Viewing Month: March 1975

Tabell’s Market Letter – March 07, 1975

Tabell’s Market Letter – March 07, 1975

Tabell's Market Letter - March 07, 1975
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE – March 7, 1975 Market action continues satisfactory and, as we mentioned In this space a mSlnth ago, the likelihood of any-substantlaFcorrectlon'at this early stage of–the advance appears'relatlvelycremote.- There has7 how- ever, been some recent evidence of rotation of Individual stock leadership, and we are, therefore, com- mencing, this week, our occasional practice of a series of letters commenting on Individual industry groups and stocks In those groups. It should be noted that, as is always the case in these letters, comments are based solely on the technical action of Individual Issues and that further fundamental Information on any issue discussed is available on request. AEROSPACE. From a relatlve-strength point of view, this group had acted well through the third quarter of last year, generally moving down less than the market. Since that time, however, most stocks have failed to participate In the advance, and relative action has deteriorated. Potential base patterns remain im- pressive and upside breakouts, 22 In the cast of Boeing (20) and 31 In the case of General Dynamics (29) would Indicate higher levels. Outstanding action In the group Is being shown by United Aircraft (37) which has an upside target of 46 followed by possible higher levels. , AIRLINES. Another example of very sharp relative action reversal where one of the worst-acting groups in the late bear market has turned sharply upward, and was actually responsible for leading the Dow-Jones Transportation Average to a recent new high. Care should be exercised in new commitments, however, as in most cases heavy overhead supply now exists fairly close to current levels. Probably the most outstand- ing pattern is UAL Inc. (23). ALUMINUM. This group is typical of the cyclical issues which had resisted all but the last phase of the late bear market but which then broke downward and, by and large, failed to partiCipate in the recovery. However, by now, downside objectives have been reached, and the group has made substantial progress toward building new bases. We would hold current commitments although the existence of heavy overhead supply from the 1974 tops, In the case of Aluminum Company of America (39) at 42-48, for example, suggests — —that more-b,ising'maybe,r,iquired- – — – — – – — – -, – -. – — – -.- AUTOMOBILES. Long-term relative strength has, unsurprisingly, been poor during the worst automobile year in a long time. Nonetheless, the market appears to have discounted the current dismal fundamentals. Both Ford (36) and General Motors (41),have reached downside objectives and penetrated their long-term downtrend lines. However, technical patterns suggest that further baSing, around the mid-30's for Ford and around the low 40's for General Motors,is probably a necessity before ;lny meaningful upside move can be considered. AUTOMOBILE PARTS. Relative action has remained just about in line with the market for almost three years now. Such issues as Champion (ll), Dana Corp. (21) and Maremont (11) show evidence of having begun a basing process, but it is doubtful if that process is complete. The most Impressive technical pattern is that of Eaton Corp. (27) where ability to reach 32 would indicate considerably higher levels. BUILDING MATERIALS. Here Is a classic case of a market being willing to look ahead as relative strength of these Issues has been Improving since last fall despite the generally abysmal building picture. Those companies Identified with home improvement have the most outstanding technical patterns. Johns Manville (22), although it might decline short-term to Slightly under 20, would be an interesting purchase candidate on such weakness. Action of air conditioning companies has generally been desultory in recent markets. CHEMICALS. Here a wide diversity of indiVidual stock patterns presents itself. Union Carbide (54), despite its recent move to a seven-year high, suggests a longer term upside objective of 96. Industrial gas companies such as Air Products (60) and Chemetron (29) generally show impressive patterns. Dupont reacted well to Its recent dividend cut and seems to be forming a base although more work is probably needed. Allied Chemical (36) and Monsanto (54) on the other hand, while they may well move higher short-term, may encounter problems with overhead supply,at 40-50 fr the forer ad at 60-8 for the latter. CONTAINERS-METAL AND GLASS. American Can (34) and Contlrental Can (28), despite recent sharp moves, both have technical patterns that suggest higher levels. In the glass-container group Brockway Glass (16) has recently broken out of a two-year base with an upside objective of 24. COPPER. Recent relative strength in this group has been somewhat below average. Phelps Dodge (34) has shown interesting basing action recently and could well mount an attack on heavy overhead supply in the low 40's. Kennecott (36) is likely to continue to base in the low to mic!dle 30's but the present potentlalls substantial if an upside breakout can be achieved. Anaconda (17) is probably in the early'stages of a base formation in the 14-18 area. Dow-Jones Industrials (1200 p.m.) 764.78 S & P Compo (1200 p.m.) 83.97 Cumulative Index (3/6/75) 465.46 AWT/jb ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or expression of opinion or any other mottcr herein Contolned IS, or IS 10 be deemed to be, directly or mdlreclly, on offer or the 501,cltollon of on offer to buy Of sell any security referred o or menhoned The molter 15 presented merely for the converlenc of the subscber While 'i'Je believe the sources of our Informo han to be reliable, we 11\ no way epresenl or guarantee the accuracy thereof nor of the statements mude herein Any action to be token by the 5ubs.cnber should be based on his own Investigation and Information Janney Montgomery Scoll, Inc, as a corporaTion, and Its officers or employees, may now have, or may loter toke, POSitions or trades In respect to any seCUrities mentioned on thiS or any future Issue, and such posilion may be different from any Views now or hereafter epressed In thiS or any other luue Janney Montgomery Scott, Inc, which IS registered with the SEC as on Investment adVisor, may give adVice to Its investment adVisory ond olhel customers Independently of any statements mode In tha or In any other Issue Further Information on any seevflty mentioned herein IS available on request o

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Tabell’s Market Letter – March 14, 1975

Tabell’s Market Letter – March 14, 1975

Tabell's Market Letter - March 14, 1975
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— – – – – – – – – – – – , TABELL'S MARKET LETTER I I – ——- -,I – 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORl( STOCK eXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE March 14, 1975 ' -. We- are Continuing this-week-cour- revlew-ofindividualindustry groups andstocks. .,AIL com'1'ptsoar-, based solely on technical action of the graups and stacks involved, and further infarmation on any issue mentioned is available upon request. DISTILLERS. Group performance generally has been in line with the market since the early part of 1974. In most cases, the bases formed at the 1973-74 laws were small and, as the stocks have moved up along with the market, objectives are beginning to be reached. Generally, better opportunities would appear to exist elsewhere. DRUGS. Relative strength of this graup has begun to. lmprove, and in general mast issues possess good short-term technical patterns. Johnson & Johnson (93) has an upside abjective af 106, Merck (75) an up- side target of 88, Schering Plough (64) an objective of 78 and Pfizer (35) of 51. Cautian shauld be exer- cised, however, since around the levels of these objectives most issues will be running into. massive over- head supply from their 1973-74 tops. We would, therefore, be extremely watchful for any evidence of pattern deterioration and would be willing to. use the issues as sources of funs shauld antiCipated strength occur. ELECTRICAL EQUIPMENT. Relative action of the group as a whole has tended to. be below average. General Electric (46) has a gaod short-term pattern with a possible objective In the low 60's but runs into heavy overhead supply in that area. Westinghause (15) has rebounded from a low of 9, and its short-term objective has been reached. Probably more work will be needed for a great deal more can be expected an the upside. Cutler-Hammer (24) and I-T-E Imperial (18) have formed fairly impressive bases and cauld successfully penetrate the overhead supply just above current levels. The former has a short-term objec- tive af 36, fallowed by possible higher levels, and the latter an intermediate-term target of 29. ELECTRONICS——-Therehasbe,en.a oshaIR .i1l!Rr-2yen-leotln sll.ort-tE!rl11tive .strength since abaut the first of the year in this group after it had acted poorly relative-to the market since the fa-ll of 1973-;l-esulfing in precipitous price declines, especially in the more marginal issues. In the semi-conductor field, Texas Instruments (90) has been acting well on a short-term basis but heavy overhead supply exists in the 100- ll5 area and we would regard it as a sale on strength to those levels. Most issues in the group appear to possess limited potential in contrast with ather oppartunities available. FINANCE. Graup relative action, which had been above average for most of last year, has deteriorated somewhat in recent months, suggesting that in most cases more base-building will be required. At the moment, one of the most canstructive patterns appears to be Beneficial Finance (18) with an upside objec- tive of 32. FOODS. Despite the general law volatility of this group, relative action has remained abave average even In the recent market rise. Patterns in the group are diverse. Borden (24) has a pas sible upside ob- jective of 34 and Standard Brands (62) one of 96. General Foods (25) has moved up sharply but is now running into fairly heavy overhead supply. Soybean pracessors such as Archer-Daniels-Midland (20) generally possess impressive patterns, this issue recently having broken out of a base suggesting ap- preciably higher levels. Corn syrup producers, the benefiCiaries af the recent sugar shortage, have moved ahead sharply, but higher objectives are readable, including a possible long-term target of 78 for CPC International (40). Sugar stacks, In general, have been subject to recent weakness but in some cases, at least, may be rebuilding bases for a further upside leg. FOREST PRODUCTS. Boise Cascade (17) and Weyerhauser (33) show improving technical patterns with the former having an upside objective of 28 followed by higher levels and the latter a lang-term target in the low 60's. Geargia Pacific (40), by contrast, meets some overhead supply around current levels. GOLD. Depite recent impravement;- majot issuesare rurining into heavysupply at around current – levels. The possible downside implications of major tops formed last year were not fulftlled, and we would regard the group as being potentially vulnerable. HOSPITAL SUPPLIES. Recent technical action has been impressive and higher levels are probably indicated short-term. As with the drug group, however, overhead supply not tao far abave current levels represents a potentially inhibiting farce in the way of a further advance. HOTEL-MOTEL Recent relative strength improvement in this group has been among the sharpest of any major industry, representing a sharp rebound from the extreme oversold condition that existed at the end of 1974. In general, we wauld use recent strength to. shift these issues into other areas. Dow-Jones Industrials (1200 p.m.) S & P Camp. (1200 p.m.) Cumulative Index (3/13/75) 476.02 AWT/jb 768.70 84.24 ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL No slclemenl or expression of opinion or any other motter herein contamed 1, Of IS to be deemed to be, directly or Indirectly, an offer or the SollCllatlon of on offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convelImc of Ihe subscriber While we believe the sources of our tnforma- tlon 10 be rellable, we tn no way represent or guorantee Ihe accuracy thereof nor of the statements mode herein Any aCTIOn 10 be token by the subscriber should be based on hiS own Investigation and tnformatlon Janney Montgomery Scali, Inc, as a corporation, and Its officers or employees, mCJy now have, or may later toke, poSitions or trades tn respect to any sCVrllles mentioned tn Ihls or any future Issue, and such POSition may be different from any views now or hereafter expressed tn 'hIS or any other ISlue Janney Montgomery Scott, Inc, which II registered With 'he SEC as on Iflvestment adVisor, may give adVice to Its Investment adVISOry and other rustomers Independently ot any statements mode In IhlS or In any other Inue Further Information on any seC\.JfIty menlloned herein IS available on request

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Tabell’s Market Letter – March 21, 1975

Tabell’s Market Letter – March 21, 1975

Tabell's Market Letter - March 21, 1975
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TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW VOAK STOCK EXCHANGE, INC MEMBER A,MERICAN STOCK EXCHANGE – March 21, 1975 -…. ThemaJtet this wS'ei s p,uttered Jls.j.t PJlwacted.tj1e. 890'-tl–Rpya!-ea oftheDo'&,J()neJ-tls;- '' trial Average. The average from the December 6,1974 low of 577.60 has increased 36-.17 in the' short span of 66 trading days. Two alternatives appear likely. The extent of this move would in- dicate the first leg of the bull market is indeed in a mature stage and a correction warranted. However, the duration of this move indicates the possibility of a further advance from these levels allowing for technical consolidations. In the postwar experience, the length of the move of the first phase of the bull market this old before a 5 correction occurs can be as many as 326 days (9/14/53 – 1/3/55) to as few as 145 days (10/7/66 – 5/8/67). Neither of these alternatives changes our constructive view of the market. We are continuing th,S week our review of individual industry groups and stocks. All com- ments are based solely on technical action of the groups and stocks involved, and further informa- tion on any issue mentioned is available upon request. INSURANCE. Both fire-and-casualty and life companies have recently been showing above average action, although there has been some very short-term deterioration. We would regard Aetna (23), Lincoln National (29) and Travelers (26) all as being attractive commitments for high- grade investment accounts on weakness toward support levels. MACHINERY-FARM EQUIPMENT. Deere (41) and International Harvester (25) have both put in constructive percentage advances since their 1974 lows. However, long-term group relative strength is neutral and stocks appear to be trading in overhead supply. MACHINERY. Group action in these related stocks continue to be mixed. Ingersoll-Rand (74) is broadening potentially constructive patterns in low 70, high 60 area and would look for con…….. -firmationof-BQ longtermbreakout. Black and-Becker (3-1.) -recently-broke-out- of' substantial-ba se – – formation at 30 indicating upside potential of 50. Would use strong support area of 28-26 to technically justify purchase. Majority of stocks such as Caterpillar (65), Chicago Pneumatic Tool (26), Cincinnati Milacron (19) and Clark Equipment (31), to name a few, need considerable time to improve existing technical patterns and would aVOld. MACHINERY-OIL WELL EQUIPMENT. Reviewing this group exactly one year ago, the obvious outstanding performance was then noted and it was suggested that these stocks should be sold on strength. Since that time, Dresser (49), Halliburton (138), McDermott (73) and Schlumberger (103) have technically corrected their spectacular advances and are all selling below their respective prices of one year ago. However, it must now be noted that Improved technical strength is present and would consider Dresser's ability to reach 51, and Halliburton to reach 144 as justification for purchase. McDermott and Schlumberger have already broken out of comparable base patterns in- dicating higher levels. Because of institutional interest in this group, we feel these improvements are significant. MOVIE-TV. Most interesting purchase candidate at current levels could be CBS. INC. (42). Stock has recently broken out of a long-term consolidation area at 42 and indicates upside ob- jective toward the mid-70 level. Disney (43) and MCA (43) have both put in spectacular perform- ances but in the case of Disney, stock is encountering heavy overhead supply in the 42-48 area and MCA is approaching its upside objective m the 50-55 area. Small broadcastmg companies in this related group have had constructive percentage moves from their 1974 lows. However, feel stocks should be sold on strength where heavy overhead supply is present. – — — '.,…. -…;…. — ….– .-… —,;-.- – -;;… -. –;0 – – '—- — – ;.r OFFICE EQUIPMENT. Recent improvement in group relative strength should be examined closely. Burroughs (91) recently broke out of base formation indicating upsIde objectives of 120-158. Digital Equipment (87),having finally counted itself out on the downside,met support in the fall of 1974 in the 50-60 area. Smce then It has consolidated,breaking out of a base formation which mdicated an upside objective of 90. This has been realized. IBM (210) contmues to trade in a short-term neutral trend, breaking out of this trend at 226 on the upside and 206 on the down- side. The stock's long-term upside objective indicates 280. We would continue to hold. Sperry Rand (35) continues to look attractive and feel purchases can be justified on minor weak- ness. Current upside objective indicates 46-51. Xerox (74) has reached short-term upside ob- jective of 80 and time will be needed before pattern will improve. Heavy overhead supply is present. Dow-Jones Industrials (1200 p.m.) 759.39 ANTHONYW. TABELL S & P Compo (1200 p.m.) 83.11 DELAFIELD, HARVEY, TABELL Cumulative Index (3/20/75) 480.53 RJSJr/jb No statement or expression of opinion or any other motter herein contained IS, or IS 10 be deemed to be, directly or indirectly, on offer or the sollcltotlon of on offer 10 buy or sell any security referred 10 or mentioned The matter IS presented merely for The converlenCE of the subscriber While we believe the sources of our mforma lion 10 be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herem Any action to be taken by the subscriber shOuld be based on hiS own Invesllgahon and Infarmallon Janney Montgomery Scott, Inc, as a corporation, and Its officers or employees, may now have, or may later lake, poslltons or trades In respect ta any SeCUrities mentioned In thiS or any future Issue, cnd such position may be different from any views now or hereafter eypressed In thIS or any other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC os on investment adVisor, may give adVice to Its Investment adVisory ond othel customers Independently of any statements made In Ihls or In any other Issue Further information on any security mentioned herein IS available on request

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Tabell’s Market Letter – March 27, 1975

Tabell’s Market Letter – March 27, 1975

Tabell's Market Letter - March 27, 1975
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,.- .. ….-r- . , I ITABELL'S I I MARKET I ) LETTER I –oil 909 STATE ROAD, PRINCETON. NEW .JERSEY 08540 DIVISION OF MEM8ER NEW YORK STOCK EXCHA.NGE, INC. MEMBER AMERICAN STOCK EXCHANGE March 27, 1975 ……..—/Last w8ek we presented twoalter-nativ,-esAacing thestock..markeLas-ltapproached….the80-Osu-pply-,,-ar-ea ,,- in the Dow-Jones Industrial Average. Earlier th1S week, aided by the dramatic news events from the Middle East, the market resolved these alternatives. In flve trading days the lliw-Jones Industrial Average cor- rected 1tself from 776.12 to 743.43 or 5.48. The short-term tops formed on our two-point unit and five- point umt charts mdicated a downs1de potential of 728-720; and on an intraday basis these objectives were approached. Subsequently the market reestablished its uptrend. The short time span (68 trading days) of the init1al phase of the bull market ( 36.17) coupled with the volatility of the general market provides us w1th a rationale for the continued sustamability of this move. We complete this week our review of the technical pos1tlOn of the major industry groups. Comments on individual stocks are based solely on technical factors and further information 1S available on request. OILS. The domestlC oils as a group have moved sideways smce advancing from their 1974 lows with no apparent improvement In relatIve strength indicated. The internationals also continue to show poor relative strength action and we would avoid purchases for capital appreciation at current levels. PAPERS. Although group actlOn of the paper stocks has been neutral, lOdividual issues have made sub- stantial percentage gains. These stocks would mclude Crown Zellerbach (32), International Paper (41) and Union Camp (53). The moves appear to be part of a long-term consolldation phase and time w1ll be needed to work through heavy overhead supply. An interesting buy candidate is Weyerhauser (33). Ab1lity to reach 36 would indicate long-term ups1de objective of 62. Support is present under current levels. RAILROADS. In spite of disappointlOg relat1ve strength action of this group, we continue to feel Burlmgton Northern (36), Norfolk & Western (64), which have minor short-term tops, can be purchased on weakness as downside objectives are reached. Also, Seaboard Coasthne (29) continues to trade in strong support area lOdicating higher levels for the longer term . .- – RML-ROAB-EQUWMEN'l'. .One of4hemost-attracHvepatterns1OHtlS-group-is cAmtedIndustne-5e),- -.-.-1–11 whlch recently broke out of base formation mdicating an upside object1ve of 76. Strong support is present in m1d-40 area. Pullman (45) continues to trade in long-term neutral pattern. The ab1lity to reach 51 would break out of 1tS trading area with an upside potential 10 the mid-70's. RETAILING. The long-term relat1ve strength of the retailing department stores remams positive and we would cons1der purchases on weakness. Federated Department Stores (40), Kresge (25), May Department Stores (33) and J. C. Penney (56) are all in the process of broadening potentially constructive base forma- tions; however, time will be needed to develop these patterns in order to penetrate heavy overhead supply. Strongest area 10 retailing group continues to be the fooo stores and we recommend purchase of American Stores (35) which mdicates an upside objective of 46-64 and Safeway Stores (44) wh1ch has an upside objec- tive of 60. Strong support is present under current levels. RUBBERS. Although stocks in this group appear to have reached downSide object1ves, substant1al llme will be needed to improve technical patterns. The exception in this group is Bandag (33). The ability of this constructive pattern to reach 37 would mdicate long-term ups1de objective of 70. SAVINGS AND LOAN. Recent short-term relative strength of these stocks has been impress1ve, most stocks appreciating 100 from their 1974 lows. However, from these levels stocks appear to be encounter- ing heavy overhead supply and we feel time w1ll be needed for further advances. SOAPS. W1th strong support under current levels, Colgate-Palmolive's (29) ab111ty to reach 31 would break stock out of major long-term base indicatmg higher levels. Purchase is Justified. Proctor & Gamble's (94) techmcal pattern 1S neutral. Ab1lity to reach long-term ups1de breakout of 108 mdlCates mitial upside objective of 150. SOFT DRINKS. Coca-Cola (79) has broken out of a long-term base formatlOn wh1ch mdicates a poten- tia1120. Pepsico (60) also-has'broken'out'of'a'base formation which-indlcates ups1de objeCt1ve oe75.- We' would continue to hold both securities but look for short-term relat1ve strength deteriOratlOn. STEEL. Long-terrn pattern of major steel companIes continues to be most constructive. Bethlehem Steel (34), Republic Steel (32) and U.S. Steel (57) have broken out of maJor base formations lndlCatlOg higher levels and we feel purcha se j ustifled. Also ,Armco (30), Inland (40), Wheeling Pittsburgh (25) have strong technical patterns and we would consider purchase on weakness for the long term. UTILITIES. Electric utihtles continue to show below average relative strength and lMe would aVOid pur- chases at current levels. The natural gaS-OIl pipelInes, however, we feel present an interesting buymg opportunity and we would suggest Houston Natural (33) and Northern Natural (58) as buy cand1dates. Also, Kaneb SerV1ces (20) on the American Stock Exchange appears attracllve at current levels. Dow-Jones Industrials (1200 p.m.) 771.59 ANTHONY W. TABELL S & P Compo (1200 p.m.) 83.96 DELAFIELD, HARVEY, TABELL Cumulative Index (3/26/75) 474.18 RJS/jb No statement or expression of opinion or any other matter herein contained IS, ar IS to be deemed to be, directly or md,rectly, an offer or the SOliCitation of on offer to buy or sell any security referred to or menlioned The matter IS presented mllrely for the converlence of the wbscflber While He believe the sources of our Information to be rellCble, we In no way represent or guarantee the accuracy Thereof nor of the Iatements mude he'em Any action to be token by the subSCriber should be based on hiS own mveshgahon and Information Janney Montgomery SColt, Inc, as a corporation, and lIS officers or employees, may now have, or may later Toke, POSitions or trades In respect to any securltle mentioned In thiS or any future ISSue, and such pOSition rn.oy be ddferent from any views now or hereafter expressed In th.s 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 and other customers mdependently of any statements mode ,n thiS or In any other laue further information on any secl.mty mentioned herem IS available On request

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