Tabell’s Market Letter – May 06, 1988

Tabell’s Market Letter – May 06, 1988

Tabell's Market Letter - May 06, 1988
View Text Version (OCR)

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609 987-2300 .y 6, 1988 Tnecon'!R!ctlon-betw!en-markl!tctiowofth-e-1920sanli un u, ,ue 'uu, WI. Hro, no Lea In this space more than two years I;lgo. Following the market crash of last October, a reasonable replication of the October 1929 drop, such comparisons have become wldespread—perhaps deservedly so, since some of the similarities are eerie. The following table covers weekly action following the 1929 and 1987 highs. The first week of decline in both cases is designated as week zero. The high and low DJIA close for each week is shown, as is the highest single dayts volume for the week. As can be seen, 1929 figures are adjusted. The levels for the Dow are multiplied by an adjustment factor which makes the 1929 Dow high of 381.17 equal to the August 1987 peak of 2722.42. Volume figures are similarly adjusted upward. This adjustment makes it possible to view 1929 in a more-ar-Iess familiar context. wk No, Date ADJ DJIA ADJ HI VOL High Low mill shs Date oJ IA HI VOL High Low mIll shs o Sep 7 1929 2722.42 2641,00 27647 Aug 28 1987 2722,42 263935 213.50 1 Sep 14 1929 2677,85 2616,57 251.78 Sep 4 1987 2662,95 256138 199,90 2 Sep 21 1929 2659,71 2579,50 242,59 Sep 11 1987 2608,74 2545,12 242,90 3 sep 28 1929 256408 2463,16 246,31 Sep 18 1987 261304 2524,64 19570 4 Oct 5 1929 2460.51 232245 279,46 Sep 25 1987 2585.67 2492,82 220,30 5 Oct 11 1929 2520,22 2464,08 211,78 Oct 2 1987 2640.99 259057 193,20 6 Oct 19 1929 2506,72 231317 203,13 Oct 9 1987 2640.18 248221 19870 7 Oct 26 1929 233202 2135.33 640,75 Oct 16 1987 2508,16 224673 33850 8 Oct 31 1929 1953.48 1643,22 81541 Oct 23 1987 2027,85 173874 608,10 9 Nov 8 1929 184042 1657,94 35697 Oct 30 1987 1993,53 179393 308,80 10 Nov 15 1929 163365 1419,10 385.64 Nov 6 1987 201409 194529 22830 11 Nov 22 1929 17742. 1625,30 155.98 Nov 13 1987 1960,21 187815 206,30 1–I—–12NOI'1!ji! !j17'8..,1 cl-i-6 8 Oo-g3-l-8-()751-Nov—i!i)-l9 8-7—H-4 9.,.H)'-l,-B 9-i-ll9-;-2i——!-. 13 Dec 7 1929 188170 1726.29 234,29 Nov 27 1987 1963.53 191046 19950 14 Dec 14 1929 1872.70 173657 24934 Dec 4 1987 184897 176674 268,90 15 Dec 21 1929 1782.57 1649,08 27558 Dec 11 1987 190252 1812,17 23140 16 Dec 28 1929 1721,00 1661,65 173,52 Dec 18 1987 1975,30 1924,40 276,20 17 Jan 4 1930 1777.35 172172 20671 Dec 24 1987 2005,64 197845 203,10 18 Jan 11 1930 1785,78 1754,86 11911 Dec 31 1987 1950,10 1926.89 170,10 19 Jan 18 1930 179657 1759,36 15126 Jan 8 1988 2051,89 191131 209,50 20 Jan 25 1930 1850,28 1766.36 172.97 Jan 15 1988 1956.07 191611 19790 21 Feb 1 1930 1917,06 184199 18579 Jan 22 1988 196386 1879,14 18170 22 Feb 8 1930 1943,13 1903,70 216,75 Jan 29 1988 195822 1911,14 275.30 23 Feb 15 1930 1944.63 1918,13 182,31 Feb 5 1988 1952.92 1910,48 23730 24 Feb 21 1930 193363 188135 18857 Feb 12 1988 1983,26 189572 200,80 2S Mar 1 1930 195155 1874,63 164,47 Feb 19 1988 2014,59 1986,41 18030 26 Mar 8 1930 1968,20 1932,63 184,60 Feb 26 1988 2040,29 2017,57 21340 27 Mar 15 1930 1977,34 193020 22211 Mar 4 1988 2071.62 205786 236,10 28 Mar 22 1930 2003,76 1958,84 23001 Mar 11 1988 208107 202603 237,70 29 Mar 29 1930 204405 1993,48 251,68 Mar 18 1988 2087,37 2047,41 245,80 30 Apr 5 1930 2070,97 203748 294,76 Mar 25 1988 2067,64 1978.95 184,90 31 Apr 12 1930 2095,76 205955 282,29 Mar 31 1988 1998,34 197812 152,70 32 Apr 17 1930 210033 2086.97 218.54 Apr 8 1988 209019 1980.60 18980 33 Apr 15 1988 2110,08 200564 23420 34 Apr 22 1988 2015,09 1985,41 168,40 35 Apr 29 1988 204791 203233 157,00 As can be seen, both the Inltial 1929 coUapse and the October 1987 drop occurred in week 8 following the high and took the Dow to almost the same relative levels. At that point a divergence set in. Weeks 9.and 10 showed lower figures in …1929 ….while .)n the recent case. the market held. Volume expansion in 1929 was on the same order of magnitude as 1987 but a bit greater. The later weeks in each case also exhibit like patterns. In both cases. the market saw a recovery on light volume. The 1929-30 raUy peaked In week 32 at a level eqUlvalent to 2100, and the current high to date has been 2110 m week 33. We publish these fIgures at this point not to suggest that the similarities will continue, but to make it easier to detect when the two patterns flnally diverge. We have noted in the past our view that the differing economic conditions in 1929 and 1988 will eventually foster dissimilar market patterns. The time has come for such a divergence. If it is going to do so, to take place. AWTlt Dow Jones Industrials (12 00) S & P 500 0200) Cumulative Index (5/5/88) 2025.03 259.33 3714.85 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, dlrectty or Indirectly. an offer or the solicrtallon of an offerlo buy or selt any security referred to or mentioned The mailer IS presented merely for the convenrence of the subscriber While we believe the sources of our Inlormatlon to be reliable, we In no way represent or guarantee the accuracy thereol nor of the statements made herem Any aCllon to be taken by the subscTlber should be based on hiS own Investigation and Information Delafield. Harvey, Tabelllnc, as a corporation and ItS officers or employees may now have. or may later lake, poSllions or trades In respect to any secunbes mentioned In thiS or any future Issue, and such posilion may be different from any views now or hereafter expressed in fhls or any other Issue Delafield. Harvey, Tabel! Inc, which IS regrstered wrth Ihe SEC as an IfwestmenI adVisor, may give advlC 10 Its inVestment adVIsory and other customers Independently of any statements made In thiS or In any other Issue Further Informabon on any security mentioned herein IS available on request

Download PDF