Viewing Month: November 1976

Tabell’s Market Letter – November 05, 1976

Tabell’s Market Letter – November 05, 1976

Tabell's Market Letter - November 05, 1976
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TABELL'S MARKET LETTER 909 STATE ROAC, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK eXCHANGE November 5, 1976 As those who read last week's comments will be aware, this letter has managed to maintain its 28-year unblemished record of successfully predicting Presidential elections although 'we must admit'some'momentsof trepidationin the wee–hours of-Wednesday'morningPersonally;— we are happy to put the business of President guessing aside for another four years and return to our normal task of trying to make some sense out of the action of the stock market. Before putting the election behind us, however, it is, perhaps, advisable to see if, now that the result is known, it is telling us anything about the stock market outlook for the re- mainder of the year. We have commented in the past about the overall election-year pattern, and we will not bore the reader with those statistics again. The new development, of course, is the accession of Mr. Carter which makes the current election unique in two categories, first, that we have elected a Democrat, something which has occurred on nine previous occasions in this cen- tury, and, second, that we have rejected the incumbent Presidential party, a happening that has taken place on six previous occasions. The market's record following a Democratic victory is a mixed one. It is slightly biased toward the bullish side for the month of November, five of nine Novembers in which Democrats have been elected to the Presidency having been up months. The December record is less optimistic. In six of the nine years in which Democrats have been elected, the market closed lower in December than in October. Even in one of the three years when the Dow close was higher, the market was down in December although not by a sufficient amount to bring it to a new low. This tendency has to be rated as having some Significance, especially in view of the fact that, overall, December tends to be a strong month. When we come to the record covering the shift of power from one party to another, we find it s trangelymixQ.. On.thr,e 29i!' ions -,hen suclJ. a!,hiftLt9Ikp!'lCeA!he. rna,rke! has been down in both November and December and on the other three occasions, it has been up. Even more interestingly, the down months occurred in the first three years that a shift of power occurr\ed, 1912, 1920 and 1932, whereas, in each of the last three cases, 1952, 1960 and 196B, the shift of power produced two up months. We leave it to others to speculate on the significance of this! phenomenon. Having left the election behind, we can now return to the technical position of stock market which is just about unchanged from its position two weeks ago prior to the election's tak- ing place. The Dow remains in the position of having penetrated its eight-month trading range on the downside and has not, to date, followed through on that penetration, not having posted a new low since October 12. It had rallied modestly just prior to the election, declined immediately following election day and now finds itself again flirting with its pre-election day highs. Those bullishly inclined will, of course, interpret this action as part of a basing process which will lead to an ultimate move to and possibly through the trading range just under 1000 which has characterized so much of 1976 to date. Those who read the potential top formation on the Dow literally will see last month's action as nothing more than a pause prior to a move to new lows. As was the case before the election, the Dow remains the only index showing a pat- tern of this nature. None of the broad-based indices, S & P 425, S & P 500 or the NYSE Industrial and Composite indices, have yet moved below their lows of early this summer and are still com- fortably above them. We remain, therefore, on the horns of a dilemma identical to that which 'faced us back in October. Is the Dow reflectirig weakness in Hie marKet asa whole;or'is-itsim- ply expressing the presence of a parochial weakness in a large number of its components In terms of attempting to resolve this dilemma, we would prefer to lay low for a while and let the market make whatever adjustment needs to be made to the prospect of a Jimmy Carter presidency. It seems to us there are few clear expectations built into the present price structure about just what Mr. Carter's intentions are and, inevitably, as he makes the decisions he must make in forthcoming weeks, those intentions will become clearer. Likewise clearer will be their implications as far as the stock market is concerned. Dow-Jones Industrials (1200 p.m.) 954.29 S & P Composite (1200 p.m.) 101.97 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (11/4/76) 601.39 AWT/jb No statement or expresSion of opinion or any other mallcr here'n contaIned Is, or IS 10 be deemed to be, directly or mdHcclly, on offer or the So!JCllollon of on offer to buy or sell any sec;unly refelTed 10 or mentioned The moIler IS presenled merely fOf the convellcnC(I of the subscriber WhIle we believe the sources of our Informahan to be reliable, we In no way repreent or guarantee the accurocy thereof nor of the statements mude herein tny action to be token by the subscriber should be based on hiS own investigation end information Janney Montgomery SCali, Inc, as a corporation, and ItS officers or employees, may now have, or may later toke, poSlhons or trades m respecl to any secunlles mentioned In Ihls or ony future nsue, and such poSition may be different from any Vley,s now or hereafter e;o;pressed In Ih,s or ony other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC as on Investment adVisor, may give adVice to Its Investment adVISOry ond other customers Independently of any s'clements IT'ode ' thn or In any other Issue Further Information on any security menlloned herein IS oVOIlable on request

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Tabell’s Market Letter – November 12, 1976

Tabell’s Market Letter – November 12, 1976

Tabell's Market Letter - November 12, 1976
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–…….- – TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON. NEW .JERSEY 08!540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE November 12, 1976 The market slide continued last week as the Dow moved on Wednesday to a new closing low of 924.04. If the new lows have done nothing else, they have, at least, given us a – mea clin surable ing at a 'downt rate of rend-channel.-' approximately ThatLchann two points el ,is.app per day, r ox wi i t m h ate its ly. 65points. wide upper limit curre and ntly ,is at ,anow,dde9- ' 57. I . . Eventual penetra'tion of that channel may well give us an initial clue as to possibilities of a mar- ket reversal. We have drawn attention in the past to the fact that the composition of the Dow seemed to be making the decline appear more serious than it truly was. This is confirmed by the action of our breadth index which, of course, measures the action of all listed stocks. The drop in the Dow to date has been 8.94. The following table lists all DJIA declines of 10 or greater since 1950 and shows the high, the date the decline first reached 8.94 and the number of pOints breadth had dropped on that date. Following this is the date of the ultimate low and the final percentage drop. DAlE DATE DROP bl,IADTH IJA1E II; ———– —- -OF HIGH D..JIA REACHED t;.'!4 DROP .– .,. w .– -.- -01' — -.L.O-W- D..JIA 0 – Of,OP .. ..J11i1 12 JYO 2tl.3tl ..JLJN 2Y 1u1l -23. tl 0JL D 1YO 1 Y7. 4 -1;. Il ..JAN 1Y3 2Y3.7Y ..JUN Y 1Y.) -.),'.37 . ,SEP 14 1Y3 2.4tJ -13.U4 SEP 23 1y,,'o 4tl7.4 OCT 1U 1YJ -2b.4 OCT 11 lYO 43tl.Y -lU.U2 APR 6 lY6 1.0 MAY 24 1Yb -20.12 MAY 2tl 1Y0 46tl.tl1 -10.U3 AUG 2 1'!o 2U.Y OCT 1 lYbh -3,). b7 FEI! 12 lY7 44.tl2 -12.bY ..JUL 12 1Y7 20. 7 I AUG 20 1Y07 -27.tlO OCT 22 1Yb7 41Y.7-J -l.,j A'jG-3 -1 Y'J-6 7tl-.-i-O -SE-P'-2;-1-Yb'Jl\6-.-1l9,NQV—1 Yto'J -bbU. Y2—-1 tl-.-76 JAN b 1960 6tl.47 JAN 2Y 1'J60 -lh.Y7 OCT 2b 1Y60 O6n.O!J -17 .42 DIC 13 1Y61 7,)4. n APk 30 1'62 -2.43 JlIN 20 lY62 03b.70 -27.10 MAY 14 1'0160 Yj'. 62 ..JUN 2b 1'-J6 -36.4b JlIN 2tl 1Y60 tl40.'Y -lU.b4 En '01 140(' y'-), .l MAY 0 lYOll -3b.24 OCT 7 lY6 74' 32 -2b.2l SEP 2 1Y67 Y43. lIH NOV 3 1'0107 -2H.b7 MA', 21 lY6tl eb.1.) -12.b1 DEC 3 1Y6tl b.21 JUN 12 1Y6Y -t;q.10 MAY 20 1Y7U 631.10 -3b.Y4 APR 2tl lY71 YbO.tl2 JUL 2Y 171 -3tl.O\l NOV 23 1\171 7\17.\11 -16.UI! JAN 11 1Y73 OCT 26 1'0173 MAR 13 1\174 NOV 0 1974 JUL 10 1Y70 1001.7U Yb7.U6 b\ll.6b 074. nJ bbl.1l1 rEb 26 1\173 -2tl.OY nov 12 1Y73 -17. -10 t'IAY 21 1\1-14 -36.47 NOV 1Y 1\174 -7.2 AUG 20 1\I-Ib -26.'014 MAR 22 173 flEC 1'0173 OCT 4 1\174 l!EC 0 1 0 74 OCT 1 1\17 Y2b.2U 7tl,.. 31 b4.6 bTl.or. 7b4ol6 -12.03 -2U.14 ;4.4 1 -14.4U -l) .07 SEP 21 1\176 1014.7Y NOV 10 1\176 -11.0\1 NOV 10 ly7b \124.04 -tl.Y4 – -.r– As the table shows, breadth has to date dropped 11.59 points from its September 21 figure. This, interestingly enough, is the smallest drop in breadth accompanying an 8.94 decline on the Dow during the period covered with the single exception of the terminal drop of the 1973-74 bear market. There may be some Significance in this in that, as a glance at the table will show, there is some tendency for drops that do not tum out ultimately to be too se- vere to be preceded by small breadth declines in the early stages. Likewise, there appears to be a tendency for severe declines to start out with very sharp drops in breadth. The most notable exampleis, of'coursethe 1968-70 bear market-in which 'breadth -had plummeted 84 'points by the time the decline on the Dow reached a stage comparable to the present. Although the Dieadth drop at the beginning of the 1973-74 market was not that bad, its final leg in the spri of 1974 produced a 36.47-point drop in breadth. Certainly, there is nothing in the above figures to suggest that the decline is over and, absent new evidence, we feel further lows are a probability. Nonetheless, we think the figures above suggest that the curr ent drop is likely to be of intermediate-term rather than of major significance. Dow-Jones Industrials (1200 p.m.) S & P CompOSite (1200 p.m.) 923.79 98.91 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (11/11/76) 589.79 AWT/jb No stctement or exprenlon of opinion or ony olher matler herein conlCllned IS, or IS 10 be deemed 10 be, dlreclly or md,recrly, on offer or Ihe 5011C110110n of on offer to bvy or sell ony security referred 10 or menlloned The matter IS presented merely for the converllenc of the subScriber Whde we believe the sources of our information to be relloble, we In no way represenl or guarantee the accuracy thereof nor of Ihe statemenls mode herein Any oct,on to be loken by the 1ubscllber should be based on hiS own Investigation and Information Janney Monlgomery Scali, Inc, as 0 corporation, and lIs officers or e'TIployees, may now hove, or may lOfer foe, POSitionS or Irodes In respect 10 any ieCUnfles menhoned In Ih,s or any fulure Issue, and such p051hon may be different from any Views now or hereafter expressed m fhlS or any olher Issue Janney Montgomery Scott, Inc, which IS reglslered wllh Ihe SEC 05 on Investment adVisor, may gIve adVice 10 lIs mveslmenl adVISOry and olhel roMomers tndependently of cny slotements mode tn Ihl5 or tn any other ISue further tnformotlon on any security mentioned herein .s available on request

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Tabell’s Market Letter – November 19, 1976

Tabell’s Market Letter – November 19, 1976

Tabell's Market Letter - November 19, 1976
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 081540 DIVISION OF MEMBER NEW YOAK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE November 19, 1976 A fair degree of strength manifested itself on the stock market scene last week as the Dow- Jones Industrial Average moved sharply ahead from its early November low, notably in a twelve-point -''l'huts day rally –Tne'imProve ment'wa s 'hot onfined to-th-elh-dus trial-segmentof-';he-mak-et'a sth-e — – Utility Average, for example, simultaneously moved ahead to achieve a new three-year high. Trading . volume expanded moderately from its recent sluggish levels reaching 24 million shares on Thursday. Despite this week's strength, the market, in our view, remains in a somewhat uncertain state,and it is perhaps worthwhile to consider the nature of this uncertainty. In such a process, it is always best to start with the known facts. The first known fact is that, as of September 21, we were still in a major bull market, most major averages having posted new peaks around that date, enough above their 1974 lows to deserve the appellation. The second known fact is that, since that time, through November 10, the Dow has declined just under 9, a figure which, on an historical basis, qualifies the drop as an intermediate-term decline. The problem, of course, is that major declines, the sort that end major bull markets, inevitably pass 9 somewhere on the way down. The central question, therefore, consists of whether the recent,weakness is the start of a major bear mar- ket which will firmly fix the end date of the 1973-75 major upswing at September 21 or an intermediate- term decline which mayor may not proceed a bit further but which, at some point not too far from current levels, will reverse itself and produce a worthwhile upside move. As we have stated in previous issues of this letter, the strongest argument in favor of the major-bear-market scenario is the pattern on the Dow-Jones Industrial Average which, if it is read as a distributional top, does, indeed, suggest a decline of major proportions. As we have also been pointing out, however, this weakness has been largely localized. It is a strange bear market, indeed, when the utilities, as noted above, post a new three-year peak. The Dow-Jones Transportation Average has alre'ady reached the downside objective of a minor top and ha's moved into an uptrend on a horttermDas is MosfOnhToroaa;based'inorces'1iioVea'Oown -olTth-eTecennvea kh'e'ssto-tes!'their-;– lows of last summer but did not decisively penetrate those lows,and, as we tried to suggest statisti- cally last week, breadth deterioration has been relatively minor, thus suggesting that the average stock has been acting nowhere near as badly as the widely-followed Dow. We have thus chosen, as our readers are aware, to operate for the time being on the assump- tion that the present weakness is intermediate-term in nature, rather than the start of a major collapse. Operating on this assumption, however, poses another dilemma for the forecaster in that intermediate- term bottoms often tend to be more tentative and difficult to identify than major lows. At the time of truly important market bottoms, the existence of a bear market is already firmly established, and we can look for those familiar Signs of a selling climax which so often suggest that a trough has been reached. At intermediate-term lows, these Signs are seldom present, and identifying the bottom con- sists of recognizing a sequence of events which normally develop as the market halts its slide and starts to move ahead. Such will undoubtedly be the case in the present instance. Last week's market strength was sufficient to turn some of the most sensitive technical indicators to a bullish configuration. The problem with sensitive indicators, of course, is that while they rarely fall to identify bottoms, they are prone to false signals. It is, at the moment, only this sort of indicator which has turned positive, thus giving scant ground for an unreservedly optimistic forecast. The next step in a chain of events suggesting an intermediate-term bottom would be an up- side penetration by the Dow of its mathematically-computed downtrend channel, the upper limit of that channel being currently at 947. Obviously, this has also taken place, but it would have to hold fora few-days to be considered'decTsive'AstllClaler'step woul;rbthe'aliilitYcifthe'Dow to reach – , 968 (a comparable figure is 103 on the S & P 500). This would move the index out of its most recent trading range and suggest, at the very least, an attack on the overhead supply from last summer. Meanwhile, we must continually be aware of any developing evidence that our original hypothesis is incorrect and that a major decline is, indeed, in the offing. This would have to take the form of further broad deterioration in large numbers of individual stock patterns and has not, to date, occurred. We have commented in the past on the inadvisability of rushing out with forecasts at a time when the evidence is incomplete. Such, we believe, is the case at the present. Dow-Jones Industrials (1200 p.m.) 950.38 S & P Composite (1200 p.m.) 102.03 ANTHONYW. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (11/18/76) 602.19 AWT/jb No slotemer'l' to bvy or sell or expression of opinion or any other ony security referred to or mentioned matter herein The matter IS contolned presented IS, or IS 10 be merely for the cdoenevmee…dre1n0cboef, dlrect!y or .ndlrectly. the subscriber While on we offer or believe the the soliCitation of sources of our on offer Infarmo lion to be reliable, we In no way represent or guarantee Ine accuracy Inereaf nor of the statements mode herein. Any action to be token by tne subscriber should be based on hiS own Investlgallon and Informolron Janney Montgomery Scali, Inc, as a corporation, and Its officers or employees, may now have, or may loter toke, positions or trodes In respect to any securIties mentioned In thiS or any future Issue, and such pOSition may be different from 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 and other customers Independently of any statements made In thiS or In any other Issue Further Information on any security mentioned herein IS aVailable on request

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Tabell’s Market Letter – November 26, 1976

Tabell’s Market Letter – November 26, 1976

Tabell's Market Letter - November 26, 1976
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY OB540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE. INC MEM8ER AMERICAN STOCK eXCHANGE – '- November 26, 1976 We write this after participating, with our family, in the annual American ritual of ''-..-'– …….-. -.,..–…- '- . – –.-…;….– ,,–… ———–.– -,- – —-'-.–'-.– gorging ourselves with large amounts of turkey and accoutrements. This ritual, of course; has-' -, come to be known as Thanksgiving Day and it is, perhaps, worth pondering what it is all about and what, really, we are, in the process of giving ourselves indigestion, being thankful for. There are two separate aspects, we suppose. The first is a commemoration of the original feast held by the intrepid members of the Massachusetts Bay colony in celebration of their safe deliverance onto a barren Cape Cod beach. A second reason for the celebration, we suspect, is gratitude for what, over three centuries, that barren outpost on a New England shore has evolved into — a nation with an economy that can afford such luxuries as a stock market. Consideration of our puritan heritage is not, we think, entirely inappropriate in a letter whose main concern is, in fact, that stock market. One of the puritan virtues, we are reg- ularly reminded, was that of thrift. It is thrift, of course, that leads to capital accumulation and, thus, a need for investment. As this whole process continues and compounds over a series of generations, the need, in a free economy at least, for an institution such as an equity market, becomes apparent. It is, of course, rather naive to ascribe the growth of the American economy over 300 years purely to the practice of a puritan thrift. It is, also, somewhat at variance with the facts. America has had, even going back to colonial times, a history of a relatively high rate of consumption and a low rate of savings. The process of capital formation, historically, was a slow one, and real per capita income in the United States did not actually begin to grow dramatically un- til the post-Civil War period — more than 200 years after the arrival of the first colonists on our ,shore .Moreover, the-evidence suggests4hatour-'forebea rs-practiced'les s-financia I-rectitude ,than' ….. we are wont to credit them with. Herman E. Krooss in American Economic Development (Prentice- Hall, 1955) relates the following. In 1690, Massachusetts issued 7,000 of one-year notes. Theoretically, these were issued in anticipation of taxes, but in reality not enough tax revenue,was ever raised to retire them. Yet, the experiment worked out so well that more paper money was quickly printed. Meanwhile, the other colonies, impressed by Massachusetts' ingenuity, also began to issue paper money. It becomes evident that the present administration of New York City is acting in the best of American tradition. Notwithstanding all this, a prodigious amount of capital accumulation has, indeed, taken place over 336 years, and per capita wealth, much of it embodied in the market value of those stocks it is our regular business to study, has grown astronomically. Much has been made, for example, of the growing institutionalization of equity markets. What is overlooked, of course, is that institutions are only intermediaries. This vast repository of wealth is, in the end, nothing more than the wealth of individual Americans who are, indeed, individually wealthy at a level in- conceivable to the colonists of 300 years ago. We have even proceeded to the point of being able to question whether economic growth, at least, in the terms we ha—,,-o.lll,u-,,.\!!1-der!!.anr;l.it,.iS a.to!allYrunmixd blessing.and, , ,to cons'iaer-wheth-er futur-e economic planning should not envision a slower growth rate. This pros- pect may well be part of the reason for what we have called the central technical fact about the stock market over the past decade, the fact that, on average, it has moved sideways as con- trasted with the upward secular trend of the 1950's and 1960's. Nonetheless, as we suggested above, the fact that America has been able, over three centuries, to accumulate a sufhcient stock of worldly goods to require a large and sophisticated financial industry constitutes an achieve- ment worthy of some note. We have, we think, every right to be thankful for that achievement. Dow-Jones Industrials (1200 p.m.) S & P CompOSite (1200 p.m.) Cumulative Index (11/24/76) AWT/jb 951.88 102.59 612.06 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No statement or expreSSion of opiniOn or any olher matler herein contained IS, or IS to be deemed 10 be, dneClly or Ind,rectly, en offer or 'he Ollcltollon of on offer to buy or sell ony security referred 10 or mentioned The naIler IS presented merely for Ihe converlence of the subscnber While He believe the ources of our information to be rehoble, we m no way represent or guorantee the accuracy thereof nor of the statements mode herem Anv action to be token by the subscriber should be bosed on hiS own Investlgotlon nd Informotlon Janney Montgomery Scott, tnc, os a corporation, and lis offICers or employees, may now have, or moy later take, poSitions or trades In respect to any securities mentioned In thiS or any future Issue, ond such pOSition may be different from any views now or hereafter expressed ,1'1 thiS or 01'1'1 other Issue Janney Montgomery Scott, Inc, which IS registered With le SEC as on Investment adVisor, moy gIVe adVice to Its Investment odvisory and Olher customers Independently of ony stotements mode In thrs or In any other Issue Further Informotlon on any secuflty mentioned herein IS avolloble on request

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