached on May 14, 1965 whereas this year it was just two weeks earlier, on April 30. The ultimate low reached that year was 840.59 on June 28, whereas our low to date has been 876 on June 21. Except for the fact that the current decline has taken a bit longer, the patterns of the two .. …, correction,s,bear.an,almost.exact similarity,,.-,,–,,-. – '- — Looking ahead, we tend to think that the aftermath will be similar. In 1965, the market continued ahead modestly to score the top of the 1966 bull market in February of that year. At that time, the leadership of this terminal phase was purely speculative and, while the Dow moved ahead only modestly, Fairchild Camera, to pick one example, went from a June low of 36 to a February high of 217. Based on the current evidence, we would expect a similar re- covery at this stage, if one occurs, to feature less speculative leadership and better relative action on the part of the Dow. However, the pattern, as the correction and the subsequent base formation unfold, will give us a better clue as to the precise source of such leadership. NOTE The next three issues of this letter, in our absence, will include reviews by our aSSOCiate, Ronald Baron, of stocks with attractive fundamental and technical patterns. Dow-Jones Industrial (1100 a.m.) 875.88 SSP (1100 a.m.) 97.94 AWTmn ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL No statement or expreSton of opinion or any other molter herein contolned IS, or IS 0 be deemed to be, dIrectly or tndlre!;lly. an offer or the SOllCllotlon of on offer to buy or sell any security referred to or menhoned The motler IS presented merely for Ihe Convellena; of the subscriber While Ne believe the sources of our mformo- lion to be reliable, we In no way represent or guarantee the accuracy thereof nor of the sto'emenls mude herein Any aellon to be token by the subscnber should be based on hiS own mvesllgatlon and Informallon Janney Montgomery Scott, Inc, 0 a corporal lon, and ,Is officers or employees, may now have, or may laler loke, pOlttons or trades In re1pect 10 any seCUrities mentioned In thiS or any futvre Issue, ond such pOSition may be d,fferent from any views now or hereafter e)'pressed III thiS or any other Issue Janney Montgomery Scott, Illc , which 1 registered With the SEC as an mvestment adVisor, moy give ad\/lce 10 lIs Inveslmel'll adVisory and Olhel customers mdependently of any STatements mode 10 Ih,s or 10 any other Issue Further mformatlon on any secunty mentIOned herein IS available on requet

TABELL-S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08640 DIVISION OF' MEMBER NEW VOAI( STOCK eXCHANGE, INC MEM8ER AMERICAN STOCK EXCHA.NGE Our colleague, Anthony Tabell, had hardly disembarked in Europe on his wellearned vacation when the stock market began a recovery from its recent sharp decline, closing at 873.10 on June 28th. As indicated in last week's letter, at least a portion of the recent decline must be attributed to the Investment Company Institute figures showing that mutual fund s were in net redemptions in May, for the first time in history. The market seemed to have run out of bad news last week and apparently was looking for an excuse for a technical rebound. This excuse was found in several areas. The North Vietnamese Paris proposal on the exchange of prisoners should have come as no surprise but, coming as it did on the heels of the Pentagon disclosures, it may have been interpreted as giving the Administration a chance to gracefully extricate itself from Southeast Asia. Along the same line, the Administration's expressed confidence in the continuing economic recovery, and its ability to control inflation eventually by a continuation of the pre sent policies, and its refusal to consider wage and price guidelines at this time, contributed to the recovery. ' From a business point of view, several other pieces of good news were forthcoming this past week. Machine tool orders in May were reported 27.3 percent above April, and although still below last year's rate, the trend is encouraging. Factory orders rose 1.1 per ,..,..n Max for th!, bigg,est gain since Februar,,..ad,ye.rdathe .'–elll!tjlton Manage;;.n;.;t'lI' -Company'reported that its mutual fund grou-p registered net sales of 3.14 million last month, in contrast to net redemptions of 3.57 million in May. It is too early yet to forecast the summer rally, but we have been encouraged by the strengthening of the bond market and utility averages, and by the breadth of the market recovery thus far. This letter of September 18, 1970 spoke of the coming summer, its heat waves and the demands on those responsible for energy needed for power, air conditioning, etc. We are now in the midst of this period and it prompts us to check upon the current progress of these industries. The utilities are still struggling for fuel, reserve capacity, money for expanslOn, rate increases and investor fnends. We still believe the natural gas producers and distributors, especially those with strong reserve positions have a more favorable longterm outlook in this troubled group. We mentioned Cabot Corporation and JOY Manufacturing among those companies that might stand to benefit from these long-term dema,ds for energy. The former holds well in the market place with a favorable earnings trend and the continued promise for their plans to import liquified natural gas from Algeria. Joy Manufacturing reported earnings for the first quarter of 1971 at .89 per share versus .72 last year. The demand for fuels continues to favor the outlook of this producer of coal mining machmery. The market trend in coming weeks, and particularly the source of market leadership – -willbe carefuHy cconsiderea; -Hopefully ;-the a stute-'inve stor'WiU'b-e–a1'lricipa tfngstronger – – busmess conditlOns for the second half and into 1972. We continue to direct the reader's attention to high-grade companies with strong balance sheets. It is now eVident that the bull market shows signs of maturing, and we will be encouraged if high-grade stocks lead in this phase of the market. As this letter has stated in past weeks, the market should be more selective in coming months. DJII (11 00) 889.38 SPIC (1100) 99.59 Maturin 1. Delafield and Ashton Harvey For Anthony W. Tabell Delaheld, Harvey, Tabell No stotement or expreulon of opinion or any other matter herem contolned IS, or IS to be deemed 10 be, directly or indirectly, on offer or Ihe soil ClIo lion of on offer to buy Of sell ony security referred 10 or mentioned The motler 15 presented merely for the converlencos of the subscriber While Ne believe the sources of our .nformatlon to be relloble, we In no woy represent or guarantee the otturoty Thereof nor of the stotemenTs m(lde herein Any acllon to be token by the substrlber should be bosed on his own Irwesllgatlon and Information Janney Montgomery Scott, Int , 05 0 corparollon, ond It5 officers or employees, moy flOW hove, or moy loler loke, posllions or trade!. In respect 10 any secufilies menlloned In thiS or any future Issue, ond such position moy be different from any views now or hereafter expressed In thiS or any other Issue Janney Montgomery Scoll, Inc, which IS registered wllh the SEC as on Investment adVisor, may give adVice 10 lIs IfIvestment adVisory and other customers Independently of ony stolements mode In Ihls or In ony other Issue Further Information on any serurlly mentioned herein IS ovallable on request — ,–'-

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK eXCHANGE. INC. MEMBER AMER,ICAN STOCK EXCHANGE R. r. REYNOLDS INDUSTRIES (RJRl July 16, 1971 R. J. Reynolds derives about three-fourths of its annual revenues, 1. 8 billion, and more than 80 of 14-ltn''sprtax-earniiigs,''382nlhnon, ffOnitooacco' sale's. 'Despite unavoralil9'hea'1thpubncHy;-adv-ere– – 1.,- Price 61 3/4 regulatory decisions and heavy taxation, tobacco continues to be a very Est. Earns/Sh 1971 4.75 profitable business. RJR is the leading domestic cigarette manufacturer. Earns/Sh 1970 4.10 Winston and Salem are its leading brands. Cigarette earnings evidence Cash Flow 1970 275 Million stable, if undramatic, growth. Leverage results from a federal Range 1971 69 1/2 – 53 excise tax of 4.00 per thousand. RJR cigarette list price at manufacturers 1970 55 3/8 – 34 3/8 level is 10.25 to 10.75 per thousand cigarettes, 0.205 to 0.215 per Dividend 2.40 package. Selling, general and administrative expenses approximate 8 Yield 3.9 of selling price, labor, 7, tobacco leaf, 25, and the federal excise tax, Common Shs 40.3 Million 40. Pre-tax margins approximate 20. Accordingly, a very minor price Fully Diluted increase to its distributors can have a dramatic effect on RJR earnings. For example, a 3.5 increase, such as instituted in 1970, would boost the price of a cigarette package seven tenths of one cent. But, RJR tobacco earnings will increase about 18. It is noteworthy that in 1970, aided by the 3.5 price increase and 2.4 unit volume increase, cigarette pre-tax margins jumped from 18.7 to 21.1. R.J. Reynolds historically has raised Cigarette prices only to maintain its operating margins. Last year's increase was not needed for this purpose. However, three major Cigarette manufac- turers were experiencing sales declines and instituted 4.5 price increases. Common distributors prompt- ly raised the price on all brands to conform to this increase. Thus, RJR could either join the rise or forfeit profits to the distributor. Tobacco industry unit production is obtained from the Internal Revenue figures on removals. A removal occurs when a cigarette is moved from a bonded licensed warehouse area. Thi s ,j!!..pre paration,fQ!..s.h!pping.J.Q,jts.tributor..Atthat !loin,!,.th….QQI)l.ll-I1Y. bec.Q!!1e,liqble ,..fur.,fe.cl era) Cigarette ecise tax. Last year, as a result of strike hedge inventory building by other m' '0' these figures were distorted and RJR percentage of industry production fell to 31. 8 from 32.4 the prior year. Without this influence and reflecting the strong marketing success of Vantage, a low tar and nico- tine high flavor cigarette, RJR should regain its normal market share. Aiding RJR earnings in the current year are the continuing modest uptrend in unit volume, the benefit of last year's price increase for a full year, and an advertising saving that could approach 40 million. In view of continuing negative health publicity and the recent la,cklustre growth in cigarette unit sales, RJR is attempting to diversify. Containerized transportation, food products, and oil drilling are now all in- cluded in Reynold's operations. Food products include Hawaiian Punch, Chun King. McLean Industries, with ltS Sea Land division, is the company's most important acquisition. In 1970 McLean accounted for 374.9 revenues and a depressed 38.6 million pre-tax profits. During the past two years 317 million of equipment has been added to its fleet and an additional 500 million is scheduled by 1975. Margins were under pressure last year due to excess capacity On routes and ruinous price cutting. Price competition evolved in the North Atlantic when American Export dropped out of the rate setting conference. Subsequent prices fell so low that AEX found itself running full ships at a loss. Reinstitution of conference rates should restore stability. McLean, as the industry pioneer, is the most efficient operator. The most re- liable full service and most rapid turnaround times have enabled the Company to run a fleet of 48 older converted containerships against competitions' larger, faster and more efficient vessels. New ships under construction for McLean fleet are at least twice as fast and twice as large as those it now operates. Thus, one ship will take the place of four. Present fleet on charter can be used as feeder ships or charters may be abandoned. Proposed.acquisition of-U.S .Lines ,from-Kidde would .give,RJR-16 containerships,for-65—- million, considerably less than their net value. McLean ship financing is amortized from their cash flow. R. J. Reynolds financial position is enviable. Working capital totals 570 million. Long term debt of 400 million is supported by stockholder equity of 1.2 billion. Current assets include 560 million leaf tobacco inventory at LIFO. Market value for tobacco exceeds by a considerable margin book cost. Leaf inventory accounts for approximately 24 months' sales due to lengthy curing process that is necessary. Inventory decline during the past four years is primarily the result of trimming due to sluggish unit growth. Less tobacco per cigarette is also a factor. Required Penick and Ford disposition will result in 40 million pre-tax loss that will be charged against 1969 and 1970 retained earnings. Reynolds is in an established uptrend. Support eVident at 60-58 level. Point and figure intermediate objective 88. Dow-Jones Industrial (1200 p.m.) 892.52 Ronald Baron for S&P (1200 p.m.) 99.55 AnthonyW. Tabell AWT mn Delafield, Harvey, Tabell No statement or expression of OPinion or any other matter herein contolne! IS, or 15 to be deemed to be, directly or indirectly, on offer or the sOllcltolion of on offer to buy or se1l any security referred to Or mentioned The moiler IS presented merely for the conVef'lence of the subscriber While e believe the sources of our Informo tlon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mode herein Any achon to be loken by the subSCriber should be based on tlls own Invesllgollon and Information Janney Montgomery Scott, Inc, as a corporohon, and Its officers Qr employees, may now have, or may loter toke. pOSitions at trades In respect to any Secuntles mentioned In thiS or ony future Inue, ond such pOSition moy be different from any views nON or hereafter e.opreS\ed In thiS or any other InUIl Jonney Montgomery Scott, Inc, which IS registered With the SEC as on Investment adVisor, may g.ve advlce to lIs mvetment odvlory and other customen Independently of any stolements mode ,n It-us or m any other Issue Fvrlher ,formation on any security mentIOned herem IS available on request

——————————————————————————————————– I I TABELL'S I MARKET I I I I LETTER JI, 909 STATE ROAD, PRINCETON, NEW JERSEY 081540 DIVISION OF MEMBER NEW YORK STOCK EXCHANQE, INC MEMBER AMEFUCAN STOCK EXCHANGe July 23, 1971 fi Toe;ery thing' thereis-a-se-as-.;nan'd'&at'im;-toeve.r.y-purp-os..,e…u.n'd'e-r-'t'h'-'e.,hc-'eav-e.n.' znfme to – – be born, and a time to die; a time to plant, and a time to pluck up that which is planted. Ecclesiastes 3, 1-2 M3rket forecasters are not above quoting scripture to their own fell purposes and the above, due to its obvious application to the eternal stock-market dilemma, is probably the biblical citation most often us ed to illustrate the difficulties of equity investment. Gauging the proper time for the purposes of the stock market is always hard and as to whether the present is a time to pluck up that which is planted, we remain, we confess, somewhat uncertain. We suspect, however, that the market soil may be becoming awfully frosty for new planting purposes. Let us briefly recapitulate recent market history. The popular averages last made their highs at the end of April, some three months and 60 trading days ago. The recent low, made at the end of June, had brought the Dow down slightly more than 8 following a 50 rise since May, 1970. During the period obvious signs of potential distribution, in a number of stocks, at least, have begun to manifest themselves. The response to all this in certain quarters has been glacial calm — with references to the need for a healthy correction, incantations about a summer rally and repetition of the assurances of last Spring that a further move in the Dow to above 1,000 is a near certainty. As technicians, we are inclined to turn to market history for an assessment of what the recent downswing really means. The recent drop, as noted above, was slightly in excess of 8 on the I2oJ.DroRs.oL8or-greater-haveoccurred.in.precisely25.instances.since.J.942.1nconly-cfourof- these instances were the corrections involved within the context of an ongoing bull market. Ten of them were part of major bear markets, six were part of top formations leading to bear markets and five were part of trading range or base formation periods. From a time point of view, the figures are equally discouraging. There have been only three instances since 1942 where the market failed to move to a new high for as long a period as it has at present when the result has been other than a bear market or a consolidation period lasting for over a year. As we again approach the warm days of August, therefore, the stock market picture has changorl radically from that happy August of a year ago when the late bear market was finally laid to rest. At that pOint, with the Dow in the mid 700' s, bull market conditions obviously prevailed and, as we moved into the Fall, a newall-time high became an obvious possibility. The market has since moved some 200 points higher and, while tht new high still remains a possibility, we are that much closer to it, and it is only one possibility among many. It is not our intention here to present an overly negative picture. First of all, the amount of distribution that has taken place is nowhere as great as that which existed, say, in 1969. Moreover, the economic picture appears to us not only sound but, more importantly, sounder than is widely recognized. Second quarter earnings have, in a number of instances, been gratifying surprises to a great many forecasters, a-nd this is a trend we expect to continue as long as financial pages continue to prate about a healthy recovery falling short of expectations. Moreover, the ' – -mood'of the investing-public,-it'seems'to us,&whileobvfously optimisticsnow-s'rioneof the—–. …. classic signs of a speculative debauch to be paid for with an unusually unpleasant morning-after. For almost a year now, our own projections have been that the move, which began in May, 1970, would carry to new highs and, as stated above, we still regard this as a possibility. With the bulk of the move having already taken place, however, we are willing to exercise a certain amotnt of restraint. If a further extension of the upswing does take place, we expect its tone to be con- siderably less ebulient than that of the market which obtained through last Spring, and we are ready to admit of the possibility of a protracted trading range or of further minor weakness. Luckily, if a serious top is forming, we are probably still in the early stages. Enough techni- cal patterns remain strongly bullish that there is little difficulty, in our view, in finding attrac- tive investment media in the equity field. We are entering a penod, however, where it seems wise to be especially rigorous in selection of those stocks which merit inclusion in portfolios. Dow-Jones Industrial (1100 a.m.) 886.03 Anthony W. Tabell S&P (1100 a.m.) 98,93 Delafield, Harvey, Tabell 1'1WTmflNo statement or epress,on to buy or sell any secI,HIty tton to be reliable, we In of op.nlon or ony olner motter hereIn contolned IS, or referred no way 1r0eporer menetntoirongeudaraTnhteeemathtteeracIScuprraecsyenttheedremoferneolyr IS to be for the cdoenevmefe'dlentoc be. of dHCdly or Indlredly the subscrrber While on He offer or believe of Ihe statements mude herein Any action to be token the soliCitation of on offer the sources of our mformaby the subscriber should be bosed on hiS own investigation and information Janney Montgomery Scott, Inc, as 0 corporolton, ond Its officers or employees, may now have, or may later toke, POIIIOn5 or trades In respect to any securities mentioned In thiS or any future Issue, ond such pOSition moy be different from any views now or hereafter expressed In thiS or any other Issue Janney Montgomery Scol', Inc, which IS registered wllh Ihe SEC as on ,nvestment adVisor, may give adVICe to IlS Investment adVISOry and othel customers mdependently of any statements mode m thiS or In any other Issue Further Information on any security mentioned herein IS available on request

TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER New YORK STOCI( EXCHANGE, INC. MEMBER AMERICAN STOCK EXCHANGE July 30, 1971 ReadersofthtslettermayhavenoticedagrowingSkepticism'asto'the'aGtionofequity,'''''.–I markets creeping into the comments made over the past few months. It could well be argued, in fact, especially in view of last week's market action, that this skepticism should have been voiced a good deal more vociferously. The criticism is well taken here, and a few notes will be offered by way of explanation if not excuse. One of the characteristics of the stock market in recent years is that distributional patterns have tended to build with much greater rapidity than had earlier been the case. This was true prior to the first phase of the late bear market in early 1969 and was even more viciously true prior to the second phase in late 1969 and early 1970. The pattern of a rapid distributional buitl- up has again continued in recent months. As recently as last April or May there was, in our view, absolutely no reason, from a technical point of view, for the maintenance of anything other than an aggressively invested equity position. In a short period of three months, that picture has changed rapidly. Last week's trading saw popular stock-market averages plunge to new lows in a decline re- miniscent of those days we would all prefer to forget prior to May, 1970. The fundamental questions, of course, center around how far and for how long this weakness can be expected to continue. As we suggested last week, history fails to afford us a great deal of grounds for optimism. The percentage decline in the Dow, so far, is 9.4 over a period of 65 trading days. Any available reading of the record of declines of Similar magnitude in the past strongly suggests – -tWO-fa-ctsl)th-at'tliepres-entErakness-i'sl1KelYtb-cott'tinue for some time and;2)-tfiatt1iere i';s..,;…..-t-' at least, a possibility of a significantly lower ultimate low. It is time, quite frankly, that worries us more at the moment than the potential for a further drastic fall from these levels. Any reading of individual stock patterns must convince the observer that many stocks are already reaching downside objectives, and numerous others are close enough to those objectives so that further market weakness would bring them to what would have to be considered an attractive buying area. What we are not convinced of, as yet, at least, is the likelihood of an imminent reversal which would make aggressive equity commitments the attractive proposition that they were in late 1970 and early 1971. This is not to say that we could not be so convinced by technical evidence which might be given by the market's action from here on out. We feel, however, that, if such eVidence is fur- nished, it will become apparent at market levels not too far removed from today's prices. We are, therefore, inclined to await such improvement before becoming wildly optimistic. The above analysis may be criticized, of course, on the ground that it takes no account of the so-called fundamental picture. This view will find little sympathy in this quarter. The so- called fundamentals, quite frankly, are little changed from last April when the Dow was making new highs. It is, in fact, quite plausibly arguable that they have improved. It is, unfortunately, not fundamental factors which cause short-term price movement but supply-demand patterns as reflected by the technical picture. Everything that has taken place in the equity markets both on the rise to last April and the subsequent decline is apparently.consistent with.the'suggestions we have been-making.since– last January about the apparently developing long-term pattern. We have indicated our strong belief that the era in which bull and bear markets are played out against the background of a strong secular uptrend came to an end in 1966. It is quite evident now that Something up there doesn't like us, Up There being the area around 950-1,000 on the Dow. The present marks the fifth instance in the past eight years that a move to that area has been followed by a decline of some magnitude. We do not regard this as a statistical accident. It simply confirms our belief that the secular trend of the market is a great deal flatter than the sharp advance which characterized the 1950' sand 1960' s. We do not believe, in other words, that money can continue to be invested with the naive buy-and-hold-growth-stocks approach was born in the 1960' s and which still dominates investment thinking. Rapid reversals, such as that of the past few months, will, we are afraid, continue to be a fact of investment life. The proper course is not to deplore this trend but to learn to live with it. Dow-Jones Industrial (Noon) 863.03 ANTHONY W. TABELL S&P (Noon) 96.09 DELAFIELD, HARVEY, TABELL Avv J.blemen' or expreslon of opinion or any oiher matter herein contolned IS, or 1 to be deemed 10 be, directly or ,ndlrectly, on offer or the soircltatlon of an offer to buy or sell any security referred to Or mentioned The motter 1 presented merely for the convenience of the subSCriber While we believe the ource of our Informahon to be reliable, we In no woy represent or guoranlee the occurocy thereof nor of the stalements mude herein Any ocllon to be token by the subSCriber should be bosed on hiS own InVestlgotlon and Informalron Janney Montgomery Scali, Inc, as a corporotlon, and Its officers or employees, may now have, or may later toke, positions or trades In respect to any securities mentioned In thiS or any future ISsue, and such poslhon may be ddferent Iram any views now or hereafter epressed In thiS or any other lSue Janney Montgomery Scott, Inc, which IS registered With the SEC as on InveStment odvlsor, moy give adVice 10 Its Investment adv,Ory and other customers Independently of any stotements made In thiS or In any other Issue Further information on any security mentioned herein IS ovailable on request

TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON, NEW JERSEY 08540 DIVISION OF MEM8EFI NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE August 6, 1971 – Egui! mrkej)!\lEgLa9iJnearlyadil!.teekwith th 120w.reaching '!.Il. i!l!rad;cay-'I low of 840.10 on Wednesday. Early weakness was stemmed by a mild rally on Thursday -and early Friday. As stock prices plunged to new lows, financial page headlines continued to feature news of the weakness of the dollar in international currency markets. Financial commentators, unfortunately, have an irresistible urge to find reasons for all market movements. It now appears assured that, for better or worse, the current decline will wind up in the history books as being caused by the 1971 dollar crisis. Thus there will come into being yet another firmly-rooted myth to go along with the ones about the 1962 break having been caused by unkind words from the President about U. S. Steel and the subsequent bottom having something to do with the Cuban Missile Crisis. Rational discussion of what is going on in world money markets is difficult — due partially to the fact that these markets constitute a complex phenomenon that few understand coupled with the fact that the views of a great many experts tend to fall into the category of religious belief rather than reasoned opinion. Furthermore, as we attempted to suggest above, we don't think that an exhaustive probe into the world monetary situation is particularly central to the investor's dilemma at this point. We suspect the present weakness is yet another instance of the age-old tendency for the market to do what it is technically ready to do in the first place and to find a plausible excuse as it goes along. We have commented in the last few issues of this letter on the extremely rapid deterioration that had been taking place in the market's ,J.—re—-'i1hntcalcondition'and 'it istothat 'teChniCalcondition;we'thtnx;-wemustluokfor 'clues a s'I to the proper investment stance. We can summarize our own view by saying that 1) we would tend to be skeptical of any rally that took place from current levels, but that 2) we would be willing to make selective purchases into any further substantial weakness. This reasoning can be clarified by a look at the present technical picture. In terms of the Dow (patterns on the other averages are roughly similar) there are two plausible downside objectives, one, relatively conservative, at 840-835, and another, representing the most pessimistic possible reading at the moment,of 760-750. The first objective, of course, had just about been reached at this week's low, and it might, therefore, be a plausible assump- tion that the intermediate-term decline has or is about to bottom around current levels and, that after the requisite period of basing, the market is gOing to move higher. There remains that risk, though, of the pessimistic objective being the correct one and, from the 850 level on the Dow, that risk is substantial. We would, therefore, be willing to watch any current rally from the sidelines and assume the risk of having to rebuy at higher levels were the market subsequently to demonstrate improved internal strength. By contrast, further weakness would produce a number of effects. We would be that much closer to the most pessimistic downside objective and that much further below the level the market could be expected to regain on an upside pullback, thus improving the risk/reward ratio. — Moreover, and this, is probably.the most important factor in our thinking ,.a further decline … would produce an oversold condition, characteristic in the past of major stock market bottoms. Rallies from this sort of oversold condition have proved highly dynamic in the past,and we would be inclined to participate if the same sort of deeply oversold condition were now to occur. It must be stressed, however, that, as of week's end, such a condition had not mani- fested itself,and that such a manifestation would still require somewhat lower prices. Whatever the eventual outcome, the current decline itself signals, quite obviously, that the character of the market has changed dramatically from that which existed between August, 1970 and this Spring when the only plausible assumption as to market action was that of a con- tinuing uptrend. Certainly such an interpretation is not possible at the moment and, in light of this, continued mild skepticism appears advisable until eVidence of improving technical action asserts itself. DOW-Jones Industrial (Noon) 850.54 SSP (Noon) 94.27 ANTHONY W. TABELL DELAFIELD, HARVEY. TABELL AW;C;mQrnent or express!on of opinion or any other matter here'n contolned IS, or IS to be deemed 10 be, directly or ,ndlrectly, on offer or the SOl,Cllollon of on offer to buy or sell cny security referred 10 or mentioned The molter IS presented merely for Ike convellence of the subscriber While we believe the sources of our Informotlon to be reiroble, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any action to be token by the subSCriber should be based on hiS own Investigation and Informallon Jonney Montgomery Seal!, Inc, as a corporation, and Its officers or employees, may now have, or may later toke, poslllonS Of trades In respect 10 any securities mentioned In thiS or any future Issue, and such POSition may be ddferent hom any views now or hereafter expressed In thiS or any other Issue Janney Montgomery Scott, Inc, which IS registered WITh The SEC as on InvestmenT adVisor, may give adVice to Its investment adVisory end other customers Independently of any statements mode In thiS or In any other Issue Further Informohon on any securoty mentioned herein IS aVailable on requet

—————————————————————————————————————- TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORk STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE August 13, 1971 Anyone who looks only at the popular stock market averages has a fairly well-defined idea as to just what the stock market has done over the past year. From May, 1970 through April, 1971, the Dow scored 'I – ,anac'lvcmce of,jusLover50candhas,. in the.past three .monthsretracedoj!lsLbouJ the ,clasir ,i. of that advance. A closer look leads to two conclusions, (I) that the recent advance was, in actuality, more dynamic than that shown by the averages and, (2) that the subsequent decline has been, to date, a highly diverse affair. The following table shows the action of 99 S &P Industrial group averages In terms of their percentage advance from their 1970 low to their 1970-1971 high and the percentage of that advance retraced at recent levels. As the table shows, 69 of 99 groups have chalked up better advances than the averages. In terms of subsequent retracement, some groups have retraced their entire advance and are selling at new lows while others, so far, have hardly been affected by the one-third retracement in the averages. It Is an old Wall Street saw that the stocks to buy on a market tum are those which have gone down the most and those which have gone down the least and, like all such adages, it has an element of truth. Those naturally inclined toward bargain hunting can find numerous candidates in the table. On the other hand, those groups which have shown above-average strength in both the rising and falling cycles could, if that strength continues throughout the decline, be outstanding performers on the next market advance. !etrace- !etrace- Retrace- Adv. ment Adv. ment Adv. ment Aerospace 82 49 Meat Packing 65 6 Restaurants 144 12 Air Freight 126 49 Fackaged Foods 31 31 !etail Strs-Comp 72 19 Air Trans port 147 52 Forest Products 32 72 Department 82 19 Aluminum 32 Atomic Energy 95 93 Gold Mining 76 8 12 Home Furnishings 100 20 Discount Strs Food 133 5 39 4; Auto Parts 68 Alto Truck9-f6rts 79 Brewers 47 Distillers 28 Soft Drinks 55 Bldg Comp 50 Air Cond 39 Cement 63 Heating-Plumb 25 Roof-Wallbrd 63 Cbnt-ilk1al-Glas s 35 Cont-Paper 64 Copper 23 v m, 13 Lead-Zinc 18 91 28 Leisure Time 137 13 20 Machine Tools 55 53 41 J\;jricultural M3.ch 53 55 10 M3.chirery-Comp 24 15 27 Cbnst-Mat'l 71 30 19 Industrial 60 25 44 M1Serv 01 Well 109 11 149 Specialty 58 26 23 9eam Gen EqJip 119 26 72 M9talFabricating 78 41 40 M9tals Misc. 24 123 101 Mobile Homes 203 9 mau v.uc. Variety Shoes Soaps Steel Suga!'-Comp Beet Refiners Cane Refiners Sulphur Thxt-.'\pparel Mfrs Thxt-&ynth Fibers Text Products Tire-Rubber 1bbacco-Cig Mfrs 114 79 49 16 63 54 90 75 68 56 38 45 75 13 21 0 112 40 50 31 62 43 27 81 22 21 Cosmetics 63 Drugs 42 Eectrical Equip 61 Elatron M3j Cbs 78 Elec Hmse App 73 Electronics 89 Finance Cos 49 fuBll Loan ecs– 84 30 Motion Pictures 95 51 Toys 88 22 Office Equip 57 47 Truckers 128 21 Offshore Drilling 173 15 Vending Mach 87 33 Oil-Comp 54 27 Electric Cos 24 8 Crude Producers 125 6 N'lt'l Gas-Dist 30 48 DomIntegrated 5220 N'lt'l Gas-Pipe Ln 43 40 Int'l Integrated 49 29 Telephone 32 -33-Paper–' -'2!i-71–BankS-NYC – – – 38 63 0 8 46 32 38 69 – 60 Food-Composlte 35 Biscuit Bakers 42 Bread-Cake 120 Canned Foods 36 Com Refiners 35 Dairy Products 47 17 Pollution Control 92 21 27 Publishing 94 37 56 Fadio-1V-I3rdastelS 103 14 I Fadio-'lV-Mfrers 133 30 54 Railroad Equip 49 27 19 Real Estate Chemicals 79 42 52 63 Bituminous Coal 117 35 B.s-Outside NYC Sav-Loan bId Cbs Ins – Life Ins-Multi Line Ins-Prop-Liab Investment Cos Confectionery Conglomerates 44 88 50 50 90 24 60 95 32 39 21 12 6 54 21 41 The stock market made Its most convincing attempt so far to reverse the Intermediate downtrend with the Dow rallying from midweek to reach the 860 area early Friday. The deep oversold condition reached on Wednesday, the steepness of the rally, and the fact that one downside objective had been reached at the week's lows make an Intermediate term bottom at least plausible. In any case, however, a period of base building will be required, and we would prefer to observe this period before stating with certainty that the decline from the April highs had been permanently stemmed. Dow-Jones Industrial (1100 a. m.) 859.67 ANTHONY W. TABELL SeeP (lliQQ a;FR.) 96.99 ;QJ5LnJ'IEJ.Q, IIl\Wl'f, TABEbb AWeoT11ftement or expression of opInion or any oTher matter herein contained 1, or IS to be deemed to be, directly or indirectly, on offer or the sollcllol10n of on offer to' Ettiy or sell any secvrlty referred 10 or mentioned The moiler IS presented merely for the convenience of Ihe subscnber While we believe the sources of our Informa- tion to be rehable, we In no way represent or guarantee thc accuracy hereof nor of the statements mude herem Any aelion to be taken by the subSCriber should be hosed on hiS own investigation and mformatlon Janney Montgomery Scott, Inc, as a corporation, and Its offICers or employees, may now have, or may later fake, POSitiOns or trodes In respeel to ony secuntles mentioned In thIS or ony future Issue, ond such position may be different from any views now or hereafter expressed In Ihls or any olher Issue Janney Montgomery Scott, Inc, which 1 registered With the SEC as on Investment adVisor, may ,live adVice to lis Investment adviSOry and other customers Independently of ony statements mode In thiS or In any other luue Further mformatlon on any secuflfy mentioned herein IS avo liable on request