Viewing Month: July 1983

Tabell’s Market Letter – July 01, 1983

Tabell’s Market Letter – July 01, 1983

Tabell's Market Letter - July 01, 1983
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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 . July I, 1983 Two days ofratner sharp d.rclin 02 -an020pom1S)Ci't'lMOflclay andTuesaay. oftm.;s-week,;—–l brought the Dow-Jones Industrial Average to a closing low of 1209.23. This drop was followed by two days of a rather tepid rally. Thus, all of ten trading days have now occurred since the major averages attained newall-time highs. Volume contracted sharply on the correction and, on Monday, was at its lowest level since April, barely half its recent peaks. Once more, as we have done repeatedly over the past ten months, it may make sense to put what has happened to date into perspective. The total drop so far has been 3.13 on the Dow- Jones Industrial Average, making this the ninth correction of greater than 3 that has been experi- enced since the bull market began. It is the third similar decline that has occurred in the past month so far, the first reaching a bottom on May 20 at 1190 and the second on June 8 at 1185. The possibility remains, therefore, that the entire process which the market has been undergoing since May 6, when the Dow reached a high at 1232 after a 15-week uninterrupted advance, cor.3ti- tutes a single formation, either a lateral corrective phase or a distributional top, especially in light of the lack of vigor following the June 16 new high. We confess that we are loath, at this point, to accept the latter interpretation. Individual stock formations, although they have deteriorated somewhat from the uniformly bullish configurations present early this spring, still do not suggest the possibility of an intermediate-scale decline. Nor, in our view, do most momentum indicators, one of which we will be discussing below. Nonetheless, a decisive break below the 1185 level, however unlikely it may be, would have to be regarded with some seriousness. If nothing else, the week's weakness made life easier for those who are responsible for compos- ing the next-to-last page of the Wall Street Journal. On Wednesday, only 27. issues reached new – 52-weekJtighs..—.1bis in sharp….contrast to.-early-May-s..leyeLof oyer ZOJLlmd.the astounding record figure of 653 on October 11 of last year. ,The question is what does such a figure, amounting to- only 1. 4 of all issues traded on that day, actually mean To begin with, the 27 new highs achieved are not even the lowest level of the bull market. (That figure was 25 on January 24.) To be meaningfUl, the number of new highs must be expres- sed as a percentage of issues traded and then, to smooth out fluctuations, averaged over some time period. For the 10 days ended Wednesday, the average number of new highs as percentage of issues traded was 7.41. It should decrease further as some recent, fairly ebullient advancing days are removed from the average. The 7.4 figure, in turn, is well off the lowest level of the current bull market, which is 3.73 for the ten days ended February 2. Moreover, by the standards of past bull markets, it must be adjudged as a rather decent level. Until the current upswing, a 10-day average of 10 or 11 of all issues traded advancing generally constituted the peak level for an entire cycle. The current advance has thus set new standards in this area as well. Indeed, in the five bull markets previous to this one, those beginning in 1962, 1966, 1970, 1974, and 1978, an almost total drying-up of new highs was a fairly common occurrence. All of these upswings saw periods in which the 10-day average of new highs as a percentage of issues traded moved below 1. This occurred repeatedly, not only well before the Ultimate market high, but long before a major portion of the total advance had been completed. By contrast, we have not, since last August, seen any single day on which 1 of issues traded failed to make new highs, let alone a string of days which would bring a 10-day average below that level. Likewise there occurred, on Tuesday, only 13 new lows anl, as of Wednesday, the 10-day aver- age of daily new lows wasonly 0.28. Based on the historical record, it would be not unusual to see this figure move to at least a 2- 3 level before it could be said that any significant deterioration had. occurred. This, of course, it is nowhere near doing. The new-high and new-low figures, then, are just another item in a host of indicators that stubbornly refuse to show any loss of even intermediate-term momentum. Under these conditions, a correction a great deal more serious than that seen so far appears unlikely. AWT rs ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Dow-Jones Industrials (12 00 p.m.) S 8. P Composite (12 00 p.m.) Cumulative Index (6/30/83) 1221. 35 167.90 2003.31 No slatement or expreulon of opmlon or any other motler heft' In contOlned IS, or IS to be deemed 10 be, directly or indirectly, on offer or the Ollcltotlon of on offer 10 buy or sell ony security referred 10 or mentioned The motler 15 presented merely for the convenience of the subscriber While tJ believe Ihe SOlJrccs of OlJr Information 10 be reliable, we In no way represent or guarantee The accuracy thereof nor of the Slalements mude herein Any action to be ,aken by the subscriber should be based on hiS own Inveshgatlon and Informalion Janney Montgomery Scott, Inc, as a corporation, and In officers or employees, may now have, or may 10ler toke. poslt/ons or trades In respect to any SCiurllles mentioned In Ihls or any future ISUe, and such position may be different from any views now or hereafter e1pressed In thl or any other ISsue Janney Montgomery Scali, Inc, which IS registered WIth the SEC as en Investment advisor, may give adVice to Its Investment adVISOry and othel CUSlomea Independently of any statements mode In thIS or In any other Issue Funher InformatIOn on any seo.trlly mentioned herein IS available on request

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Tabell’s Market Letter – July 08, 1983

Tabell’s Market Letter – July 08, 1983

Tabell's Market Letter - July 08, 1983
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TABELL'S MARKET LETTER 909 STATE ROAC, PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YORK STOCK EXCHANGE. INC. MEMBER AMERICAN STOCK EXCHANGE July 8, 1983 The artisan's tools are determined, to a great extent, by the environment in which he is operat- -ing .An,.-ax…is…an.Jnappropriate ,tool.forasurgeon, as.isar.foraJumber;jack,,Tllisreflectionis prompted by -what we see as -a major difficulty in forecasting the current 'stocK market. -Uncertainty as to the nature of the basic market environment makes the choice of forecasting tools hazardous at best. During our own investment career, we have observed two separate and distinct long-range market environments. The first of these began around the end of the Second World War and came to an end sometime In the middle 1960's. The second took over at that point, and (we think) will come to be knOMl as having ended during a period centered on the watershed date of August 12, 1982. (A third, and still different, market environment prevailed during the 1930's, but that will not be the subject of dis- cussion here.) The two environments which we have experienced at first hand had certain similarities. Both – were characterized by major bull and bear-market cycles, and both retained the familiar, approximately four-year periodicity of these cycles, which has been traced back to the 18th century. At that point, however, the similarity ceases. The 1950's and 1960's were characterized by significantly higher peaks and valleys attained for each successive cycle. Moreover, the cycles tended to spend most of their life- time in an advancmlr phase followed by short, sharp bear markets. Furthermore, corrections during th, upward phase of each market cycle, in the early stages at least, tended to be relatively small and insig- nificant. We cited in a recent letter the eight-year period between 1949 and 1957 when no correction ever exceeded 13. The middle 1960's to date, of course, have featured cycles in which the peaks and valleys were at approximately the same level. The individual cycles spent more of their length in a declining phase, and corrections within advancing phases tended to be frequent and often deep. Our readers will recall our thesis that the recent advance to the mid-1200's on the Dow is totally inconsistent with that sort of 9llvironment, and our resultant conclusion that the basic stock-market background for the 1980's — and probably the 1990's — will be quite different from that of the late 1960's and 1970's. I-I—–'-hetrouble-is-,—f-cour-Be,—that-,less-than….year…mt-'-Priod—probably-to be measul'ed-in-dee——I—I ades ,-we have only the fuzziest sort of idea of what this new era will be like. It will presumably possess more of an upward bias, cycle-to-cycle, than did the one just ended, -and we recently have been citing the 1950's as an example of what can happen In the framework of a market with a basic upward biss., There is, however, no resson to assume that that bias (which in the 1950's constituted a secular uptrend 'at around a 9 annual rate) will be duplicated In the years to come. The upward bias could be less thart that bf the 1950's or, indeed, greater. There is no way of guessing based on the evidence now availabl4. , There is, likewise, no way,of knowing how long the cycles of the new environment will tend to spend in their advancing phase or-the general nature of bull-market corrections. The first bull market of the new environment has seen precious little in the way of corrections so far, but this is limited ex- perience on which to base a judgment. Now all of this long-term theorizing, it seems to us, is not irrelevant to the problems of near-ter forecasting. It is an incontrovertable fa9t, for example, thst many technical forecasting tools (Member Shorr Sales are as good an exmnp!eli any)' are suggesting the imminence of a correction of some signifi- ,cance. The problem is that the accuraCy of many of these tools is predicated on the experience of the 1960's and 1970's. Whether they will prove equally accurate in the future is, at least, open -to doutit. Indeed, many of the finely honed tools of the last decade have been suggesting corrections at various 'points during the last 11 months, corrections which, as we know, have failed to materialize. The same principle applies to determining what external factors are most likely to be the cause of short-term market movements. Just this week, for example, we have witnessed price weakness engend- ered by forecasts of higher Interest rates. In this area, st least, the market seems to remain sensitive to the same sorts of stimuli that moved it in the 1970's. We are not sure, however, how long this will continue- to be the case. The background interest-rate picture is, st this time, Significantly different – than it was, say, a decade ago. It would therefore not be surprising to see the stock market begin to 'develop the ability to ignore minor blips in money rates. ..- It is for this reason that we hsve chosen — so far at least — to retain a relatively sanguine attitude toward the loss of momentum which has taken place since early May. Further deterioration (in- cluding as we suggested last week a decisive bresk through the 1l85' level) would drag us Into the camp 'of thOle who are concerned about Significant action on the downside. For the time being, however, we tend to retain a healthy skepticism about the use of the lsst decade's tools in what seems obviously a very different sort of market. AWTrs ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL ,Dow-Jones Industrials (1200 p.m.) 1209.44 'S P Composite (1200 p.m.) 167.66 Cumulstive Index (7/7/83) 2007.93 No statement or expreulon of opinion or any other motlC!r herein contained IS, ar 15 10 be deemed to be, directly ar ondlfeclly, on affer ar the SalKltolion of on offer to. buy or sell ony security referred to ar mentioned The mailer IS presented merely for the convenience af the subscriber While '/Ole believe the sources ef eur information to. be reHoble, we In no way represent ar guarantee the accuracy Ihereof nor of the statements mude herein Any oelion 10 be taen by Ihe SUbscflber should be based en hiS awn investlgallon and Infermotlon Janney Menlgomery 50.11, Inc, as a carperatlon, and lis officers or employees, may now have, Of may laler toke, pellhons or trades In respect to any sectJfllles menlloned In Ihls or any future Issue, and such pOSlllon ITI(lY be different from any views now or hereafter expressed In thiS or any other ISsue Jonney Montgamery Scolt, Inc, which 1 registered With the SEC as on inJcstment advlsar, may give adVice 10 Its Investment advlsary and othel customers Independently af any statements mode In Ihls or In any other Issue Further information on any security mentioned herein IS avodoble on request

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Tabell’s Market Letter – July 15, 1983

Tabell’s Market Letter – July 15, 1983

Tabell's Market Letter - July 15, 1983
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TABELL'S MARKET LETTER 909 STATE ROAD. PRINCETON. NEW JERSEY 08540 DIVISION OF MEMBER NEW YOAK STOCK eXCHANGE, INC MEMBER AMERICAN STOCK EXCHANGE – July 15, 1983 The Dow-Jones Industrial Average plunged once more below the 1200 level at mid-week, thus markin-g the tenth successive week in which the market has been able to make little upside progress. Tlleeffectiv.eatarLoL.this…period..m uatJlOw–be..fixedas…May6.J 9.83whenthe-D.ow closed at I 1232. 59- followig 'a essentiallY u;'inte;rupted advance- of over 200 points 'since January – -Although the May 6 close was bettered slightly at 1248.30 in mid June, the entire ten week period now ap- pears as a sideways trading range. It has seen three corrections, in the 31-4 range, each one producing a low slightly below the 1200 level and (two to date) short-term rallies. As the period wore on, there emerged more and more forebodings from various quarters that the ten-week period might prove the precursor of something more serious, perhaps the first serious downside move since the bull market began last August. This may indeed be so, but, as our readers are aware, we have, so far, resisted the urge to state that such is definitely the case. We have cited as one of the reasons for our relative optimism the continued favorable picture shown by individual stock patterns. That picture is reinforced by a computer study we conducted this week analyzing the trading history since May 6 of 1893 individual issues, including most NYSE commons plus major ASE and OTC issues. This study reinforces the impression that, despite the rather desultory action of the averages, the market has not acted all that badly over the past ten weeks. Perhaps the best evidence for this is the continued stream of issues posting new highs each week despite the fact that the aver- ages were moving sideways. The following table shows the number of issues which attained their high for the May 6-July 13 period in each of the ten weeks. Also shown are the closing high and low for the Dow-Jones and its change for the week. Issues Making Dow-Jones Industrial Average Dates High for Period 95 High – Low – Close 1232.59 Points Change — 5/9-5/13 204 1229.68 1214.40 1218.75 – – 5/i66/20 85 1205.79 1190.02 1190.02 -13.84 -28.73 5/23-5/27 157 1229.01 1200.56 1216.14 26.12 5/31-6/3 75 1213.04 1199.88 1213.04 – 3.10 6/6-6110 103 1214.24 1185.50 1196.11 -16.93 6/13-6/17 264 1248.30 1220.35 1242.19 46.08 6/20-6/24 352 1247.40 1239.18 1241.69 – 0.50 6/27-7/1 178 1229.47 1221.96 1225.26 -16.43 7/5-7/8 174 1220.65 1207.23 1207.23 -18.03 7/11-7/13 206 1215.44 1197.82 1197.82 – 9.41 The even dispersal of issues attaining their peaks is a rather interesting phenomenon. Per- haps most interesting is the final line, which shows the action for the first three days of this week. Despite the new low posted by the Dow, it was the third best week of the ten in terms of issues attaining their highs for the period. It will indeed probably turn out to be considerably better than that, since the study does not include Thursday's and Friday's trading, the former, at least, being an up day. The study strongly 'suggests that the period has been one, to use a tired phrase, of rotating leadership. At some time during the ten weeks, most issues have undergone corrections of more than passing significance. The average correction, measured from the high for the period to its subsequent low, is 13.13, and the median correction -11.9. 631 issues have undergone correctil'ns of 15 or mope at somE Rtage of the proceedings. Nonetheless, despite the fact the Dow was some 35 points lower at Wednesday's close than it was on May 6, more stocks are higher today than are lower. 815 issues closed on Wednesday below their May 6 high, – and 32 are unchanged, but 1046 -issues were higher at mid-week than was the case in May. The average change for all issues over the period isa 4. 09 gain, with the median stock being up 1. 94. It does not appear, therefore, that, based on simple price action, the loss of momentum over the past ten weeks has been as serious as some of the more esoteric technical indi- cators might lead us to believe. AWT rs ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p.m.' Cumulative Index (7/14/83) 1196.01 165.18 2003.58 No talement or expression of opinion or any other motter herein contolned fS, or IS 10 be deemed fa be, directly or mdHcctlr,' on offer or the SOIICllat,on of on offer to buy or sell any security referred to or mentioned The molter IS presented merely for the conveOlen of the subscriber Whl e we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the stalements mude hereon Any 0(110n to be token by the subscriber should be bosed on hiS own investigation and information Jenney Montgomery Scott, Inc, as a corporohon, and Its officers or employees, may now have, ar may later toke, POltiOns or trodes In respect 10 any securilles mentioned In thiS or any future lSue, and such pesltlon may be different from any views now or hereafter expressed In thiS or any other ISlue Janney Montgomery Scott, Inc, which IS registered wllh the SEC as on Investment adVisor, may give adVICe 10 lIs Investment adVisory and othel C'Vstomers Independently of any stolements mede In Ihls or In any other Issue Further information on eny securdy mentioned herein IS aVailable on request

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Tabell’s Market Letter – July 22, 1983

Tabell’s Market Letter – July 22, 1983

Tabell's Market Letter - July 22, 1983
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TABELL'S MARKET LETTER 909 STATE ROAD, PRINCETON, NEW JERSEY 08S4Q DIVISION OF MEMBER NEW YORK STOCK EXCHANGe, INC MEMBER AMEFlICAN STOCK EXCHA.NOe July 22, 1983 I-'.''-AS-Qetectivestory-buffsweareiofcourseavii-followers–of..,.the–exiloit.,of4het-famous–…,…..II Nero Wolfe. The corpulent detective was not a ma.n- given to excessive praise. ane!, when one of his assistants had accomplished a particularly spectacular feat, he would tend to utter the single word Satisfactory. Our inclination is to use the same word, in approximately the same spirit, regarding this week's performance by the stock market. A week ago, following a 12-point decline, the Dow found itself at 1192.31, and it extended this drop to 1189.90 on Monday. At this level, it found itself flirting with a low in the 1190-1180 range for the third time since last May. This rather conventional triple test signalled its success by a seven-point advance on Tuesday and a rather spectacular 3D-point rise in Wednesday's trading. Wednesday's session was particularly noteworthy from a technical point of view. Volume expanded to 109 million shares after having remained in, essentially, the 60-80 million-share range for the previous four weeks. It constituted only the eighth 100-million-share-plus day in the 52 trading days since May 6th. Seven of these eight days, interestingly enough, featured rising prices. The 1,391 advancing issues constituted the third highest total attained since the bull market began over a year ago, exceecjed only by the initial rally on August 13, 1982. and the start of the second-phase advance in October. As Nero Wolfe might well have said, Satisfactory. This is not to say that we are entirely out of the woods as far as the trading range Which has stalled the market for the last 2 1/2 months is concerned. To the extent that individual issues have formed distributional tops prior to the recent strength, most of them have done little more than rally into existing overhead supply. Indeed, we suspect that the market's inability to fOllow up with any conviction on Thursday is probably reflective of this fact. Short term, we would expect a further slowing of upside progress to take place before the supply is chewed up and the year I 1–f–,–Gldupswingcan-r-eaffirm-isvitaJit.Y-byacllieving-decisi\Ie.enew–highs.——- Our current expectation, of course, is that it is likely to do so. We have tried to suggest in the last couple issues of this letter our feeling that the market's overall vitality was a great deal better than the action of the averages suggested. We pOinted out last week, for example, the fact that a significant number of issues were close to their highs for the 10-week trading range from May to date. In this light, the so-far-successful test of the 1180-1190 low is not surprising. It still, of course, remains possible that the assault on new highs will fail and that what began in May will turn out to be a topping-out process. We have not, however, regarded this as a strong probability in the past, and we think it becomes less probable at the moment. The above discussion has, not unintentionally, focused on a purely technical point of view, without once mentioning either the money supply or interest rates, factors which the whole world, outside of ourselves, seems to believe are the sole determinants of the day-to-day action of the market. Last Friday's decline, we were assured by most analysts, took place due to the five-billion dollar M-1 increase reported last week although, interestingly enough, the actual figures were not released until after Friday's close. Once they became known, the money-supply figures produced little change on Monday. The Wednesday rally was then attributed to Mr. Volcker's assurances that he would not commit ritual murder on the economic recovery. In many ways, we now seem to have arrived at the Paul Volcker stock market, much as, a year ago, we were in the Henry Kaufman stock market. We have the highest admiration for both gentlemen, but there are, it would seem to us, a few factors at work on the stock market besides the latest pronouncements to issue from these particular oracles. We suspect, in other words, that the market's present obsession with interest rates, as with the hundred-or-so other obsessions that have occupied it in the past, may prove transitory. . '. Nonetheless, in light of this obsession, it is perhaps worth noting that 'one of the superstars of the recent stock market has, largely unnoticed, been the staid old public-utility group, which remained almost unaffected by the late weakness and which, as measured by the Dow-Jones Utility Average, moved this week to a new 14-year high. The pattern formed by these interest-sensitive stocks, moreover, seems to have the features of a major base with a possible upside objective of 186 versus a current level of around 132. If this action is to be believed, the market's concern with interest rates may, in fact. be less deep than it appears. AWTj ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL Dow-Jones Industrials (1200 p.m.) S & P Composite (1200 p.m.) Cumulative Index (7/21/83) 1229.57 168.60 2023.32 No slCltl!ment or expression of opinion or any olner motter hercln contolned Is, or IS 10 be deemed to be, dHEctfv or Indirectly, on offar or the SoilCllotlon of on offer to buy or sell ony security referred to or mentioned The matler IS presented merely for the convenlenc 01 the subscriber While we believe the sources of our tnfOrmohon 10 be relloble, we In no way represent or guarantee the accuracy thereof nor of the statements mJde herem Any Ocllon to be loen by the subscriber should be bosed on his own investigation and Informailon Janney Montgomery Scon, Inc, as a corporation, and liS officers or employccs, may now have, or may later take, pOSitions or trades In respect to any seCUrftles mentioned In thiS or any future Issue, and such pos!ilon may be different frOm any views now Or hereafter expressed In thiS or any other luue Janney Montgomery Scott, Inc, which IS reglslered With Ihe SEC as an Investment adVisor, may give adVIce 10 Its Investment adVISOry and olhel CVtomcr rndependently of any statements made rn thiS or rn any other Issue furiher information on any securrty menllaned herein IS avarlable on request

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Tabell’s Market Letter – July 29, 1983

Tabell’s Market Letter – July 29, 1983

Tabell's Market Letter - July 29, 1983
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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 July 29, 1983 We have been pointing out in this space that the bull market environment, ill which we hare been basking at least up until two days ago, seems In many ways to possess a certain simi—-1al'lty,'1ll11TeoUlI- .'Ketlrof-the' l'!r5WSilnaT96U'S;–One'Siiiiilantyt03hat era is-particularIy -stMRi'''rg.,….-…,…,l – and has gone. unhl Just recently at least, relatively unnoticed. The market rise which began in August, 1982 has witnessed the renaissance of the equity mutual fund. The history of the 1950's and 1960's was synonomous with the growing investment popularity of such funds. The apotheosis was reached in January, 1969, for which month new sales of funds reached 875 million. That record stood for almost 14 years until it was broken last October. The current record is 2.95 billion of sales in April of thIS year, more than triple the old peak. SInce the figures have been available, expansion of mutual-fund sales has tended to coincide with bull markets. The low and high figures, together with the percentage increase for each of the last seve bull markets, is shown in the table below. A quick glance at the successive peaks and valleys wlll show that mutual-fund activity peaked in 1969, slowed to almost a standstill in 1974-78, and has. since then. recovered to new record levels. Monthly Mutual Fund Sales (000) Low High Feb. 1958 96,385 Jan. 1962 361,845 Sep. 1962 133,653 Mar. 1966 531,587 Feb. 1967 298,312 Jan. 1969 875,861 Sep. 1971 304,449 Jan. 1973 535,423 Aug. 1974 186,580 Jan. 1977 390,200 Feb. 1978 223,500 Jan. 1981 753,800 May 1982 501,900 April 1983 2,950,600 Increase 275 298 193 76 109 237 488 The above figures understate the story, since they show sales only. During the 1970's, redemptions of funds tended to exceed sales on a fairly consistent basis and, thus, through that 1.,… lteriQli,.mutual funds were, largely, .disinvestors versed on the present upswing. The last month in in equities. That.situation has which redemptions exceeded dramatical!y re— sales was September, I 1981, and, since that time, there has been a net inflow, although managers substantially sterilized it by building up cash in early 1982. Normal behavior of fund sales is to increase concurrently with risin g markets, as they indeed have done in the present case. It is, however, also normal for redemptions to increase well on into the early stages of a typical bull market. This phase, however, apparently ended quite early in the current upswing. Redemptions of 709 million constituted 88 of sales last September, and, although redemptions have increased since then (They passed the billion-dollar level for the first time in June), they have, in recent months, constituted, roughly, only a third of sales. Thus, the net cash available for investment by fund managers has also steadily been rising to new record peaks. Since August, 9.5 billion of this cash has been committed by fund managers to common stocks, and this huge infusion must, undoubtedly, be considered one of the major factors behind the recent rise. How long can m.utual fund buyers continue to supply fuel for the engine of the bull market The simple figures in the table above raise some questions. As the last line shows, the percentage rise in fund sales over the past year has been considerably greater than that seen in any bull market in the past. Furthermore, only a year into the current upswing, the importance to the market of new mutual fund purchases has already reached the levels attained back in 1969, where activity last peaked out. In the January, 1969 record month, mutual-fund sales accounted for .127 percent of the market value of all NYSE-listed stocks, and net sales, after redemptions, accounted for .069 percent thereof. The comparable figures for June are .183 percent and .116 percent. Thus, even when adjusted for the rise in market value over the past 14 years, the mutual-fund influx has exceeded its 1969 proportions. Moreover, the major source of new mutual-fund money Ibviously must be consumer dis- posable income. At the 1969 highs, sales were 1.7 percent of U.S. consumer dispos-able income and net sales just under 1 percent. For June, 1983, sales and net sales were 1. 57 percent and just over 1 percent, respectively. It is, therefore, difficult to foresee a great deal of further expansion ex- cept as consumer disposable income grows. This, obviously. will be at a slower rate. On the optimistic side, it must be noted that, historically, net sales of funds, once having attained a high level, have tended to remain at that level for quite some time, as much as 1-2 years. Furthermore, cash holdings of funds remain l'elatively high, suggesting that managers are unlikely to sterilize future cash inflows and may even be able to continue relatively heavy levels of purchases as cash inflows slow down. It would, however. seem illogical to expect the mutual fund investor to impact the bull market to a much greater extent than he has done over the past year. ANTHONY W. TAB ELL AWT1t DELAFIELD, HARVEY, TABELL Dow Jones Industrials (12 00 p. m.) S & P Composite (1200 p.m.) Cumulative Index (7/28/83) 1209.54 163.74 2002.93 No statement or expression of opinion or ony olher motter herein contolned IS, or IS to be deemed to be, d,rectly or ,directly, on offer or the 501,cltotlon of on offer to bvy or sell any security referred 10 or mentioned The matler IS presented merely for the conVenlenCf. of the subscriber While we believe the sources of our Informa tion to be reliable, we In no way represent or guarantee the accurocy thereof nor of the STatements mude herein Any action to be tohm by the subscriber shovld be based on hiS own Invesllgo!ton and Information Jonney Montgomery Scot!, Inc, as 0 corporatIon, and lIs OfflCNS or employees, moy now have, or may later toke, pOlllons or trodes In respect to any seWfllles mentioned In th,s or ony futvre 1ssue, and svch POSitIon may be different from- ooy views now or hereafter expressed In rhls or any olher Issue Jonney Montgomery Soott, Inc, whICh IS registered WITh the SEC as on Investment adVIsor, moy give odvlce to lIs Investment odvlsory and othel customers Independently of any stotements mode In th,s or In ony other Issue Further information on ony security menlloned herem IS ovalloble on request

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