Viewing Month: March 1982

Tabell’s Market Letter – March 05, 1982

Tabell’s Market Letter – March 05, 1982

Tabell's Market Letter - March 05, 1982
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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 – . w; ;-soe '-ti-s;iC-'last week the p'formana1'-gg2U',,'uii'V,,;rlU,dlu;re8Ii1;;';;';-iflin-tU;;he;SlBiidard—-I– and Poors 500. We have compared prices on September 25, when the S & P average itself reached a low of 112.77 and February 23, when it first penetrated that low at 111.51. It has, of course, moved some- what lower this week. The following table summarizes the performance of each of the component groups, including the average change (unweighted) for the stocks in the group. What is interesting is the excel- lent performance of a fair number of groups. Eliminating takeovers, many areas have demonstrated . 'superior relative strength. A number, such as Drugs, Foods, Soft Drinks, Food Chains, Department Stores, and Electric Utilities are classic defensive issues. In addition, finance-related issues have tended to perform well. We do not think this phenomenon is accidental or temporary. Individual groups that show' above-average relative strength on a downswing also tend to perform well on the next up-cycle. Some analysts have explained the above-average performance of defensive issues in terms of their low volatility. In our view, this explanation is only partially satisfactory, and we think there is a strong likelihood that many of these issues mav be leaders in the next bull market. STOC,S STOC,S AVERAGE STOC,S STOC,S AVERAGE ——G-R-O-U-P———————– Uf !oWN CHANGE .—— —— ——- GROUP ——————————— UP —— DOWN —— CHANGE ——- SUGAR REFINERS RESTAURANTS HOSPITAL SUPPLIES EN1ERTAINMENT ELECTRONICS-INSTRUMENTATION TOYS lEISURE TIME SOAPS 0' 00 ',0 1 37.1 COSMETICS 4 1 33.6 ELECTRICAL HOUSEHOLD APPLIANCE 6 o a.; PUBLISHING (NEWSPAPERS) ') o 27.26 OFFICE & BUS. EQUIP. 3 1 5.89 TIRES! RUBBER 2 I n.08 AEROSPACE 4 1 3.06 0 TRANSPORTATION , ,-5 o 1;; ;,LLANEOUS 3 3 -0.67 2 -0.67 1 3 -0.80 5 7 -0.93 2 -1.40 4 4 -1. 79 7 13 -1.80 7 13 -2.91 3 5 -3.23 MULTI-lINE INSURANCE 5 o 17.01 CHtMICALS DRUGS 9 3 14.8 AIR TRANSPORT FOODS 18 3 14.64 CHEMICALS-MISC. SOFT I'RINhS FOOD CHAIN 4 1 12.04 GENEF'AL MERCHANDISE CHAINS 6 1 11.81 CONTAINER METAL &GLASS CONTAINER PAPER 11.68 RAILROAD EQUIPMENT RETAIL STORES DEPARTMENT 7 1 11.31 TELEPHONE (XCLIJ An) TEXTILE PRODUCTS 6 1 10.41 ELECTRICAL EQUIPMENT f'FOPERTY-CASUALITY INSURNCE 6 o 10.33 HOME FURNISHINGS ELECTRIC COMPANIES 20 10. MACHINERY INDUSTRIAL/SPECIALTY MOBILE HOMES HOTEL/MOTEL 3 V 10.17 COAL FITUMINOUS I 9.0 NATURAL GAS fIPELlNES POLLUTION CONTROL 3 8,99 AUTO fARTS-ORG. EQUIPMENT TEXTILE APPAREL MFRS. 3 3 8.80 BANh5(QUTSIDE NEW YOR CITY) RADIO BROADCASTERS 5 1 8,58 ROOFING &WALLBOARD PUBLISHING 5 8.3 SHOES LIFE INSURANCE BEVERAGES BREWERS 5 o 8.21 STEEL 2 7.50 OIL WELL EOUIPMENT AND SERVICE COMMUNICAllON EDUJ'/MFRS 2 2 7.09 OIL INTEGRATED INTERNATIONAL TRUCKERS BANKS(NEW YORK CI1Y) 1 6.61 HEATING g PLUMBING 4 5. 04 fHSONAL LOANS FINANCIAL MISCELLANEOUS 1 2 3.55 OIL CRU!,E PRODUCERS TOBACCO ELECTRONIC MAJOR COS, 1 3. 12 FOREST PRODUCTS 1 2 2,83 AUTO TRUC,S ! PARTS CONGLOMERATES AUTO PARTS-AFTER MAR,ET 5 3 2.27 AUTOMOBILE 1 1.81 MACHINERY CONSTRUCTlON-& MAT. H 400 INDUSTRIALS In 208 1.73 OIL INTEGRATE!' DOMESTIC STANDARD ! POORS 500 248 252 1.54 HOME BUILDHIG 40 UTlLlTlES 40 FINANCIAL 16 1.51 COMPUTER SERVICES 15 1.41 NATURAL GA!' DISTRIBUTORS ELECTRONICS (SEMICONDUCTORS/CaMP 2 J.38 FE,'; IUZERS BEVERAGES DISTllLEfS MACHINE HlOLS 1.28 AIR FREIGHT 3 !. 06 AGRICULTURAL MACHINERY RAILROADS RETAIL STORES(DRUG) 4 4 0.88 ALUMINUM 3 1 0.82 METALS MISCELLANEOUS OFFSHORE DRILLING 3 I 0.63 COf'PER CEMENT HOSPITAL MANAGEMENT COMPANIE 0.35 GOLD -0.3 SAVINGS & LOAN COMPANIES 2 1 3 2 2 2 o I 3 I 1 3 I 1 1 1 1 0 1 J 0 0 0 1 1 1 0 0 1 0 0 1 0 0 0 -0 0 -3.52 -3.67 -3.80 3 -4.06 1 -4.31 4 -4.62 4 -4.63 -4.75 5 -5.26 3 -5,43 4 -5.61 5 -5.81 7 -6.16 4 -6.38 3 -6.78 7 -7.13 5 -7.63 5 -7.67 3 -9.12 1 -9.28 4 -9.75 7 -11.70 3 -11.83 4 -12.06 4 -12.20 8 -12.86 2 -13.00 4 -13.14 6 -14.0 4 -14.66 -17.32 4 -19.02 4 -19.77 4 -19.91 3 -25.60 3 -30.03 3 -31.01 Dow-Jones Industrials (1200 p.m.) 809.93 S& P composite (1200 p.m.) 110.01 Cumulative Index (3/4/82) 1043.62 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL ;N0os(tatseme\ntraobr resperceuSn51Y0n of opinion rcferred 10 or any or ment other Ioned matter herein The molter IS cporentaeninleedd IS, or IS to be merely for the deemed to be, convenlenc!) of dHedly or mdlredl , the subscnber Whlre on we offer or the soliCItatIOn of an offer belIeve the sourccs of our mforma bO dO h o e , we n no way represent or guarantee the accuracy thereof nor 01 the statements mude herem Any action to be token by the subscnber should be p!losn orlrde l/rslgln ond IflfOrotlon Janny M'hntgomery ;COII, Inc, as CI corporailon, and Its l)fflcers or employees, may now hOl/e, or may Jater tOKe, dIh n Ih Jpe a any securl les mef'llione m t IS or any uiure Issue, and such )OJllon may b dlfferenJ from any Ylews now or hereoftef e)lpressed m 1S or a y custorners In er 'dsuel 0rney epen ent yo any Montgomery Scott, Inc, statements made In thiS Which or In IS regIstered With the SEC as on ml/estment any other Issue Further Information on any adseVcIusfolrl may give odvlce to mentioned herein liS Inl/estment adVisory IS ol/ollob!e On request and other

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Tabell’s Market Letter – March 12, 1982

Tabell’s Market Letter – March 12, 1982

Tabell's Market Letter - March 12, 1982 page 1
Tabell's Market Letter - March 12, 1982 page 2
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08540 DIVISION OF MEMBER NEW 'VOAK STOCK eXCHANGE INC MEMBER AMeAICAN STOCK eXCHANGE March 12. 1982 The New York Stock Exchange will shortly release monthly figures for February on NYSE firms carryjngcustomers…stockmarginsccountswhich.Bhouldshowacontinuingdec1ine-ln.NXSEmal'gin 1 debt. Since these figures have 'been available''debit balances'of margin 'accollntl'rin aggregate'teriDs have generally moved in the same direction as stock prices but at a more exaggerated rate. The single exception is the period from the 1976 high to the 1978 low on the DJIA. when margin debt increased with minor interruptions to new highs through June. 1981. This correlation with the longterm trend of the market can be clearly seen from the chart on the opposite page. Margin customers of the NYSE member firms reduced their margin debt in January by 970 million to 13.1 billion. the second largest monthly decline in margin debt since the start of the present series in 1965. Sale of stock from margin accounts suggests heavy liquidation. by customers who were unwilling to pay the high cost of holding shares on credit. The sharp drop in stock prices experienced in early January clearly acted as a catalyst in this reduction. On the other hand. the NYSE reported that margin accounts totaled 1.535.000 in January. a record high for the series. Because of the recent correction in the market. coupled with the extraordinarily high cost of broker loans used to finance stock purchases. this total number of margin accounts is indeed remarkable. In the following exhibit we will try to put these figures in perspective by comparing the behavior of margin accounts to margin debt. We have taken the highs and lows of the margin accounts /debt ratio and compared them to corresponding major highs and lows of the DJlA. EXHIBIT I Margin Debt (mil) Accounts (thou) Ratio Date Dow-Jones June. 1968 Hign 6690 940 I4.li5 11729768 985.08 July. 1970 Low 3780 770 20.37 5/26/70 631.16 Dec. 1972 High 7900 750 9.49 1/11/73 1051.70 Dec. 1974 Low 3910 625 15.98 12/6/74 577.60 June. 1981 High 14870 1320 8.88 4/27/81 1024.05 Jan . 1982 Low 13090 1535 11.73 3/8/82 795.47 Froffi'196S'todate 'theange6f -tliis7atioiS2073Thign on July,-l970' an-d794-low ollOctbb-er….- – -1 1978. The ratio tends to be high at major market bottoms (July. 1970 and December. 1974) and low at market tops (December. 1972). The relatively high ratio in June. 1968. a market high. can obvi- ously be attributed to the large amount of speculation in the market. Also. the ratio tends to peak before market highs and after a market low. If these observations are valid. the recent decline in customer margin debt would indicate lower levels in the DJIA. EXHIBIT II Margin Debt (mil) Total Market Value Percentage Date Dow-Jones June. 1968 H!gn 6690 641037 1.043 1i729768 985.08 July. 1970 Low 3780 531077 .712 5126/70 631.16 Dec. 1972 High 7900 872000 .906 1/11173 1051.70 Dec. 1974 Low 3910 511054 .765 12/6/74 577.60 June. 1981 High 14870 1224000 1. 215 4/27/81 1024.05 Jan. 1982 Low 13090 1116000 1.173 3/8/82 795.47 Another way we are able to analyze the customers' stock market debt is to compare it to the total market value of equities listed on the NYSE. From 1965 to date the range of the percentage of margin debt to total NYSE market value has been 1. 53 high on October. 1978 and .597 low on January. 1971. The observations seem to conclude the higher the percentage of margin debt to market value. the higher the averages. and. conversely. the lower the percentage. the lower the averages. From these studies. it is apparent since June. 1981. margin debt has peaked out coincident with highs reached early in 1981. This is the lowest level to date margin debt has reached since October. 1980. If we accept the premise that increased margin debt feeds a bull market. we must be willing to accept the opposite to be true. The gradual erosion that has been experienced since June. 1981 could pick up momentum and put further. downside pressure on.the market. This, be- comes particularly significant when we examine the number of customers carrying margin accounts under 40 equity. This figure currently totals 12 of total margin accounts. but more importantly. an alarming 37 of total margin debt. a figure in excess of 4.8 billion. In simplest terms. this means the quality of credit continues to deteriorate with 37 of the debt in accounts in the lowest equity class. It should be remembered that in August-September. 1974 this ratio reached a high of 23. a series record representing 58 of total margin debt and was thought to be a major contribu- tor to the decline in late 1974. Although it is difficult to predict how low the level of margin debt could reach. we can identify the establishment of a recent downward trend in margin debt itself. Until this trend is reversed. it would seem difficult to argue against eontinued downside' pressure on the general market. RJSrs ROBERT J. SIMPKINS. JR. DELAFIELD. HARVEY. TABELL Dow-Jones Industrials (1200 p.m.) 798.99 S P Composite (1200 p.m.) 108.39 Cumulative Index (3/11/82 1030.86 No stotement or eltpresslon of opInion or any other matler here'n COfltomed IS, or IS 10 be deemed 10 be, directly or ,nd.reclly, On offer or the sol1Cllollon of on offer to buy Or ,ell ony security referred 10 or mentioned The motter I presented merely for the convenience of Ihe subscriber While c believe the OtJrccs of our Informa- hon 10 be reliable, we In no way represent or guarantee Ihe accuracy thereof nor of The statements mude herem Any action to be loken by Ihe subCnber should be bosed On hiS o.vn Inveshgol,on and Information Janney Montgomery Scott, Inc, as a corporation, ond Its of/lcers or employC!es, may now have, or may later lake, positions or trades In respeCT to any SeCUflties mentioned In thiS or any future Issue, and such p051hon may be different from any views now or hereafter e,.;pressed In rhl!; or any other Issue Janney Montgomery Scott, Jnc, which 1 registered wlJh the SEC os on Investment odvlsor, moy give adVICe 10 liS Investment odll150ry ond othlll C\lslomer Independently of any stotements made In thiS Of In any other Issue Further mformOllan on any security rnenhoned herein IS ovallable on requesl a- ,, 0 – z(f) 0 '…. —1 –I , ' CD , .- . ICD w 0 z L'l crc- 1)nn 'I ,I, 1 Inf) 1 \ 1001 900 1 / Vvv800 NJ 1\ ,Ir r7nn I I f I I v\ V ; i , fJVv I I , 6nn 1c; 1l I 11 1) 11 1n I, ,, l I I \ I i, , I DJIR 11 II ! j . j \ IVv I! I ! 9- \ V ,I 8- I 1\ 7I 6 5 I I , !I – 4 !\t- ,, NYSE ,- i I I, I I' 3 1968 1969 ;, , 1970 1971 1972 1973 1974 1975 1976 RRGIN DET 1977 1978 'I 1979 11980 120G f- liDO – 1000 f- gOG f- 8GO 700 V. 600 IS 14 13 12 11 – 10 9 -8 f- 7 f- 6 f- 5 f- 4 3 1981 1982

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Tabell’s Market Letter – March 19, 1982

Tabell’s Market Letter – March 19, 1982

Tabell's Market Letter - March 19, 1982
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW VORK STOCK EXCHANoe, INC MEMBER AMERICAN STOCK EXCHANGE March 19, 1982 Regular readers of this letter are aware that it is our practice to follow the action of major market indices, in .terms.of.computed trend-channels.hesechannels aresimilarto the '!,eyeball -.,. trend lines drawn by technicians for years, but they have the additional virtue'of-being correct mathematical descriptions of past market history. In and of themselves, of course, such channels are simply descriptive, having no intrinsic predictive value. They do, however, possess the virtue of allowing the analyst to determine whether market action at any given time is consistent with that exhibited by past trends, thus allowing a judgement as to whether such trends may still be in effect. We plot these trends from past recognized high points to low points (or vice versa), usually trying to identify a major, an intermediate, and a minor trend. In the case of the Dow it seems obvious that the last major high was 1024.05 on April 27, 1981 and the last intermediate high on December 4, 1981 at 892.69. The last minor high may be taken to have occured on January 29 at 871.10. The low for all three trends was 795.47, reached on March 8. The following chart shows all three trend channels, with the Dow shown daily through this Thursday and the trend channels ..2!otted forward until early next Fall. DOW JONES INDUSTRIRL RVERRGE WITH COMPUTED TREND IRRED B( OELRI!LD, I-!P'!VE'!', TfI!!ElL The steepest trend, as is usually the case, is the minor trend from January. If this trend remains in effect, it can be projected forward to intersect the low point of the major trend channel at around 720 in late April-early May. This would be a logical juncture to look for a bottom to occur. If, on the other hand, the minor trend is broken, something that could occur with continu,ance of the recent strength, and the upper level of the intermediate channel, now around the 820 level, holds, the eventual bottom would have to be projected out further in time to a level just under 700 some time in September. Of course, the breaking of either or both trend channels on the upside could suggest that an attempt at a bottom was taking place at a higher level prepatory to an eventual assault on the upper limit of the major downtrend, which is now at approximately the 855 level. With the timing about right for the end of a major-cycle downphase, trend analysis may well be of some aid in pinpointing just when that phase may have reached its low. AWTr Dow-Jones Industrials (1200 p.m.) 804.03 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL S & P Composite (1200 p.m.) 110.37 CttfIltHate illi'lex (a 118182 1948.68 . No !.totement or exprenlon of Opinion or ony other matter herem contamed Is, or 1510 be deemed to be, dlrectlycr-indlreCtly, on offer or the solicltotlon of on offer to buy or sell ony se,urlly referred to or menhoned The motter 1 presented merely for the convenient! of tneSubscr,ber WhIle -He belIeve the Ources of our Informa hon to be reliable, we In no way represent or guarantee the accuracy thereof nor of the s'otements mude herein Any action to be tolen by the subscriber should be based on hIS own Investigation and Information Janney Montgomery Scoll, Inc, as a corporation, and Its officers or employees, moy now have, or may later take, positions or trades In respect to any secUflhes mentioned In this or any future !ssue, and such posillon moy be d,fferent from any views now or hereafter expreued In thiS or any other issue Janney Montgomery Scoll, Inc, whICh IS registered wilh the SEC as on Investment adVisor, mav give advlCc to Its Investment adVISOry and othel customers Independently of any statements mode In thiS or In ony other Issue. further ,nformatlon on any secuflly mentioned herCln IS avaIlable on request

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Tabell’s Market Letter – March 26, 1982

Tabell’s Market Letter – March 26, 1982

Tabell's Market Letter - March 26, 1982
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON. NEW JERSEY 08!S40 DIVISION OF MEMSEA NEW VORK STOCK EXCHANGE. INC MEM8ER AMERICAN STOCK EXCHANGE r– March 26, 1982 – I f -market-action-in-March -has-done-nothingelse, -i-t-has – at .Ieast createdA a-new-benchmarkdate That date, it can'now be recognized some three weeks 'after the fact, is 'II-larch' 8;-ori-which the Dow Jones Industrial Average closed at 795.47. At that level, the Dow, along with most other indicators, had decisively broken its prior low of last September and had reached a new nadir for the ll-month old downswing from the highs of April, 1981. All of this is not simply the technicians' oblique way of painting out that the market has rallied over the past three weeks, Indeed it has, and at Thursday's close, the Dow found itself up just over 4 from its March 8 low, Establishing that March 8 low as a benchmark, however, reqmres recognition of the fact that in many ways, market action since that date has been demorstrably better than the rather dreary sort of behavior which characterized most of last year. Using a 2 filter, the action of the past three weeks constitutes only the ninth identifiable rally since the beginning of the downswing, back on April 27, 1981. In terms of percentage advance. it has, so far, demonstrated nothing better than normal action. The swings for the eight completed rallies to date have averaged 4,2, and the strongest was the 6.5 rally from the September 25 low. In terms of staying power, however, the present advance is fairly impressive. Through Thursday's close, it has lasted for 13 trading days. The first bear-market rally back in May-June 1981 persisted for 24 days, but since that time tre market has been able to put on nothing better than an ll-day advance. It is, in sum, possible to detect substantive improvement in recent action. There are, indeed, other areas beyond simple measurement of rallies in which improving market action can be detected, Many individual issues have reached at least initial downside objectives and, in many cases, appear to be making attempts at base formations in recent trading. This sort of thing is reflected in the new-low statistics which, at least for the last downside phase, are a matter of record. Despite the fact that almost all major market mdices moved into new low territory early .this,month, .the.peak.number of individual stock lows achieved on March 9 was '263, considerably under the peak levels of aimost-60'Iich9.Kea-upbacKiTlsepteriiber. we'tio nol-UrtrrJrirn-misremiing– of the facts to call this a sign of technical improvement, at least in large sectors of the market. A number of signs of improving technical action are, of course, conspicuous by their failure to materialize. Breadth (the best advancing day so far featured 1210 advances on March 22) has been consistently less than impressive. Nor, despite the fact trading activity has picked up on the upside, is it possible to read too much comfort mto volume statistics. Volume reversal action, as we have pointed out, generalt'consists of a series of sharp one-day trading expansions to well above normal levels. What has instead been taking place is a steady expansion in the average level of volume which, on a 2S-day basis, has now reached over 57 million shares, by far its highest level on record. This high average level of volume will make it even harder for a conventional upside volume reversal to be recognized. Where does all this leave us In many ways the average investor can best obtain the answer by a process of self-examination — in other words by asking himself how the current improving market action makes him feel. The most bullish conventional wisdom at the moment would be the widespread certainty that the present rally constitutes a selling opportunity and it is only a matter of time before the market moves once again to new lows. On the other hand, to the extent that the current advance causes investors to feel that they have missed a major hottom, it becomes more and more likely that such a bottom has not yet occured. We are willing, for the time being, to remain neutral on the subject, which is why we went no further in our opening paragraph than identifying March 8, 1982 as a benchmark to watch. While recognIzing improvement — and indeed, as we have tried to point out, improvement of some signi- ficance in the past three weeks of trading — we think it grossly optimistic to suggest that improve- ment is dramatic enough to indicate the end of a confirmed ll-month downtrend. Moreover, while recognizing the possibility of further strength, we suspect. tl'!.at the least likely eventuality at the present time is for the market to run away on the upside. What we are saying, in other words, is that the technical picture has not been drastically altered by just three weeks of mildly amelior- ated action. Insofar as the pattern for the averages is concerned, the Dow has now moved up to the trading range, roughly between 820 and 840, which characterized most of February. The most constructive possible action, we think, would be a relatively protracted (2-3 week) period of backing and filling within that range. Were this to be followed hy a decisive move through 840, upside possibilitles would then have to be reassessed. For the time being, we are willing to await the formatIOn of this sort of pattern. ANTHONY W. TAB ELL AWTrs DELAFIELD, HARVEY, TABELL Dow-Jones Industrials (1200 p.m.) 822.01 S & P Composite (1200 p.m.) 112.40 Cumulative Index (March 25, 1982) 1078.12 oe,No sfatemen! Of expreSSion of opmlon or any other matler herein contOlned '5, or IS to be deemed fa direCTly or indirectly, on oUer or the sol,eltatlon of on offer 10 buy or sell any seC\Jr11y referred 10 or mentioned The mOiler IS presented merely for the convenience of the subscriber While Ne believe the sours of our Information to be reliable, we 'n no way represent or guarantee the cccurocy thereof nor of the stateMents mude herem Any oeilon to be tolen by Ihe subSCriber should be bosed on hiS own ,nvestlgotlon and ,nformation Janney Montgomery Secll. Inc, as ( corporation, olld Its officers I)r employees, may now have, or may later toke, positions or trade! In respect to any securltlet menttoned In thiS or any future luue, 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 tis Investment adVisory and olhe! customers tndependently of any statements mode In Ihls or ' any OTher usue Further informaTion on any secvrlty mentioned herein IS aVOIloble on request

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