Viewing Month: September 1977

Tabell’s Market Letter – September 02, 1977

Tabell’s Market Letter – September 02, 1977

Tabell's Market Letter - September 02, 1977
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TABELL-S MARKET LETTER , 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW YOAK STOCK eXCHANGE, tNC MEMBER AMERICAN STOCK eXCHANGE September 2, 1977 Nervous markets — it Is hard to describe the current market as anything other than -,I —-nervous ,,– have a-tendency to beobsessed-wlth nu-riibers -regardlessof whether or-not theparticular- numbers Involved have any real significance. Thus, a stock market rally found itself aborted earlier this week as the Commerce Department announced that Its Index of leading indicators fell In July for the third consecutive month. The market chose to Ignore the reassuring statements enanatlng from various Administration spokesmen who assured us that the three-month dip Indicated nothing more than a slowdown in the rate of economic expansion and not a possible (gulp!) recession. The re- assuring spokesmen were not, as we shall see below, on totally unsolid ground and, yet, it remains a fact that the leading-Indicator composite was put together In the first place because its components tend to lead — and what they tend to lead Is ,In fact, economic contractions. The job of the technician, of course, Is to look at numbers as dispassionately as possible and not at whatever rationale happens to be currently offered for the behavior of those numbers. The leading-Indicator series, therefore, Is, at this time, worth a look. To begin with, there have been no fewer than 39 separate occasions, since 1948, when the series has declined. Of these, it would seem fair to eliminate 21 occasions when the decline lasted for only one or two months. This leaves us with 18 occurrences similar to the present one where the leading indicators have dropped for a three-month or longer period. Six of these 1B declines were just three months In length and the other 12 were longer, with the two longest periods of con- secutive decline being 11 months. The first fact that Is perhaps worthy of note Is that in the 30-some-odd years under study, despite 18 three-month-or-longer drops in the leading-indicator series, there have been only six -'montre)cjess-sdibo-ness. Thus, on the face of it, il5t-;infaCt7indlcatea there appears recessiO!l.lnd teoe db;eCal otsweor s- t6oi-.oi tn1en yc hsaungcgelSt hUiaattaprdercojpSioHfyt h,.r;e.e………- – t this is the case. There was, for example, a three-month drop In late 1950 and a seven-month decline in the early part of 1951, all this despite the fact that no recession was in the offing for two years. The period 1955-56 saw three separate declining periods of five, four and six months, respectively. No recession occurred until the summer of 1957. A nine-month decline during 1966 foreshadowed no recession whatever and, indeed, by the time it was three months undelWay, the stock market had just about reached a major bottom. This leads In tum to yet another difficulty. Even assuming that the leading indicator series correctly forecasts recessions (and despite the false signals, it has tended to forecast correctly the six recessions in the past 30 years), this does not necessarily suggest its validity as a forecaster of the stock market. Indeed, the stock mar- ket is one of the 12 leading indicators In the composite suggesting its well-known tendency to lead the economy. Thus, one of the six-month declines that correctly forecast a recession was August, 1957-January, 1958. The problem, of course, was that by the time we were three months Into that particular decline, it was October of 1957, Just about the time the stock market had bottomed. In the most recent case, by the time we were three months into an ll-month leading-indicator decline In 1974-75, the ultimate bottom in the market was only a few months away. None of this means that we should totally disregard the behavior of the leading-indicator series, and, indeed, continued weakness would, on the record, be a cause for alarm. At the moment, however, in terms of actual Significance, It can be said, at best, to do nothing more than lend an element of uncertainty to the stock-market scene. While on the subject of numbers, Incidentally, we cannot resist drawing attention to one whfch'received a' gieatdeal-'l-e-s-s'attenticin'tha-w-dlCnh-e 'indicator- composite -OlfWed-nesaay; tne;;o, r- Financial Times Index of the London Market broke 500 on the upside for the first time since the e,,!rly 1970's. This has some Interest in view of the imperfect but reasonably well-documented tendency of this market to lead our own, albeit that this leadership tends to be more noticeable at tops than at bottoms. In the past, at least, declines in the United States market have not tended to be overly serious if the London market was expanding, and that It has certainly been doing, having risen from 265 last fall to Its current level. It will be Interesting to see whether the bull market currently being enjoyed by our friends across the ocean is ultimately transportable to our shores. Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p.m.) Cumulative Index (9/1/77) AWT/jb 867.Bl 97.04 662.74 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No stotement or expression of opinion or any other matter herem contamed n, or IS 10 be deemed to be, directly or indirectly, an offer or the SOllCll0110n of on offer to buy or sell ony seoHily referred 10 or mentioned The mattelr IS presented merely for the converllence of the subscriber While e believe the sources of our Informo tlon 10 be relloble, we In no woy represent or guarontee the accurocy thereof nor of the stotements mude herein Any ocTlon to be token by the subscriber should be based on hiS own investigation and mformatlon Janney Montgomery Scoll, Inc, as a corporation, and 115 officers or employees, may now have, or may later lake, positions or trades In respf!ct to any seCUrities menlloned 1M thiS or ony future ISsue, and such posillon may be different from any views now or hereater evpressed In thiS or any other Inue Jonney Montgomery Scoll, Inc, which IS registered With thc SEC as an Investment adVisor, may give odvlce to Its Investment adVISOry ond olhel customers mdo!Jpendenlly of ony statements made 111 thiS or m ony other Issue Further Information on any security mentioned herem IS available on request

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Tabell’s Market Letter – September 09, 1977

Tabell’s Market Letter – September 09, 1977

Tabell's Market Letter - September 09, 1977
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– f I ! I ! —- TABELL'S MARKET LETTER 1 I \ — —-' 909 STA.TE ROA.D, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANoe. INC MEMBER AMERICAN STOCK EXCHANGE September 9, 1977 We published In this space last June 24th a discussion of computed trend channels for ..-;the,lJRwI'n'!.,!!-!ia!I!!rgal9.111,e!ltE!.gTwith. .Eh,a !!;lowing..,.thtw!r.endthenll\!\slry– In effect. These two channels, representee by the solid and dotted lines on the chart below, ran — from the September 21, 1976 high of 1014.79 and the December 31, 1976 level of 1004.65. The June 24th date is marked on the chart below and, as can be seen, the two trends had largely con- tained the Dow up to that time. What has happened since Is perhaps worthy of further discussion. MAJOR. INTERMEDIATE &MINOR COMPUTED DONTRENDS – DJIA SfTkBER 1. 1977 – fES 1971 I'f'R 1!fl1 P.f'R 1977 I'fI.T 197 …. 1977 …u. 1m JUG Isn 1977 As the chart shows, the Dow backed off from the upper llmlt of the Intermediate-term channel shortly after the June letter was written. It then moved up again In late July and tested the upper llmlt of the channel once more. From that point, on July 22, It began Its current sllde. That sllde can be dellneated by still a third, minor trend channel shown on the right-hand side of the chart. That channel, In tum, has been decisively penetrated on the upside by the recent rally. At Its recent low, the average was precisely at the bottom of the Intermediate channel – – a t around the -850 level. What'lspartlcularlylnferesting 7' more-over;-IS' tharthe '!lottom -levelsof-the — major and Intermediate downtrend channels have converged, thus suggesting that If the Intermedi- ate ehannel Is to be broken, such a break could occur fairly shortly. We have, therefore, three separate events of Importance having occurred In the last two weeks — the convergence of the major and Intermediate channels, the rebound from the bot- tom of both channels and the concomitant penetration of the minor downtrend channel. Whether this reversal will be confirmed by an ultimate upside break above the top of the Intermediate channel, now around the 905 level, remains to be seen. We would certainly regard such a break as having more-than-passlng significance. Dow-Jones Industrials (1200 p.m.) 858.89 S & P CompOSite (1200 p.m.) 96.59 ANTHONYW. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (9/8/77) 666.98 AWT/lb No 51alemenl or expreSlon of opinion or any other motter herein contOlned IS, or IS 10 be deemed 10 be, directly or mdnl!clly, on offer or the 501l(llollon of on offer 10 buy or sell ony secunty referred 10 or mentioned The matter IS presented merely for fhe convenience of the subscriber While we believe the sour!;eS of our Informa tlon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the STatements mude herein Any action to be token by the subSCriber shauld be based an hiS awn InVestlgalion and Infarmatlo'l Janney Montgomery Scott, Inc, as a corporation, and Its officers or employees, moy now have, or may later take, poslhons or frades In respect to any secUrities menlloned III tflls or any future Issue, ond such position may be different from any Views now or hereafter expn!ssed III thIS or any other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC as an Investment adVisor, may give adVice to Its Investment adVISOry and othe, customers Independently of any statements made In thiS or III any other Issue Further IIlfOrmalion on any security mentioned herein IS ovollable on request

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Tabell’s Market Letter – September 16, 1977

Tabell’s Market Letter – September 16, 1977

Tabell's Market Letter - September 16, 1977
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE September 16, 1977 The stock market experienced last week what we have come, privately, to call the Thursdaynoon reversal. This particular technical phenomenon Is a maddeningly recurrent event known only to the ,,-,w;r.,J.WJt!er, !;I,,c ,Ple!l.fgen.!o, ,IIJkell!.lnlrylsmtme. ,n,!h!,dy…after- noon preparatory to final editing on Friday morning and submission to the printer at noon. With devilish regularity, it seems that, whenever the market has been doing something all week with enough consistency to warrant a letter on the subject, It will immediately tum around and do something else, even as the letter is in the process of being dictated. Such was the case last Thursday when we chose to discuss and display a chart on the reversal of the Dow from the bottom of Its computed downtrend channel. Having, moved ahead for seven consecutive days ending on Wednesday and down only modestly at midday Thursday, the Dow chose that juncture to begin another slide which took it, by midweek, close to last month's low, the point from which the rally had started. However sharp the decline, however, it did not negate the basic thinking presented in last week's letter. Indeed, by Tuesday, the Dow had returned once more to almost precisely the bottom of the computed channel we discussed last week and, from that pOint, rallied once more In Wednesday's and Thursday's trading. Admittedly, the less said about the vigor of the rally, the better. Breadth was abysmal,and volume continued in the irregular downtrend that has characterized it since the end of July. Nonetheless, the rally took place, and the rebound from the bottom of the major and intermediate trend channels remains intact. Another thing that remains intact is the rather extraordinarily good behavior of the broad market as compared to the action of the Dow, a phenomenon which has been going on all year .. We were at recent lows, down 15 from year-end figures in terms of the Dow-Jones Industrial Average, a percentage drop unquestionably of intermediate-term proportions and one of sufficient magnitude to have characterized in the past what later came to be regarded as major bear markets. It would be folly to claim that, in this sort of environment, the broad stock exchange list as a whole is not lower than it was –1-. . . f.-when-19 76came'toa 'c10s-.-What -ls..,at-emlyntrlil51e7nowever;-ls-tlfefacttnat'ltrs'7ea11ydo'w'-C'n'-' relatively little from its year-end level and, indeed, by a number of measurements, is really not much lower than It was last February when the Dow was a good 75 pOints higher. The following table shows the Dow and a dally breadth index at various market low pOints since last December 31. As we have stated before, the breadth Index, which is computed from the number of stocks advancing and declining, is, we think, a fair measure of what the broad range of securities is doing. The figures, we think, speak for themselves. DATE Dec 31, 1976 Feb 11, 1977 Feb 25, 1977 Apr 5, 1977 Apr 26, 1977 DIIA 997.34 926.03 926.20 909.74 910.36 BREADTH 101.86 97.03 94.52 92.75 93.07 DATE May 31, 1977 Aug 3, 1977 Aug 26, 1977 Sep 13, 1'977 D)1A 892.55 877.25 844.42 848.49 BREADTH 92.96 97.79 93.73 93.99 Breadth, at Its September 13 low of 93.99, Is obviously lower than It had been at the beginning of the year when the Dow was around 1000. Yet the fact that It Is acting better than the Dow and continues to do so remains evident. On August 26, for example, the breadth Index was at 93.73. This is a level actually above the two lows of April when the Dow was at 910, some 60 pOints higher than current levels. It is not too far off the level of February 25 when the Dow was higher still. Indeed, T throughout the entire period there has been a tendency for, breadth to demonstrate a seIs ll!gher low' asthe'D6Wcdecllned fromriin-orti'eid'bOttbm'ti5'nfinorfrel'-ilbottorri';' Betwee-n the end of May arid'August;-' as the table shows, the breadth Index was actually up almost five points despite a IS-point decline In the Dow. And even on the recent decline, breadth, last week, was able to hold above its end-of-August levi. \ This superior breadth behavior Is a phenomenon of some rarity since breadth Is known to have somewhat of a downward bias. Whatever its long-range significance, it seems to be suggesting, at the moment, that the market, while far from healthy, is a great deal less sick than the action of the averages presently seems to suggest. Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p. m.) Cumulative Index (9/15/77) AWT/jb 860.88 96.78 663.37 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL No stolemen! or eKprcsslon of opInion or any olht!( moHer herein c.ontOlned IS, or IS 10 be deemed to be, direClly or indirectly, an offer or the sol,cltohon of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenience of the subscriber Wh,le we believe the sovrces of our informa- tion to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements mude herein Any odlon to be token by the subscflbcr should be based on hiS own Invesllgotlon ond Informolton Jenney Montgomery Scoll, Inc, os 0 corporation, and Its offICers or employees, moy now have, or may loler loe, posllions or trades In resped to any seCUrities mentloned In i!-IIS or any future Issue, and such pOSition may be different from ony views now or hereafter expressed III thiS or ony other IUue Janney Montgomery Scott, Inc, whICh IS regiSTered With the SEC 05 on Investment adVisor, may give adVice to Its Investment odvlS.ory end othel customers .ndependently of any statements mode In th,s or In any olher Issue Further ,nformatlon on any security menhoned herem IS available an request

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Tabell’s Market Letter – September 23, 1977

Tabell’s Market Letter – September 23, 1977

Tabell's Market Letter - September 23, 1977
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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 September 23, 1977 Following an attempt to bottom at around the 850 level, the Dow slid on Wednesday and —Thursday-to yet-another- newlow-;-reachlng- whbelw–the'840 level-.-,…Slnce .Its,hlgh,of last-September ' (a year ago this week), the average Is now down more than 17 and, on the record, if the phrase bear market does not soon become widely heard, It probably should be. And yet, what we have here appears to be a somewhat unique beast. This can be documented, we think, by asking our readers to bear with us through the following table of numbers. The table shows every one of the 24 declines of 10 or more that have taken place since 1946 and, In the last three columns, the percentage decline, the number of days the decline required and, finally, the average decline per day expressed In hundredths of percentage points. This latter figure Is not nearly as esoteric as It sounds, since It Is an accurate measure of the speed with which the market Is going lower — In other words, the steepness of the drop. Start Date May 29 1946 Feb 8 1947 Jul 24 1947 Jun 15 1948 Jun 12 1950 Jan 5 1953 Scp 23 1955 Apr 6 1956 .\ug 2 1956 Jul 12 1957 Aug 3 1959 Jan-5-16-o Dec 13 1961 May 14 1965 Feb 9 1966 Scp 25 1967 Dec 3 1968 Apr 28 1971 Jan 11 1973 Oct 26 1973 Mar 13 1974 Nov 5 1974 Jul 15 1975 Sep 21 1976 DJIA End Date 212.50 Oct 9 1946 1fl4.49 May 17 1947 186.85 Mar 16 1948 193.16 Jun 13 1949 228.38 Jul 13 1950 293.79 Sep 14 1953 487.45 Oct 11 1955 521. 05 t1ay 28 1956 520.95 Feb 12 1957 520.77 Oct 22 1957 678.10 Nov 9 1959 b-8-5 o-4/-Oc t-251'96-0 – 734.91 Jun 26 1962 939.62 Jun 28 1965 995.15 943.08 Oct 7 1966 Mar 21 1968 985.21 May 26 1970 950.82 Nov 23 1971 1051.70 Aug 22 1973 987.06 Dec 5 1973 891.66 Oct 4 1974 674.75 Dec 6 1974 881. 81 Oct 1 1975 1014. 79 Scp 21 1977 – DJIA 163.12 163.21 165.39 161. 60 197.44 255.49 438.59 468.81 454.82 419.79 550.92 566-05 535.76 840.59 744.32 825.13 631.16 797.97 851. 90 788.31 584. 56 577. 60 784.16 840.78 decline No.of Days Per Day -23.24 93 25.0 -11. 53 81 14.2 -11. 49 182 6.3 -16.34 281 5.8 -13.55 22 61. 6 -13.04 176 7.4 -10.02 12 83.5 -10.03 36 27.9 -12.69 132 9.6 -19.39 71 27.3 -18.76 68 -17-'42–2-05 27.6 . -B;-5- -27.10 134 20.2 -10. 54 30 35.1 -25.21 167 15.1 -12.51 122 10.3 -35.94 367 9.8 -16.08 146 11. 0 -19.00 154 12.3 -20.14 27 74.6 -34.44 143 24.1 -14.40 22 65.5 -11. 07 55 20.1 -17.15 252 6.8 – Let us look first at the column which shows the percentage decline for each of the 24 drops. The present dip of 17.15 has been exceeded by only nine previous downswings over a 31- year period, most of those now recognized as having been major bear markets. It seems quite clear that,ln terms of the Dow at least, what has happened over the past year Is approaching reasonably serious proportions. What Is strange about the current Instance, however, Is the number of days which It has taken the present stock market to arrive at Its present level. The decline has been exceeded In number of trading days by only two markets In the past, those of 1968-70 and 1948-49, and, If the market continues lower, that last record will be exceeded In another month. Even If one chooses to – -vlenlfecentlre perloa'January;1973-Decembe-;-t974'a's'one'ofcontinuousdeClIne-; It totals OiiJy-43'j days. We are rapidly, In the present case, g'ettlng Into that league. In terms of steepness, however, we have quite clearly at the moment one of the flattest drops In three decades of market hlsOry. Only two declines have moved downward at a slower rate those within the basing period of the late 1940' s. Almost every decline that has come to be known as a major bear market has Involved a considerably steeper drop than the current case,and,even for the first 252 days of the 1970 decline, the rate was a good deal steeper than the current one. A glance at the table quite clearly demonstrates, as far as we are able to see, that this sort of flatness appears characteristic of Intermediate-term drops rather than major downswings. Dow-Jones Industrials (1100 p.m.) 841.48 ANTHONYW. TABELL S & P Composite (1l00 p.m.) 95.23 DELAFIELD, HARVEY, TABELL Cumulative Index (9/22/77) 654.45 AWT/jb No statement or epreSlon of opinion or any other matlcr herem contaIned Is, or , to be deemed to be, dorectly or tndtrecily, on offer or the 101l(llollon of on offer to buy or sell ony security referred to or mentioned The molter ., presented merely for the conve,cn of the subcrlber WhIle we believe the sources of our Information 10 be reliable, we In no way represent Of guarantee Ihe accuracy thereof nor of Ihe stolcmenls mude herein Any odlcn to be toen by Ihc subKrlber should be bosed on hiS own Invcsllgolron and Information Janney Montgomery ScalI, Inc. 0 0 corporation, and .IS offIcers or employees, may now hove, or may loler toke. POSitions or Irades In respect 10 any securities mentioned In Ihls or ony future IUe, and such POSition may be different from any views now or hereafter e,.prcsscd 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 othel C\Jslomers Independently of any statements made In thiS or In any other ISsue Further Information on ony seo,mty mentioned herein IS ovallable on request

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