Tabell’s Market Letter – March 20, 1981

TABELL'S MARKET LETTER 909 STATE AOAD, PRINCETON. NEW JERSEY 08540 DIVIBION OF' MEM6ER NEW YORK STOCK EXCHANGE INC MEMBER AMERICAN STOCK eXCHA.NGE March 20, 1981 –!'- – …-…….s. –,,.. – k-. '- . — – – 0- .. – ;;-;;.;;-;;'t;'-11-1 The Dow-Jones Industrial Average's latest flirtation wIth the 1000 level set uS to doing- some this week. The venerable indicator first touched 1000 some 15 years ago in January. 1956. Since we have spent some 27 years In the securitIes business. this means that something more than half of our career has been spent witnessing periodic occurrences of this phenomenon. We were. thus. inspired to collect the figures below. 1966 is so far back in ancient history that computerized data bases do not cover it, but we have shown. in the table below, the closIng price of each of the DJIA TS components for selected dates starting with Dec- ember 3, 196B. the second occasion on which the Dow approached the 1000 mark. (It should be noted that IBM and Merck were not in the Dow for most of the period shown. All prices have been adjusted for stock splits.) Following the 1968 rise, the Dow then reached what is, to date, Its all-time high at 1051. 70 on January 11, 1973. 1t spent much of 1976 at or above the 1000 level with the high being reached at 1014.79 on September 21. The last three columns of the table show the Dow's most recent three attempts at four digits, November 20, 1980 at 1000.17, January 6, 1981 at 1004.69, and March 16, 1981 at 1002.79. Company Name 121 3168 1/11/73 9121/76 11/20/80 11 6/81 3/16/81 Alhed Chemical Corp. Aluminum Company America AmerlCan Brands, Inc. American Can Co. AmerIcan Tel & Tel Bethlehem Steel Corp. duPont Eastman Kodak Exxon Corp. General Electric Co. 37-1/4 24-7/8 35-3/4 58-3/8 55-1/4 28-7/8 58 78-3/4 41-1/2 49-318 30-1/8 19-7/8 45 32-3/8 54-5/8 29-112 61-1/2 147-3/4 45-5/8 73-5/8 40-1/4 29-1/2 42-5/8 36-1/8 62-1/8 42-1/8 44 93-518 56-7/8 55-3/4 60 3/4 33-5/8 76-1/2 30-3/8 47-1/2 28-1/4 43-1/4 74-1/4 87-1/2 61-1/2 55 31-1/8 80-1/4 32 50-3/8 26-7/8 44-3/8 75-1/2 80-1/2 64-1/2 56 112 36 73-314 29-7/8 52 29-3/4 51-7/8 82 70-3/4 68-1/2 General Foods Corp. eneralSJvlotors .-' – , – ,c–. 43-7/8 29-112 33-3/4 29-518 30-7/8 34 8 3 1 . 1 2 – 8 3 ' 73 -..;c –46-1-/1349–05i-'lHJ,o;o,-I,,,.-1 Goodyear Tire & Rubber Inco Ltd. InternatIonal Business Mach. International Harvester International Paper Co. Johns Manville Corp Merck & Co. Minnesota Mimng & Mfg. Owens Ill. Inc. Proctor & Gamble Co. Sears Roebuck & Co, Standard Oil of California Texaco Inc. Union Carbide Corp. United States Steel Corp. United Technologies Corp. Westinghouse Electric Woolworth Co. 30-3/8 37-1/4 66 36-7/8 39-114 40-1/8 44-3/8 56 39-112 48-1/8 33-3/8 17-3/8 44-1/2 48-7/8 29-1/8 36-1/8 37-1/2 34 30-3/4 36-1/8 83 37-1/8 41-7/8 29-518 98-3/8 88 21 114-3/4 60-3/4 21-1/8 39-5/8 50-3/8 22-1/2 22 46-1/4 30-1/4 24-1/4 17-7/8 35-112 22-1/8 72 72 31 28 71-318 42-1/4 30 25 80-3/8 80 66 60-1/2 29-1/8 27-1/2 95-7/8 73-1/8 35 16-1/8 19-318 51-7/8 29-518 49-1/4 65-1/8 52 51-1/4 24-3/4 34-5/8' 61-1/4 18-7/8 32-1/4 24-5/8 24 18-1/4 21-3/4 71-112 25-7/8 44-5/8 26 85-3/4 63-1/8 26-1/2 71 16-5/8 49-318 47-1/4 54-5/8 25-7/8 65 31-7/8 25- 3/8 18-3/4 22-1/8 64-5/8 19-5/8 51 24-1/8 85 62-3/8 29-3/4 74-1/8 17- 3/8 42-3/8 38-1/2 59-1/8 32-3/4 56-1/4 31 25-3/4 Taking the entire period December, 1968 through March, 1981 shows that the five best-acting stocks were Standard Oil of CalIfornia (143). American Brands (106), Merck (92), Exxon (70), and United Tech- nologies (56). An equal investment in these five companies would have produced a 90 gain over the 12year period. The worst-performing components were American Can (-49), Sears Roebuck (-48). International Harvester (-47), Inco (-41), and Johns Manville (-40). An investment in these five would have shown a 45 loss. Over the 12 years. those stocks advancing and declining are divided evenly with 15 stocks up from their1968 figure, as of last Monday, and 15 others down. A short-term comparison comparing MondayTs prices witli. those of January 6also has its interesting facets. ever the two-month period involved J 16 of the components have advanced and 14 have declined. The basic reason that the Dow remams below its January highs lies in the action of International Harvester plus the three oil components of the average. An equal investment in the Dow components. leaving out these four issues, would have produced a 4.1 gain over the last six weeks, The diversity of action, if nothing else, puts a fine point on some of the sermons we have recently been delivering in this space on the subject of securIty selection. As the table quite clearly shows, though the average itself may have made no progress over the past 12 years. the action of the individual components has been widely varied, and. in some cases. quite dynamic. ANTHONY W. TABELL Dow-Jones Industrials (12 00 PM) 991. 71 DELAFIELD, HARVEY, TAB ELL S & P Composite (12 00 PM) 133.77 Cumulative Index (3/19/81) 1104.60 AWT sla No statement or expression of opmlOn or any other motler herein contOined IS, or IS to be deemed to be directly or indirectly, on offer or the solicitation of on offer 10 buy or sell any security referred to or menTioned The matter IS presented merely for the convellence of the subscriber While He believe the sources of our Informo tlon to be rellClble, we In no way represent or guarantee the accuracy thereof nor of the staTements mude herein Any actIOn to be loken by the subSCriber should be based on hiS own investigation and Information Janney Montgomery Scott, Inc, as a corporation, and Its officers or employees, may now have, or may later toke, POSitiOnS or trodes In respect to oily securities mentioned In thiS or any future Issue, and such POSition may be different from ony views now or hereafter expressed In thiS or on)' other Issue Janney Montgomery Scort, Inc, which IS reg,stered wah the SEC as on investment adVISor, may give adVice to Its ,vestment adVISOry and othel customers Independently of ony sTotements mode In thiS or In any other Issue Further Information on any security menTioned herein IS available on request