Viewing Month: February 1979

Tabell’s Market Letter – February 02, 1979

Tabell’s Market Letter – February 02, 1979

Tabell's Market Letter - February 02, 1979
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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 February 2, 1979 ..; We have been focusing In recent weeks on the somewhat confusing picture being presented by general market action. It Is well to remember, however, while all this Is going on, that shifts In leadership among Individual stocks and Industry groups are taking place. It Is worthwhile, therefore, to keep In mind the loci of above-average strength, Irrespective of market action. The following table analylzes the Standard & Poor Industry Group Indices on the basis of their action relative to the S & P 500, In other words, whether they are acting better or worse than the general market. It defines each group as being In an up or down trend relative to the market, and further subdivides each category In terms of whether the trend Is continuing or showing signs of Continuing AEI()SPACt; ALlMINLM AllrU PARiS – AFTER MKl' BEVERAGIh – DISTILLERS BLDl. MAl'RLS – A1R CCND Eu,;(;TRUNIC; ELtX.TRUNICh (SEMI/(llo!P) ENl'ERTA1N'llNl' FtXJIS – CANNED HDrEL/I'Ul'IL MACHINE '10018 MACHINERY – AGRIC . . MACH–ONST/MAl'1!L MIl'A!b MI;C (J,'F'lCI OF(. – EXCL IBM OIL – CRUDE PR!ll. OIL WELL Q & SVC PUBLIhHING TElITIb – APPAIlliL TOTh VENuING MACHINIS CCSMErICS BClIE FURNISHlNGS UlL – OCMESTIC INTEG UIL – INl'L INTEG OIL – COMlUSITE PUBLlSHING (NEWSPAPEll;) BRDCA;TRS – RADlU/TV SOAPS TCBACCO/CIGAllliTrE MANU BANKS – UursIDE NYC INSURANCE – LIFE RELATIVE DOWNTRENDS Continuing Improving AUI'OMUBILE Aura TROCKS & PARr Aura EXC GEN MOl'URS Aura PARTS-JRIG EQjIP BEVERAGES – BREWEHS BEVERAGES-SOFT DRINKS CHEMICAIS BIJX; MATRlli – CEMENr CCNrNRS – MEI'AL/GlASS BIJ); MA1Rlli-HEATjPLlMB ElECTRICAL EQjIP BIJ); MATRlli-RCOF/WIllD ElEC/ELECTRN-MAJOR (.'(8 BUILDING MATRlli – COMP ELtX.T BOUSEHULU APl' COAL – BITlMINUUS FCOIS DAIRY PRUll, lUlGllMERA'lliS FooIS MEAT PACKING DRu.;s FOOIS PACKAGED FCOIS (.U1lUSITt; FOOD SUGAR FOIillT, PRUWC'lb LEAD & ZIN WLD MINING UFFhHORt; DRILLING LEISURt; TIME PAPER MACHINERY – IND/SPEC RESTAt.JRA!ID, MErAL FAllRICATlNG RE'l'AIL S'l\J1ill – DEPl' , MUBIlli H\.ME; ru.'rAIL S'l\JRES (DRUG) RlLLDTIUN CLN1'RUL GENIRAL MER..HAND1SE CHAIM JAILRUA.D IQjlP. – Rt;AL t;STA'l't; lliln'llli PRULU'lh S'l\J1!J.b – or;c. TEXl'lLES – SYN'l'H FIBK STRS-FUlU CHN; ELECTRIC IU;ER SHOES NATURAL GAl – orSTRffi, TElliPHUNE STEEL – EXCL US S'l'Et;L TELEPHUNE – EXCL AT&T T lRt; & RUBBI;! lUJIS RAILR0AI6 NATURAL G/lli-PI PEWS TROCKERl AIR TRANSRlRl' BANKS – NEW YORK CTl'Y INSURANCE – MULT1 LN. INSURANCE – PR!P/LIAB SAVINGS & Iil\N AS;U, UlANS Rt;AL ESTATE lNV TRUSTh FINANCECUS INVE'1MtNl' (.'U; Of Interest Is the pres ence In the continuing uptrend category of a number of quality/growth groups such as Electronics and Office Equipment, along with a number of non-ferrous metal categories. Other growth Industry classifications such as Drugs and Soft DrInks, while they remain In relative downtrends, appear to be showing Improving action. The continuing downtrend category appears to comprise two major areas, consumer/defensive Issues such as Foods and Retailers and yield Issues such as Utilities and Banks. Possible future developments which should be watched would be continued Improvement In basic Industries such as Forest Products, Steels, Building Materials and possible further deterioration In Oils, a major category whose relative action has been deteriorating. Dow-Jones Industrials (1200 p.m.) 837.23 S & P CompOSite (1200 p.m.) 99.77 ANTHONYW. TABELL DELAFIELD, HARVEY, TABELL Cumulative Index (2/1/79) 720.79 AWTrak No slatement or expression of opinion or any other matter herein contained IS, or IS to be deemed 10 be, directly or indirectly, on offer or the ollcltotlOn of on offer to buy or sell any security referred to or mentioned The motler IS presented merely for the of the- subSCriber While Ne believe Ihe sources olbour hnfi;rb lion 10 be reliable we In no way represent or guarantee the accurocy thereof nor of Ihe statement, mode herein Any action 10 be token by Ihe subscn er s ou e based on hll own'lrwesllgotlon and Informoflon Janney Montgomery SCOII, Inc, as a corporation, and lIs of/lcers or employees, may now have, or moy later toke, pOSlhons or trades In respect 10 any secUrities menlloned In Ihls or any future Issue, and such pOSition may be different from any views now or hereoJler 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 a vnoryon ot el customers Independently of any stotements mode In thn or In any other ISsue Further information on any security mentioned herem IS avolloble on request

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Tabell’s Market Letter – February 09, 1979

Tabell’s Market Letter – February 09, 1979

Tabell's Market Letter - February 09, 1979
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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 , ., . 19.79. It was SatchelPaige who formulated the 'delightful rule-of'conduct. Don't–look back;something might be gaining on you. The stock market. over the past year or so. has apparently formulated its own variation on this rule. which may be stated as. Don't look ahead; something out there is waiting for you. The spectre which the market has been seeing just around the next bend for over a year now is. of course. that ole debbil recession. the imminence of which has become an article of faith among most forec,asters. Had the recession arrived when the original entrail readers expected it. it would have been here now and perhaps even over. It has not. however. arrived and thus remains a convenient bogeyman pushed progressively. quarter by quarter. into the future as economic reali- ties continue to confound expectations. This Wednesday's lead story in the WALL STREET JOURNAL was almost a paraphrase of the sort of thing which we have been seeing in the financial press all year. It noted in the main headline that corporate profits rose 28 in thp. fourth quarter of 1978 and went on to say. indeed, that a further gain was forecast for the first quarter of 1979. Indeed, it duly noted that pr'ofits not only increased in the last year's final quarter but that the rate of increase throughout the year continued to rise — increasing from 3.4 in the first period of the year to 10. to 21, to the final 28 — and suggested even further that the first-quarter rate of increase might expand to 30-35. But look out fellows.it's still out there. The sub-head duly noted;'But After the First Quarter Many Analysts See Firms Hit by Slowing Economy. We would feel more comfortable with the forecast had not many analysts been looking ahead to the same thing as long as one to two years ago. John Kenneth Galbraith coined the term. Conventional Wisdom. to denote that body of know- ledge to which those not so enlightened as he subscribed. but which he. in his wisdom, knew to be mythical. We would not go so far as to dispute those whose experience at economic forecasting is g,eater than .Q!!rs hfllp !hat ability nas become il bit tiresomEr;' …. – – — insistence on a — ..-.. – inevit- The only instance we can recall of similar unanimity was in the late 1940's. At that time, it was universally agreed that World War II inevitably had to bring out a post-war recession. Interestingly enough. the late forties produced the last instance comparable to the present one in which stock prices persistently ignored rising profits with the absolute certainty that they constituted a transitory phen- omenon. The much-heralded recession never arrived. What did arrive was a 19-year super-cycle bull market. Now we are not necessarily suggesting the near term likelihood of such a market or even ques- tioning whether the universally-forecast recession will in fact take place. We are merely suggesting that the recession has been forecast for so long now that a great deal of its negative effects may indeed be built into present levels of stock prices. much as the inevitable post-war depression was built into the market levels of 1949. The available figures quite clearly show a massive buildup of cash on thc part of large numbers of professional investors — a buildup which has continued for the past year and a half. If a recession is to produce lower stock prices, it must, perforce. bring forth sellers of stock. It is. in our view. an eminently agreeable premise that, whether or not it ever occurs, the anticipated recession has already brought forth such sellers. It seems reasonable to question whether those who sold stocks in anticipation of a recession are continuing to hold more stock for sale when that recession occurs. T his letter has never advocated an attitude of permanent impatience with conventional wisdom. Indeed. most of the time, we think it is correct, which is why stock market trends tend to persist. We are inclined to suggest at the moment. however. that a certain skepticism regarding the allegedly upcoming recession and its effects milrht well be warranted Indeed. with the recession refusing to materialize. the market seems eager to focus on new worries. The latest convenient one is. of course. Iran and prices duly moved lower over the past two weeks in response to political uncertainties there and dire warnings from Secretary Schlesinger. Dow-Jones Industrials (1200 p.m.) 822.68 ANTHONY W. TABELL S & P Compsite (1200 p.m.) 97.98 DELAFIELD. HARVEY, TABELL Cumulative Index (2/8/79) 706.13 AWTrak No stalement or expreSSion of opinion or any olner motter hercln contolned 1, or IS 10 be deemed to be, d,redly or md,rectlr,' on oHer or Ihe sol,cltotlon of an offer to buy or sell onr, security referred 10 or mentioned The motler IS presented merely for the convef'1lenCE of the subSCriber Wh, e we believe the sources of our informa- tion to be fel,ab e, we In no way represent or guarantee Ihe accuracy Ihereof nor of Ihe statements mode herein Any ocllon to be token by the subscriber should be based on hls own Investlgollon and Information Janney Montgomery SCali, Inc, as a corporation, and .ts officers or employees, may now have, or may later toke, positions or trades In respect to any securities menlloned In thiS or any future Issue, and such position may be different from any views now or hereofter expressed .n Ihn or any other Issue Janney Montgomery Scott, Inc, which IS registered With the SEC as an mvestment odv,sor, may give odvlce to .ts Investment adVISOry and olhe. rostomers Independently of any statements made ,n thiS or .n any other ISSue Further information on ony security mentioned herein IS available on request

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Tabell’s Market Letter – February 16, 1979

Tabell’s Market Letter – February 16, 1979

Tabell's Market Letter - February 16, 1979
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TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORl( STOCK EXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE – February 16, 1979 We discussed in some detail three weeks ago some of the problems posed in looking at a market which-has behaved' like.the'one of the past'five months' -i'ecentfy asSepteinber-; It -will-be -re-' called, that the major averages posted new 1978 highs, having spent the better part of the year moving ahead. Since that time, of course, those highs have not been exceeded, but the subsequent lows on major indicators, chalked up at various points last fall, have not been exceeded either. Market-letter writers have a delightful habit of describing trading action in accordance with their own preconceived interpretations of the facts. We ourselves, inclined toward the feeling that the Sept- ember high may ultimately be bettered, began to describe the market in January as resuming an ongoing uptrend. Our more pessimistic colleagues, on the other hand, perhaps a bit confounded by January's strength, gleefully noted the weakness of the first week in February with comments stating that a major downtrend had in fact reasserted itself, implying that it was only a matter of time before the lows of last fall were exceeded. Market analysis being somewhat less than an exact science, there will be no way of proclaiming with certainty which view is correct until either decisive new highs or lows are achieved. It is perhaps worthwhile trying to look at the behavior of the market over the past five months in a bit more detail, which we attempt to do in the' following table. It shows some recent benchmark points for three widely-followed market indicators, the Dow-Jones Industrial Average, S &P 500, and the Ameri- can Stock Exchange Index, plus our daily breadth index, based on advances and declines, and our Cum- ulative Index, based on percentage changes of all NYSE-listed issues. The benchmarks shown are the September high, the October 31st low, the mid-November and December lows, the January high, and the lows of a week ago. DJIA S&P AMEX BREADTH CUMULATIVE September High 907.74 106. 99 176. 87 853.78 830.54 October 31st Low 792.45 93.15 136.75 805.17 656.07 -785. 26, '''' 92 ..49 . 138.98 .. ' 801..96 647 . Mid-December Low — 787.51 93.48 145.68 802.06 658.98 January High 859.75 101. 73 162.35 819.60 729.30 February 7th Low 816.01 97.16 156.99 811. 46 703.45 The five indicators shown have exhibited consistent behavior in many respects. All of them posted highs in mid-September at levels significantly above present prices. They all declined to the end of October in the late, unlamented Halloween Massacre. Subsequently, two lows in the same general vicinity were posted. The one in mid-November was generally the lowest of the three except in the case of the American Stock Exchange which posted three successively higher peaks during the period. All three in- dicators recovered sharply, to the end of January and then backed off, reaching lows on February 7th, from which level they have since rallied. The February low, to date, has held well above October-Dec- ember figures. One activity of the market analyst in an uncertain environment should be an attempt to assess the market's internal vitality. In this task, analysis of the above table is of some assistance. A few conclu- sions are perhaps worth noting. One interesting facet, prevailing in the face of widespread commentary on the demise of leadership by secondary issues, is the surprising action of the Amex Index. It was the only one of the five indica- tors to post a series of higher lows last fall, and its January advance was the strongest, carying it far closer to its September high than was the case with any of the other averages. Although it is not shown in the table, that strength has continued on a short-term basis, with yesterday's close actually exceed- ing the January 26th peak. For this indicator, at least, an uptrend of some significance has resumed. The other four indices show essentially parallel action, and it is worth considering just what breadth behavior paralleling that of the Dow and the S&P may mean. The initial conclusion is that the market is showing less vitality than it did prior to last summer, and this can, indeed, not be gainsaid. For about two years, through mid-1978, the bulk of listed issues had acted considerably better than the widely- followed indicators. It must be recalled, however, that this was highly unusual behavior. An examina- tion of breadth in past upswings suggests that it generally has moved in line with the Dow. It is when breadth and broad indicators such as the Cumulative Index begin to show significantly worse action than high-quality stocks that signs of deterioration become evident. Such has not been the case of late. As noted above, all of the indicators rallied nicely from their bottoms of last fall and have not yet approached those lows in early-February trading. Recent internal action can thus, in our view. be described as a return to normalcy rather than as significant deteriora- tion. Dow-Jones Industrials (1200 p.m.) 827.88 ANTHONY W. TABELL S & P Composite (1200 p. m.) 98.62 DELAFIELD, HARVEY, TAB ELL Cumulative Index (2/15/79) 712.99 AWTrak No statement or e;o;preSlon of opinion or any otner matter herein contolned IS, or IS to be deemed to be, directly or Indirectly, on offer or the sollcltollon of an offer to buy or sell ony security referred to Or mentioned The mailer IS presented merely for Ihe of Ihe subscriber While oNe believe the sources of our Informo- hon to be reliable, we In no woy represent or guarantee the accuracy thereof nor of the statements mode herein Any aclion to be token by Ihe subscriber should be based on hiS own Investlgotlon and Informallan Janney Montgomery Scolt, Inc, as a corporation, and Its office or employees, may now have, or ma)' later take, positions or trades In respect to any securliles mentioned In thiS or any future Issue, and such position may be different from any views now or hereafter epressed In thiS or any other Issue Jonney Montgomery xoll, Inc, which IS registered With Ine SEC os on Investment adVisor, moy give adVice to Its Investment adVisory and othel (;USlomers Independently of any statements mode In thiS or In ony 01 her Issue FuMner Informal Ion on any setunly menlloned herein IS available on request

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Tabell’s Market Letter – February 23, 1979

Tabell’s Market Letter – February 23, 1979

Tabell's Market Letter - February 23, 1979
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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 ' –' — -,.- ..,– . – – – —'- February 23, 1979 … -i – '- It is alw-ays difficult to comment on a stock market that is doin-g and the past few months have provided an almost perfect example of that genre. Since 11th, te Dow 5 from its 1977-78 high of 907.74, it has completed no fewer rune of a magmtude of 4 Or greater, and none of these swings have had any notlceable power,the longest one having been the. 27-day rally from the mid-December lows to the high of January 26. The remainder of the swings have lasted from one to nine- teen trading days before being reversed. Despite all of this movement back and forth how- ever, little has been accomplished in the way of moving prices in either direction, the 'bulk of trading having been contained in the 800-850 range on the Dow. This dreary process has now gone on for no fewer than 112 trading days. The swings involved are listed in the table below. DATE DJ AVERAGE CHANGE NUMBER OF DAYS Sept. 11 1978 907.74 Sept. 20 1978 857.16 Oct. 11 1978 901. 42 Oct. 31 978 792.45 Nov. 11978 827.79 Nov. 14 1978 785.26 Dec. 12 1978 821. 90 Dec. 18 1978 787.51 – – – ., Jan. -26 197-9…..,-.–859.-75 Feb. 71979 816.01 Feb. 21 1979 834.55 – 5.57 5.16 -12.09 4.46 – 5.14 4.67 – 4.18 .- 9.-1-7 – 5.09 2.27 7 15 14 1 9 19 4 27 8 8 Despite the fact that this sort of action has been, to say the least, uninteresting, it does, nonetheless, lend itself to analysis, in that it is somewhat unusual. The market spends the bulk of its time within some sort of recognizable trend, either up or down, and long periods such as the present one in which the major averages fail to post new high or lows of any significance thus tend to present certain unique aspects. One interesting tool which can be used to measure and compare this sort of action goes by the rather awesome name of an absolute momentum index. It consists, simply, of adding up daily percentage change, regardless of direction, over a protracted period, say 100 trading days. Thus, in the past 100 days, the market has accumulated a percentage change on a daily basis of over 100 by moving up and down, despite the fact that, over the same period, the net result of all this activity has been nothing more than to move the Dow down by a little over 3. It is often useful to adjust such an index of absolute momentum by subtracting a correction factor based on the actual amount that the market has moved. In the present instance, of course, this correction factor is relatively small since there has been very little real momentum. The adjusted index, therefore, now finds itself at a relatively high level. This sort of level, when attained in the has, more often than not, held bullish connotations. It has, for example, tended to be attained toward the end of fairly important base-formation periods. A few examples are January-March 1958, October-November 1962, January 1967, June-October 1970, and October 1974-March 1975. It has also tended to reach high levels during pauses in ongoing bull markets, notable instances being in the fall of 1950, January-February 1956, and late 1975. Although similar levels have admittedly prevailed at market tops in the past, they have not done so as often nor with the same consistency as in the present case. Our adjusted index has essentially remained at an abnormally high level ever since Oct- ober of last year. In the past, such an impasse has most often ultimately been resolved by higher prices. Dow-Jones Industrials (1200 p.m.) 825.36 ANTHONY W. TABELL S & P Composite (1200 p.m.) 98.09 DELAFIELD, HARVEY, TAB ELL Cumulative Index (2/22/79) 711.98 No statement or expression of opinion or any other matter herein COntolned IS, or IS to be deemed to be, directly or ,nd,rectlr,' on offer or the sol,c.lol.on of on offer to buy or sell any secvnty referred 10 or menhoned The molter IS presented merely for The converlence of the subscriber Wh, e oNe believe the SOurces of our Informo- han to be relloble, we m no way repres!!nt or guarantee the accuracy thereof nor of the statements mode herem Any actIOn to be laken by the svbscrlber should be based on hiS own mvestlgahon ond .nformatlon Jonney Montgomery Scott, Inc, as a corporation, and Its officers or employees, may now have, or may later toke, posItions or trades In respect to any scvrltles mentioned In thiS or any fvture Issue, and Uen position may be dlffere, from any views now or hereafter eypressed m thu or any other Issue Janney Montgomery Scott, Inc, whICh IS regiStered With the SEC as on mvestment adVisor, may give adVICe to Its Investmenl adVisory and othel customers Independently of any statements mode In It, or In any other Issve Fvrlher Information on any security menltoned herem IS ovoilable on request

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