,- -I.! I '11liil i J lEO. 0 . ' S Iil1lI& lE'1I D..IEV'1IlER 600 ALEXANDER ROAD, CN 5209, PRINCETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC 1609) 987-2300 May 27, 1988 – – . . . . -Borin g…–T-his -is -probably- th-e-.singleJ-wor-d most.. descriptive ….()fthe—prese nt… s tock-' market-scene .',, I The phones do not ring. Traders do crossword puzzles. The Dow does nothing. There is, of course, nothing new about this phenomenon. Anyone with any Wall Street experience has seen it all before, and it eventually goes away. This, however, does not make the process any less painful. Current volume figures, however minuscule they may be. actually overstate the level of activity. This is due to the emergence of yet another modern trading phenomenon–the dividend capture. May 18, for example, saw over 209 milHon shares traded. However, 64 million. over 30, was in a single stock, Philadelphia Electric. An old Wall Street adage runs, Never sell a dull market Since the past month or so certainly falls into this category, we set our computer, this week, to the task of trying to determine whether this admonition has any basis in fact or is sImply a charming bit of stock market folklore. It was first necessary to come up with a precise definition of dull, and the one we used, we freely admit, is arbitrary.. We decided, first of all, to focus on volume rather than price and decided that dullness could be defined by a tenday average of NYSE volume amounting to less than 80 of a 150day average thereof. A dull period was then defined as five or more days, without a fiveday interruption, meeting this criterion. This particular decision rule isolated 55 dull periods since 1949, the latest instance having taken place just this month when 11 of the 13 trading days between April 29 and May 17 fit our requirements. This episode was of rather short duration, SInce many of the 54 prior intervals had continued for 30 days or more, the longest, in 1951. lasting 57 days. Of the 54 previous instances recorded, we then measured the market change approximately one year -(250tadingday,,,at'''.-I'fI-3.,-Jr-6S,5k-ofAhose–cases-the-market-was-up'(me–year–..fterwartl-;-mrd—I-I in 17 cases (31.5) it was down. As is always the case with such compilations. however, it must be remembered that long time intervals, especially those as long as a year, have a bullish bias. There have been. since 1949, 10,052 separate 250-day intervals. For 66.2 of these intervals the market was up, and for 33.8 it was down. The figures for up and down markets following dull periods, then, are almost precisely what history would lead us to expect. We can, apparently, consign yet another old wives' tale to the trash bin. Such action, however, might be precipitous. We decided, despite the above results, to examine the past 54 occurrences on a chart. They tended, on such examination, to occur mostly during transition periods between upswings and downswings, happening only infrequently during welldefined up or down trends It thus seemed advisable to separate those instances where periods of dullness had occurred following bear markets from those taking place after bull markets. Again, an arbitrary definition was needed. We, therefore, defined a post-bear-market dull period as one which occurred when the market had been higher one year before. There remained 18 such cases. After 15 of them, the Dow, one year later. was up. A strange coincidence is that the three wrong signals all occurred within a 7-month period in the 1972 – 1974 bear market. Based on this re-examination, the latest boring episode took on more interest. However, still further work suggests that our newlydiscovered phenomenon appears to be becoming less useful. It is possible to identify 10 major bear-market bottoms since 1949, the first six of these having occurred through 1970. There was a dull period associated with everyone of those six bottoms. taking place prior to the low in four of those cases and only slightly afterward in the two others. The average gain -for the ..year.following&thesix-signals'was-17 andthe average gain measured from the signal to the end of the subsequent bull market was 59. By contrast no similar signal was associated with the four most recent major bottoms in 1974, 1978, 1982, and 1984. It remains uncertain, therefore, whether this particular piece of wisdom should be heeded in the present instance. It does appear, however, that the rule about not selling a dull market may be a bit more substantial than pure myth. AWTebh Dow Jones Industrials (1200) S & P 500 (1200) Cumulative Index (5/26/88) 1960.35 253.83 3652.44 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. No statement or expression 01 oplf'llon or any other matter herein contained Is, or IS to be deemed to be, directly or Indirectly, an offer orlhe solicitation of an offer to buy or sell any security relerred to or menlloned The matter IS presented merely for the convef'llence ollhe subscriber White we beheve the sources of our information to be rehable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any achon to be taken by the subsCriber should be based on hts own Investigation and mformatlon Delafield, Harvey, Tabel! Inc, as a corporation and Its officers or employees. may now have, or may later take, positions or trades tn respect to any securTltes mentioned In thl or any future ISUe, and such position may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered With the SEC as an Investment adVisor, may give adVICe to Its Investment adVISOry and other cuS10mers Independently of any statements made In thiS or In any other Issue Further Information on any secUrity menllOned herein IS available on request '.,11. I',. .l I.

'! 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 June 3, 1988 -Ple, sun whJ-ch.,.J!nallyshone-on theEstern…seaboard.Jast..weeK..–.aimed–a…Jewrayliat….the..market , and Tuesday's 'and Wednesday's trading produced-a 107-poin't Jump in the Dow, The ris';–took' place,' , moreover. on volume which exceeded 200 million shares on both days. Tuesday's tradIng activity achieving the second highest level of 1988. Before allowing joy to become totally unconfined about all this, a few reservations must be noted. We need. first of all, to reiterate our customary warning regarding the measurement of market moves In Dow points. One hundred points, these days, is a bit over 5. non-trivial to be sure, but not of transcendent significance. Volume figures. moreover, are being distorted by that latest plague visIted upon technicians by the gods of the marketplace, the dividend capture. In terms of price. aU that the rise has achIeved. essentially. is the retracement of an earlier decline of an equal amount which simply took a little bit longer. the 15-day drop which brought the average from 2058,36 on May 3 to 1941.48 on May 23, a level which ended the sequence of higher short-term lows which had characterized the market in 1988 so far. Indeed, if encouragement is to be drawn from the market's behavior over the past two weeks, it is probably more appropriate to base it on what the market did not do, rather than on what it did. As suggested above, the low attained on May 23 actually constituted a short-term downside breakout, and, in the most simple-minded sort of chart-reading terms, suggested lower prices. However, short-term breakouts during 1988, both on the upside and the downside, have tended to be false ones. The downSIde break of a fortnight ago.fitted the mold, as the market stabilized and then put on its mini-explosion this week. Before the Dow moved out of new low territory on May 23. a fair number of stocks were flIrting with lows which. if violated. would have produced some fairly ominous downside targets. Thus it IS our feeling that the best thing the rally has achieved so far IS to cause many stocks to pull away from fairly important trading-range lows. Before leaving the subject of breakouts, it is necessary to note that the Dow's ability to move above 1960 this week constituted yet another small-scale upside penetration. At this writing. this – I,…… has ,engender,ed.Jlo.oillorethan.ajy,picall9J!jLlack..of..follow-1hr.ough .with.er.age–pulling–blcl;- from its newly-won heights in Thursday's trading. It is difficult for a technician, in discussing indicator action for recent weeks. not to mention current levels of market sentiment. One of the most widely used measures of sentiment over the past couple of decades, has been the series compIled by Investors Intelligence, which measures the percentage of bullish and bearish market advisors. We poor wretches, it must be blushingly admitted, tend, collectively, to be sadly wrong at major-market turning points, turning bearish at lows and bullish at highs. The latest figures, as of May 27, just before the 107-point rise, saw only 19.8 of all advisors bullish and a whopping 54,9 classifled as bearish, There have been only nine prior periods over the past 25 years during which the number of bulllsh advisors was this low. and the present is only the seventeenth instance of an interval when bearish prognosticators were so prevalent. Again, it is necessary to express reservations. These figures, like senbment indicators in general, tend to be useful as measures of market background rather than tools for precise timing. Although there are few prior instances where bullishness has been as rare, or pessimIsm as common, as is the case today. these intervals have often lasted for months, whereas in the present case there has been but a single weekly observation. Furthermore, while periods of bearIsh sentiment regularly occur around market lows, there are frequently numerous repetitions of such periods. starting, quite often, well before the lows are reached. Thus, their significance tends to be longer term rather than immediate. WIth pessimism abounding. we confess to hearIng a distant siren song—one trying to lure us toward an optimistic stance on the theory that Armageddon seldom arrives widely heralded. We devoted this space a few weeks ago to trying to fathom what might turn out to be the ultimate significance of October, 1987. The universal tendency among market observers has been to assume that this cataclysm, by many measures the steepest drop in recorded history, must assuredly portend something for the future—in .. all … probability something rather unpleasant.,.. We 'have heard nowhere ….— …….—the sort of heresy against conventional wisdom suggesting that the collapse may possess no long-term SIgnificance whatsoever. If this is the case, a market rally, probably one much greater than even today's tiny coterie of bulls expects, might well emerge—and perhaps rather suddenly. We rush to note that the above constitutes only an observation, not a forecast. In the dull market climate of 1988 so far, nothing has emerged. in our view. to push a market observer into an unqualified bearish or bullish stance. For this to happen, there would have to be some manifestation of momentum in one direction or the other. It may be. however, that an interesting market atmosphere is slowly beginning to build. AWT'ebh Dow ,Jones Industrials (12 00) S & P 500 (1200) Cumulative Index (6/2/88) 2058.85 264.51 3746.04 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TABELL INC. No statement or expression of oplnton or any other matter herem contained IS, or IS to be deemed to be, directly or Indirectly, an ofter or the soliCitation of an offer to buy or sell any secUrity referred 10 or mentioned The matter IS presented merely for the convenience of the subscnber While we believe the sources of our Information to be reliable, we In no way represent or guaranlee the accuracy thereof nor of the statements made herein Any acllon to be taken by the subSCriber should be based on hiS own mvestlgallon and If'Iforma\!on Delafield, Harvey, Tabellinc ,as a corporation and ItS officers or employees, may now have or may later take, positions or trades In respect to any securrtles mentioned In thiS or any future Issue, and such pOSition may be different from any views now or hereafter expressed m thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered With the SEC as an Investment adVisor, may give adVice to Its mvestment adVisory and other customers mdependently of any statements made In thIS or In any other Issue Further miormatlOfl on any securrty menllOned herern IS available on request

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 1609) 987-2300 June 10, 1988 W..!L l!icLinJatw.eek's ..-Jetter.-.. if-'o-encouragement…is ..to ..be,-dra wo,…fxom … themarkets …behav.ior over the past two weeks, it is probably more appropriate to base it on what the market did not do, rather than on what it did fl Following this week's continued upside action, it is necessary to temper that encouragement by again noting that the market. so far, at least, has not done what it might have. Let us drag that by one more time. It is no news that the market averages have, since last October, generally been contained in more-or-Iess lateral trading ranges. What is somewhat unusual is the extent to which many major stocks reflect that pattern, including sixteen of the thirty DJIA components which we shall be discussing below. A week ago. we were suggesting that, as the market reached short-term lows at the end of May, many stocks were close to falling out of these trading ranges on the downside, events which, had they become widespread, would hardly have brightened market prospects. The advance, as it continued through this week, seemed like a mirror image of the previous decline, in that, to date in any case, upside penetrations have failed to take place. It is true that. in the case of the averages. marginal post-crash highs were scored. The Dow achieved a new intra-day peak on Wednesday, but not a new high close—an accomplishment the S & p 500 and the NASDAQ Industrials managed to achieve. At this writing. however, none of this has yet produced significant follow-through, anymore than did the whole succession of minor new peaks which the averages have served up during 1988 so far. The tale of the once-more-traversed trading ranges by major issues can be exemplified by the action of the sixteen Dow components in the table below. The first column gives each issue's October low followed by the upper and lower limits of the trading range which followed the rebound from that low and which continues to date. Next shown is the May low and the percentile of that figure within the trading range. (This statistic measures the stock's relative position in the range. A low number indicates the price is near the range's bottom, and a high number, near 100, shows a level in the upper part of the range.) The same procedure is then applied to the high of this Wednesday. .. . Stock Subsequent Oct. Low Trading Range May Low June 8 Percentile High Percentile Allied-Signal 27 Aluminum Co. of America 33 3/4 American Express 20 3/4 AT & T 23 Coca-Cola 29 Du Pont 75 General Electric 39 IBM 102 McDonald's 31 3/8 Merck & Co. 49 Minnesota Mining & Manufact. 45 Philip Morris 77 118 Procter & Gamble 60 Sears 26 Union CarbIde 15 1/2 Westinghouse 40 38 1/2 – 26 1/8 51 1/8 – 38 5/8 29 3/8 – 20 3/4 30 1/4 – 25 1/2 43 3/4 – 35 94 3/8 – 76 1/2 51 – 38 3/8 121 5/8 – 105 518 48 – 39 1/4 63 3/8 – 48 67 1/2 – 55 114 96 3/8 – 81 89 1/2 – 76 3/4 39 7/8 – 29 3/4 25 5/8 – 18 5/8 55 7/8 – 40 1/4 30 7/8 43 1/8 23 25 3/4 35 1/4 79 1/8 38 3/8 107 112 41 7/8 48 7/8 56 7/8 80 1/2 70 3/4 33 17 49 3/4 38 36 26 5 3 15 0 12 30 6 13 — — 32 — 58 34 1/4 50 1/2 27 1/4 27 1/2 39 1/4 87 43 3/4 116 7/8 45 3/8 56 114 64 1/4 87 118 78 36 318 20 1/8 54 1/2 65 95 75 42 49 59 43 69 70 54 73 40 10 65 21 91 As the table shows, back in May, six stocks had either penetrated their previous lows by a fraction or were within 10 percent of doing so. Almost all stocks had retreated to the lower third of their respective formations. At this week's high, by contrast, most issues had returned to somewhere well above the mid-point of the ranges involved. It is important to emphasize that, in our view, these trading ranges, remain significant andthat, when a significant-number'-of confirmed— breakouts emerge, an important clue as to the market's course will have been provided. It may be worthwhile to indicate why the fourteen remaining Dow components do not find themselves in the above table. Bethlehem Steel, Boeing, Texaco, and Woolworth have all managed to move above their 1987 highs. General Motors and Goodyear have. like these four, produced important uptrends. but are now approaching heavy overhead supplY4 Chevron. Exxon. International Paper. and USX Corp have already penetrated post-October trading ranges and appear headed for higher levels. Eastman Kodak. Primerica, and United Technologies seem to be in ongoing downtrends rather than in base areas. and Navistar is too low-priced to be of significance. AWTebh Dow Jones Industrials (12 00) S & P 500 0200) Cumulative Index (6/9/88) 2105.79 270.76 3832.01 ANTHONY W. T ABELL DELAFIELD, HARVEY, TABELL INC. No statement or toor mentioned expression 01 The mathter IS opp,riensioennoerdamnyroethefrmrahtteryhOereiIncIont;altekIS,UobysISg;lbbSeebdscTr'eldet0hbboeul;ddebreeeIbtaseurldrncdoelnrsehcoiStflyouwarnnInoinfiofveremrsoatritg\ihoaentisotoonlblacenlladrelliloniafnboolremla, nawtoeioifnIenrlnDooebwlua'af)i'eyOldrfes,peHr\ea1sNaeenn'y)t',osTeraCgblu.Jearllrlt'ajInnretcele,eHateshcea\ cadInoicfvfrceepursoretramnactteyifonrtonthmaeadrnaVednIoSyf1O1nv5roiyoerfawfoniscfdetneroosslwhoteroarercemhumepsretleoonaymfesteeemrrsse,aIxmnpedraeeyspsnreeondwde'hna,'v,yhe0,,ooarrnmaiynaYsy,Oala',ehtmeerreIlnadsks,es,UPgasd;tlnhfdloOtraeersyhefrIsIsIeIZFnuhrstIhSeecrrueIrgnitlfsieolesrmremadelloWnnllitohonntehdaenISynEsthCeiScausorriatyannmIynevfnuetlsuiolrmneeeIdsnsthauederv,elasinnodrIS, smauvacayhIlgapibovelseitaioodnnvircmeeqau1y0ebslIest

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 June 17, 1988 …..- r-I —-'I'-his-week's…majormarketev.entwlls1988'stourth .repet.ition of.the oc,,!,nc.eofta.n-epwi';e-!.!'- hIgh for the Dow Jones Industrial Average. Exuberance regarding 'this news is I ., best restrained, since the immediate aftermath of the three previous occurrences was that the market immediately turned around and went back down. It is probably worthwhile looking at what has occurred since last October in some detail, and the following table may be useful as background. It applies a 5 filter to each DJIA close since Meltdown Monday. 11 – —–l-a.t.e——- October 19 19B7 October 21 1987 October 26 1987 NovelTlber 2 1987 lecelTlbe r 4 1987 JanlJar 7 1988 JanlJar 20 1988 March 18 1988 March 30 1988 Ap T' 11 12 1988 May 23 1988 June 15 1988 Dow-JotlE'S AI,IE'rC'e ——-1738.74 2027.85 1793.93 2014.09 1766.74 2051.8 Q 187'9.14 2087.37 1978.12 2110.08 1941.48 2131.40 Percent -C-h-a-n-'1.p.- 0.00 16.63 -11.54 12.27 -12.28 16.14 -8.42 11.08 -5.21 6.67 -7.99 9.78 tIJnlber Of Days Th1S SWlns ———- -C-UR..IU-l-a-t-lv–e 00 22 3 5 10 23 33 2 55 9 64 41 10 8 113 8 121 29 150 16 166 Action from October 19th through December 4th essentially consisted of the market's ,a down from the shock set in motion by the crash, much as a pendulum winds down after being to one extreme or the other. After ten highly volatile davs through November 2nd, the Dow ,, then I–f—.res()l.v., ed. itself.intoa23day,…12declineto1766. 7oj. on 4th nf .1, .t ILiB now apparent that this was an initial successful test of the October 19th low. The rest of the table shows what has happened since. Four rallies, each achieving a new high, have taken place — December 4th – January 7th, January 20th – March 18th, March 30th – April 12th and May 23rd – June 15th. So far, each of these advances has terminated with 2 – 3 successive days on which a new peak was scored followed by a noticeable pullback. There are a number of ways we can view this history. One is in terms of market breadth, a statistic not normally useful at bottoms, but one which may have some relevance in the current instance. The most important factor to be noted is that our daily breadth index reached its high on March 17th, the next-to-last day of the second of the four upswings. Two subsequent highs — in April and this week — have seen a failure on the part of breadth to confirm. We hasten to note that we do not think it proper to interpret this phenomenon in the same way one would at a market top. We do not, in other words, see it as presaging a major decline. This weak breadth action can, however, be cited as inconsistent with the hypothesis of a major bottom. Such bottoms in the past have regularly produced new breadth highs on most short-term upswings — often well in advance of the Dow itself. For whatever it IS worth, the downward-sloping cumulative breadth line seems to be the product of increasingly severe declines rather than weaker advances. The four advancing phases since December 4th have produced, respectively, 6,109, 7,591, 2,297 and 4,816 net advances. There is little pattern here but, by contrast, the three declining episodes brought forth 1,306 net declines in January, 2,540 in March and 5,026 in April – May. In volume terms, the four rising periods were similar, averaging between 178 and 186 million shares traded. The declines have shown lessening volume. 165 million average shares in January vis-a-vis 154 million in April and May. It is not clear, of course, to what extent these figures are distorted by dividend captures, but in any case, they provide little in the way of sustenance for either the bullishor bearish argument. .- – – There is little in these numbers to change our basic opinion that the market glass may be viewed as either half-empty or half-full, depending on one's own optimism quotient. However, to the extent this sort of backing and filling continues, it would tend to pull us in the direction of optimism. Successive new highs, even with no follow-through, cannot, it seems to us, be viewed as beariSh. The more that relatively flat trading continues, the more stocks will build bases sufficient to penetrate the overhead supply, and the more existing bases will be broadened. This process may continue for some time, but it could eventually lead to a reasonably decent rally, enough of a rally to provide, minimally, a test of the previous highs. More precise definition as to timing and as to how all this fits into the long-term picture must, it seems to us, await the accumulation of further evidence. AWTlt Dow Jones Industrials 0200) S & P 500 (1200) Cumulative Index (6116/88) 2096.02 270.45 3861.42 ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL INC. No statement or expressIOn of opinion or any other matter herein contatned IS, or IS to be deemed to be, directly or indirectly, an offer Of the sohcltahon of an offer to buy or sell any security referred to or mentIOned The matter IS presented merely for the convenience of the subscnber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subSCriber should be based on hiS own investigation and information Delafield, Harvey, Tabetllnc , as a corporation and ItS officers or emptoyees, may now have, or may later take, pOSitIons or trades In respect to any secUrities mentioned In thiS or any future Issue, and such positIon may be drfferent from any VieWS now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabetllnc, which IS regIstered WIth the SEC as an Ilwestment adVisor, may give advice to ItS mveslment adVISOry and other customers Independentty of any statements made In this or In any other Issue Further Information on any security mentioned herein IS available on request

TABELL'S MARKET LETTER 600 ALEXANDER ROAD, eN 5209, P,F1II'1RETON, NEW JERSEY 08543-5209 MEMBER NEW YORK STOCK EXCHANGE, INC MEMBER NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC (609) 987-2300 – June 24, 1988 .- —-, '-James torie;-not…a;great–believer i&.th e ef-ficacy….of-'- either technicaL.analy,sis , oo)r' '' .l conventional investment management, has suggested that the most useful task performed by the investment counselor involved the determination of his clientts risk aversion. Needless to say. we disagree with Professor Lorie on a large number of issues. but we think that here he may have a point. Determining risk aversion is a complex task. often involving the necessity of deciding what one fears the most at a given time. In the uncertain markets of 1988 so far, it may well be fear as much as forecast which determines appropriate investment policy, Most of today's fears about the market and the economy tend to be cosmlC ones and can still, essentially, be summarized by the simple word 111929. This remains true despite the fact that the uncannily exact parallels between 1987 – 1988 and 1929 – 1930 have eroded over the past couple of months, We presented this history in detail in this space on May 6. The November, 1929 – April, 1930 rally peaked out 32 weeks after the 1929 high and, for so long as the last 1988 post-crash high occurred on April 12, 33 weeks after August 1987, the similarities between the two markets were striking. Now that, 44 weeks after last August, new highs are still being aChieved, a marked disparity begins to emerge. If retracement of the 1930 pattern had continued, the DJIA, around this time, would be selling for about 1550. This is, of course, all well and good but no one has seriously made the claim that forecasting 1988 action ought be as simple as overlaying it with a 1930 chart. Today's economic similarities to the 1920's and 1930's, the pessimist argues. are conspicuous enough to give one pause. Such comparisons often tend to be made in terms of long-cycle or Kondratieff-wave theory. This sort of analysis suggests that presently, as in the 1930's, the natural dynamics of a capitalist economy require an extended period of economic contraction. For those persuaded by this view, it is not hard to find flaws in the current U,S, 1–I-'—ec6fl6mie-scene -fr n. .tt bail out just about the entire savings industry of the state of Texas, A look at the loan portfolios of money-center banks does not suggest that the underlying affliction which has brought us to these straits is one restricted to unsophisticated country bumpkins running small SilL's. There is likewise the possibility. if one is so inclined, to find fault with the present state of our own securities industry. Much of its efforts, rather than financing additional productive capacity, appear. in the eyes of many observers, to involve nothing more than the shuffling of pieces of paper, The results of such shuffling tend to be increasingly creative financing schemes which produce not additional bricks and mortar but additional balance-sheet leverage. To the extent that one is totally paralyzed by these apocalyptic visions, the proscription is fairly simple. It is to step aside from the equity market and hope to find vindication as a house built upon the rock resists the buffeting storm. There is only one small problem. The Chicken Littles have been abroad for some time now. and the sky is still up there. The market of the 1930's, as the collapse became evident. plunged to new lows. Today, we have a market Which, however tentatively, is making new highs. In what is essentially a modern development, a rising stock market can become a source of fear, fear of underperformance on the part of institutional money managers. As the talk increasingly turns to summer rallies and election years, those managers with excessive cash—and the figures suggest there are not a few of these—may find themselves becoming increasingly uncomfortable. Should this discomfort become great enough to cause the sort of stampede familiar from 1982 and 1984, the upside results could be impressive. We said above that current policy is perhaps appropriately determined today by fear as much as by forecast. and there is no forecast implied in any of the above. As we have been noting repeatedly, we.have..-seen.. in.technical work -so.farho evidence,..thatr' about to deviate immediately from its current pattern involving a slightly-upwardly-biased trading range. It seems to us, however, the investor should be thinking ahead as to what his stance might be if further technical improvement materializes. ANTHONY W. TABELL DELAFIELD, HARVEY. TABELL INC. AWTebh Dow Jones Industrials (1200) S & P 500 (12 00) Cumulative Index (6/23/88) 2151.49 273.70 3899.64 No statement or expression 01 opinIOn or any other matler herem contained IS, or IS 10 be deemed to be, directly or indirectly, an offer or the solicrta1lOn of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenience of the subscnber While we believe the sources 01 our InformallOn \0 be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any action to be taken by the subScriber should be based on hiS own Investigation and mformallOn Delafield, Harvey, Tabelllnc, as a corporation and ItS officers or employees, may now have, or may later take, positions or trades In respect to any securrlles mentIOned In thiS or any future ISsue and such posrtlOn may be secdlfterent from any views now or hereaNer expressed In thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered wrth Ihe as an Investment adVisor, may give adVice 10 lIs Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further mformatlon on any secunty mentioned herein IS available on request

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 – July I, 1988 Well after the fact, experts are still unable to agree on an exact explanation of what happened to !the stock a,!et he fall. 187 ere exists some gagreement ta.!he i!,l'dJ'.9.uyf.J!l.arket . , haa- structul'eS to tie-al Illf'derlvatT'\te proo,!cts I'Qay have somethIng to do WitH. It. but preCIsely what, ' remains a matter of intense debate. We may. indeed. never have a full consensus. (There is even some revisionist theory circulating these days that margin debt had nothing to do with 1929—a notion comparable in its inane charm to the idea that Francis Bacon wrote Shakespeare's plays.) Returning to 1987, the cynics among us, of course, can regard it as simply another episode which could have corne out of Extraordinary Popular Delusions and the Madness of Crowds. Essentially what happened was the the market spent three years steadfastly ignoring deterIOrating fundamentals and then, for whatever reason, realized what It had been doing and. in October. suddenly recognized reality This recognition, ironically, came about at almost exactly the point at which the deterioration was complete. Date S & P 500 12-mo Earns PIE Consider the data in the table at left For the year 1984, the Standard & Poor's 500 earned 16.64, this figure representing a newall-time high At its Dec 1984 167.24 16.64 10.1 1984 close of 167.24, it was selling for a modest ten Mar 1985 180.66 16.39 11.0 times those earnings—in possible recognition of the Jun 1985 191.85 15.61 12.3 fact that the next three years would be difficult ones Sep 1985 182.08 15.23 12.0 for corporate profits. Over the next two-and-a-half Dec 1985 211.28 14.61 '14.5 years, to June, 1987, those earnings were to drop 13 Mar 1986 238.90 14.52 16.5 to 14.43, falling in seven of the ten quarters. The Jun 1986 251.81 14.71 17.1 market's response to this was to double. Sep 1986 231.32 14.85 15.6 Iromcally, the collapse in the second half of Dec 1986 242.17 14.48 16.7 1987 occurred almost immediately after earnings had hit Mar 1987 291.70 15.10 19.3 their lows in the second quarter of that year and were Jun 1987 304 00 14 43 21.1 starting to improve. Over the past year. the earmngs Sep 1987 321.83 15.86 20.3 rebound has been close to 40, and current estimates, – Dec 1987 247.08 17.50 14.1 – M or -1 9 R-8Pc8- – – 2 5'81l9'-'i-a'6 -1-I-;3 . admittedly subject these days to almost insta!!nt,,–I revision. call fOFfUrther '-increases1Jrtoi988 arid Jun 1988 273.50 20.50 13.3 1989. Given the extent of earnings recovery, the S & P 500 now finds itself, even at a post-crash high, selling for a rather modest thirteen times earnings. It has all, interestingly, happened before. The table at right shows similar quarterly figures for the period between September, 1959 and December, 1962 along with subsequent annual figures into 1965. The 343 whiCh the S & P earned for the twelve months ended September, 1959 was a new recovery high, and close to the all-time peak posted in 1955. The earnings low in June, 1961 led. by two quarters. the December high in prices, just as the June, 1987 earnings low had led the market high by four months. The 1962 break moved the pricel earnings ratio from a record 22.4 high to around the fifteen level in late 1962. Once again, the break occurred concurrently with the beginning of a substantial earnings recovery which, by the end of 1965, had been extended to 71 What may be relevant to the current instance is that the final realization—around the second half of 1962—that earnings were in an uptrend produced modest recovery in the S & P price! earnings ratio which. having fallen from 22 to 15, returned to the 17-18 level in 1963 and 1964. Whether such a recovery takes place in the Date Sep 1959 De c 1959 Mar 1960 Jun 1960 Sep 1960 Dec 1960 Mar 1961 Jun 1961 Sep 1961 Dec 1961 Mar 1962 Jun 1962 Sep 1962 Dec 1962 De c 1963 De c 1964 Dec 1965 S & P 500 12-mo.Earns PIE 56.88 59.89 55.34 56.92 53.52 59. II 65.06 64.64 66.73 71.55 69.55 54.75 56.27 63.10 75.02 84.75 92.43 3.43 16.6 3.39 17.7 3.39 16.3 3.26 17.5 3.27 16.4 3.27 18.1 3.09 21.1 3.03 21.3 3.05 21.9 3.19 22.4 3 37 20.6 3.47 15.8 3.53 15.9 3.67 17.2 4.02 18.7 4;55–18, 6 – – – 1 5.19 17.8 present instance will probably be the major determinant of how good the present rally is going to be. Current valuations of earnings, applied to an estimated 1989 S & P earnings level of 22.40, would result in a move of less than 8 from current levels On the other hand, recovery of just half the ground lost since mid-1987, to a pie of, say, 16.5, could produce a new high Whether the market's confidence can be restored to this degree is questionable. but such restoration does have some historical precedent. ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. AWTebh Dow Jones Industrials (12 00) S & P 500 (12 00) Cumulative Index (6/30/88) 2135.84 272.45 392632 No statement or expression oj Opinion or any other matler herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer or the so/Icltalion. of an offer to buy or sell any security referred to or mentioned The matter IS presented merely for the convenience of the subscnber While we beheve the sources of our Informauon to be reliable, we In no way represenl or guarantee the accuracy thereot nor of the statements made herein Any acllon to be taken by the subSCriber should be based on hiS own investigation and information Delafield, Harvey, Tabelllnc, as a corporation and ItS olflcers or employees, may now have, or may later take, positions or trades In respect to any secuntles mentioned In thiS or any future Issue, and such poSIi!on may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabellinc , which IS registered Wlth the SEC as an IIwestment advisor, may gIVe adVice to Its Investment adVISOry and other customers Independenlly of any statements made In thiS or In any other Issue Further information on any security mentioned herein IS available on request

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 July 8, 1988 – -patt'-rnWseihna-vteW,)-8Sstoouckr -rmeaardkeerts. areInawcoanrlele. ctdieovnottenedreaw;ftaliir7wa-me-ofuanvteo'fpUs1tjuldisyrnofvde;ratth-earyouenadrsftoiBsleiamseo-neaalcf — – year. the table below, which, for each of the twelve months, shows the number of times the market has advanced for each month, the number of declines, and the average percentage change. In all, 744 months, ,comprising the 62 years from 1926 to 1987 are included in the compilation. One Month Periods 11926-19871 Two Month Per1od 11926-1987) End Month Advances Declines Average S Chg. Jonuary 40 22 1. 27 Februsry 32 30 -0.02 Horch 35 27 0 13 AprIl 34 28 1.12 H.y 31 31 -0.73 June 33 29 0.99 July 38 24 1. 65 August 40 22 1. 65 September 23 39 -1. 41 October 33 29 -0.57 November 38 24 0.70 — –December 45 17 – -1-.-2–8 TOTAL 422 322 0.51 Advance Declines Average I Chg. 41 21 36 26 30 32 39 23 35 27 29 33 38 24 42 20 36 26 28 34 37 25 –4-4 –18- 435 309 2.53 1. 26 0.03 1. 31 0.58 0.22 2.60 3.44 0.21 -1. 94 0.21 -2-..0-01. 04 As the table indicates, of the 744 months since 1926, 422—or 57—have been advancing months, and 322—or 43—have showed declines. Thus. the normal expectation for any given month would be 34-35 advances and 26-27 declines. Similar figures can be adduced for two-month periods. 1.JF'rooom…tb.e.data ahoY.ll.,w.e.have.been.ab\eto.extr.acUour patterns of a seasQnaL!la.tlU'..e which sem to be statistically significant. The most significant one is the least known, the tendency toward 8 market decline in the month of September. Since 57 of all months have been rising ones since 1926. the expectation would be a plurality of advances over declines. However. precisely the opposite is the case for September. which. in 62 years. has produced 39 declines and only 23 advances, with an average drop of 1.41 percent. The tendency held true last year. The initial phase of the 1987 market crash took place in September, with the Dow, as of September 21, down 6.4 from its August close. Despite a later recovery. September, 1987 was still a down month. The next most significant pattern has been the year-end rally. illustrated by 45 rising Decembers in 61 years. Our readers know that we have published an annual comment on this phenomenon around December or January of each year. Another seasonal manifestation which can be statistically demonstrated. although we have no idea of the reason therefore. has been the fact that the direction in which the market moves in November has appeared to be a moderately successful predictor of the market's direction for the following year. Of the four seasonal phenomena. the least significant has been the summer rally. which is due to be analyzed at this juncture. As the table shows. the 38 advances and 24 declines for July are marginally better than one would expect. August shows an even greater aberration. The percentage advances for July and August, along with that for the two-month period ending m August, are easily the largest figures in the table. Despite these fIgures, standard tests of statistical significance suggest that the summer rally is a less reliable phenomenon than the others noted above. It has been even less reliable recently I especially in July with four of the six Julys since 1982 having been down months. The pattern of August strength seems to have continued, however. There also seems to have emerged in recent years a brand new tendency—the occurrence of important market turning points during the summer months. The two most recent known market bottoms were, of course, August 12, 1982 and July 24, 1984. In the opposite direction, the top leading to the 1983 – 1984 decline began to form during the summer of 1983 and, of course, the all-time high for the Dow, prece(Ung'the198Tcrash-;-occurredon'Aug\lst'25lastyear.—- . – -f- The post-crash high to d8te interestingly enough, is a July occurrence. having taken place this Tuesday, on July 5. It will be interesting to see whether this, or any subsequent high reached on a summer rally this year. turns out to be an important turning point. AWTebh Dow Jones Industrials (12 00) S & P 500 (1200) Cumulative Index (717188) 2119.13 271.78 3921. 90 ANTHONY W. TABELL DELAFIELD, HARVEY, TABELL INC. NOSlalemenl or expression of oplnronor any other matter herein contained IS, or Isla be deemed to be, directly or Indirectly, an offer orthe solicitation 01 an offer to buy or sell any secUrity referred to or mentioned The matter IS presented merely for the convenience of the subscriber While we beheve the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereof nor of the statements made herein Any acllOn to betaken by the subscriber should be based on hiS own Investigation and InformallOn Delafield, Harvey, Tabell Inc, as a corporation end ItS officers or employees, may now have, or may later take, posrtlons or trades In respect to any securrtles menllOned In thiS or any future Issue, and such posrtlon may be different from any views now or hereafter expressed In thiS or any other Issue Delafield. Harvey, Tabellinc , which IS registered With the SEC as an Investment adVisor, may give adVice to (\S Investment adVISOry and olher customers Independently of any statements made In thiS or In any other Issue FUl1her mformahon on any secUrity mentioned herein IS available on request I

– '. 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 (609J 987-2300 July 15, 1988 The simplest question which can be posed to the market analyst at any given time IS, Are we in – – – bull or a bear market 11 As simple as the question may . ,i often difficult to answer an., Iflclee-a–such IS the case at the moment.- -An attempfatPIumblng- tne mystery In summer, 1988 IS-,—–I- moreover, particularly instructive, SInce a byproduct of that attempt is the discovery that some of the trading patterns which have lately been confronting the technician are, historically, largely unprecedented. It is necessary to start with a benchmark, and an obvious one, of course, is October 19, 1987. That day's DJIA close was 1738.74. On July 5, less than two weeks ago, the average chalked up a post-crash high of 2158.61. The interval between those two pOints thus constitutes a 24.15 advance. requiring 179 trading days. With these simple facts, we can begin our analysis. It probably makes the most sense to begin with the hypothesis that an ongoing bear market exists. Were this premise to be the correct one, the 179 days between October 19 and July 5 would have to be considered a bear-market rally. What are the precedents for a rally of this length and extent Everybody's favorite precedent was, until recently at least, the advance from November 13, 1929 to April 17, 1930. It took the Dow up 48 and recovered more than half the ground lost on the 1929 break. That advance, however, was over In 124 trading days, eleven weeks less than the present upswing. Indeed, had today's market followed the 1930's pattern, it would, as we noted a few weeks ago, now be posting new lows—below those of October. When one applies a filter of, say, 20, to the markets of the 1930's and 1940's, one does fmd a fair number of advances during bear markets of approximately the current magnitude. In addition to November 1929 – April 1930, there were four subsequent cases in the 1929 – 1932 downswing. However, they ranged in length from 22 to 56 days. The 1938 – 1942 bear market saw a pair of greater-than-20 bear-market rallies. They were 127 and 131 days long. Since 1942, it has been appropriate to use a 20 filter as the prIma-facie definition for bull and bear markets. There has, therefore, never occurred a bear-market rally that has demonstrated the staying power of the present – -I—''Let.us examine the alternative hypothesis. It then becomes necessary to ask whether a 24.1, 179-day advance is consistent with what tends to happen at the start of a bull market. The table below shows. for each of the fourteen major bull markets since 1932, the extent to which the Dow had advanced in the first 179 trading days. It is interesting that, in half of them, the advance was roughly comparable to the present one. The two bull markets beginning in the 1930's, of course, showed much larger rises, and three of the five major upswings since 1970 also began with larger advances. We will return to this point in a moment. Bull-Market Start For First 179 Days Advance 4 Corrections Bull-Market Start For First 179 Days Advance 4 Corrections July. 1932 March, 1938 April, 1942 October, 1946 June, 1949 September, 1953 October, 1957 93.1 55.8 26.2 13.1 26.8 28.6 14.8 9 June, 1962 28.5 6 October, 1966 22.2 0 May, 1970 39.7 4 December, 1974 52.7 0 February, 1978 22.3 0 August, 1982 55.6 2 July, 1984 19.6 2 2 2 4 4 6 3 The present market has advanced 24 in 36 weeks. but the advance has been a comparatively volatile one Volatility can be measured by the application of a small filter—for example 4—to the trading period in question. This technique reveals that there have been no fewer than six corrections of 4 or more since the rise began last October .. This is a fairly large number as the table also shows.. It has been equaled or exceeded only three times—in 1932 .1938. and 1982., In each case,. the rally that tookplace over. the period was considerably greater than the rise to date. By contrast. the advances during the 1940's, 1950's, and 1960's tended to have far fewer corrections in their early stages. It must be noted that the same can be said of the bear-market rallies during the 1930's. It seems to us that the overall Impact of the above figures forces one In the direction of optimism, but with just one caveat. The modest advance that has taken place so far appears characteristic of many of the post World War II bull markets. Those initial phases, however, were quite steady with few significant corrections. When compared with the more volatile advances of the 1930's and the 1980's, where numerous short-term corrections were the norm, the present-day rise seems relatively weak. To this extent, it would seem, we find ourselves in uncharted territory. AWTebh Dow Jones Industrials (12 00) S & P 500 (1200) Cumulative Index (7/14/88) 2108.82 269.86 3915.18 ANTHONY W. TAB ELL DELAFIELD, HARVEY, TAB ELL INC. No statement or expression of Opinion or any other matter herein contained IS, or IS to be deemed to be, directly or Indirectly, an offer orthe solicrtatlon 01 an offer to buy or sell any secUrity relerred to or mentioned The matte! IS presented merely lor the convenience of the subSCriber While we believe the sources 01 our Informal1On to be reliable, we In no way represent or guarantee the accuracy thereof nor of the stalements made herein Any acllon to be taken by the subSCriber should be based on hiS own investigation and mformatlon Delafield, Harvey. Tabell Inc, as a corporation and Its officers or employees, may now have, or may later take, poSitions or trades In respect to any securities menl10ned In thiS or any future Issue, and such posilion may be different tram any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc, which IS registered With the SEC as an Investment adVisor, may give adVice to ItS Investment adVISOry and other customers mdependently of any statements made In thiS or In any other Issue Further information on any securrty menl!oned herem IS available on request

… '! 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 1609) 987-2300 ,July 22, 1988 We suggested in last week's letter that there existed certain confusing aspects of market action since the October crash. On the one hand, the market had been unusually volatIle (no fewer than six 4 corrections over ten montllSJ, yetiillOr't1irSVoratilityhiilJ-raileatoge-neratem(ichnetprogresg–on'tl1e'—- –upside, with a rise in the Dow of only 24. However, the encouraging fact revealed by intensIve analysis of this pattern was that it was beginning to look less and less like a bear-market rally. Indeed, such a rally, a 24 rise over 178 trading days, had never taken place in the period from 1926 to date. Although market action can be said, on this basis, to be encouragIng for the long-term, there remains at least one attribute of that action WhICh can be taken, properly we think, as a cause for concern. That attribute is market breadth and, if anything, breadth behavIor has been deteriorating in recent weeks. This raIses some questions as far as the immediate market picture is concerned. – – Ij 5 \ I, ; V The chart above shows the Dow since last October's low, along with our daily breadth index and another measure of the market's internal strength—a ten-day average of new highs minus new lows. It is worth examining these figures, especially breadth, in some detail. The left hand side of the chart shows the immediate aftermath of October 19, a two-day rally which brought the Dow to a high above 2000 and involved a concomitant breadth peak. While the Dow low held, breadth action continued desultory for the remainder of 1987, and our breadth index posted a new low in December. Although the DJIA was able to Score a new high in early January, breadth, at that point, was still well below its October 21 high, and it Was not until February 29 that breadth was able to score a new peak, thus confirming the Dow's rise. That was Just about the end of anything that could be termed good breadth action. The advance-decline high was achieved on March 17. As the right hand side of the chart clearly shows, new highs in the Dow in April, June, and, finally, on July 5, have remained unconfirmed by breadth. Now from an analytical pOint of view, it can be questioned whether or not we should even care about this nonconfirmation. Such a disparity is usually an attribute of market tops, and it can be argued that these are early days to be lookmg for a major top formation. The Dow has, however, advanced almost 25 and IS well beyond an unmistakable low posted Some 38 weeks ago. We cannot therefore totally rule out the possibility of a cycle top at thIS time. Even if we discount the nonconfirmation aspect, breadth action appears below average. Normal breadth action at major market bottoms has almost invariably been a dynamic and protracted rise to new peaks. This sort of thing contrasts markedlywith.,. themoveof .. the.. advance-;decline lineto new ..-lows …in December. From its December low to the March high, the breadth index gained 33.38 pOints. At a comparative stage following the 1962 bottom, breadth had risen some 55 pOints, and had moved ahead by 60 points following the low of October, 1966. In both of those instances the percentage move in the Dow over a like time period was approximately 25, just as in the the current instance. It should also be noted that our method of computation makes the 'point-advance figures for the three periods comparable. There has, moreover, been little recent improvement. Since early June, there have occurred only three days with more than 1000 advances, although there have been some fairly sizable DJIA rallIes. Although the breadth index has not moved down as sharply as it did in March – May, its action has hardly been exciting Continued deterioration could suggest yet another one of the short-term downswings which have characterized post-crash action to date, one carrying perhaps to somewhere slightly below the 2000 level. ANTHONY W. TABELL DELAFIELD, HARVEY, TAB ELL INC. Dow Jones Industrials (12 00) 2062.77 S & P 500 (1200) 266.25 Cumulative Index (7121188) 3893.95 No statement or expression of opinion or any other matter herein contained IS, or IS 10 be deemed to be, directly or Indirectly, an offer or the solicitation of an offerlc buy or sell any security referred to or mentioned The matter IS presented merely for the convenience 01 the subsCriber While we beheve the sources oj our information to be reliable, we In no way represent or guarantee the accuracy thereof nor Qf the statements made herein Any acllon to be taken by the subsCriber should be based on hiS own Investigation and information Delafleld, Harvey, Tabelllnc, as a corporation and ItS officers or employees, may now have, or may later lake, pOSlllOns or trades In respactto any securlhes mentioned In thiS or any future Issue, and such position may be different from any views now or hereafter expressed In this or any other Issue Delafield, Harvey, Tabellinc , which IS registered With the SEC as an Investment adVIsor, may grve adVIce to lIS Investment adVISOry and other customers Independently of any statements made In thiS or In any other Issue Further Information on any security mentioned herein IS available on request \

r ,, 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 July 29, 1988 Despite a Thursday and .. -,. n J rally, July, 1988 will, almost certainiy, turn out to have been a down month. The DJIA, along with almost all other averages, reached a closing high early in the month, on July 5, at 2158.61. At Wednesday's close of 2053.70, it was down 4.86 from that high. This action is in near-perfect conformity with recent trading patterns. We pointed out two weeks ago in this space that the market since October 19 had consisted basically of backing-and-filling action which could be isolated by using a 4 filter. The July 5 – 27 period constitutes the seventh 4-or-greater correction in the almost-ten-month period since the October crash. The July decline also conforms to what appears to be a recent alteration in the summer-rally pattern—if, in fact, there exists such a pattern, a proposition of which we find ourselves less convinced than most analysts. In any case, five of the seven Julys since 1982 have been downward months, and the July record for the past 63 years is now 38 advances versus 25 declines, a ratio not all that different from the overall average. For what it is worth, August, in recent years, has tended to retain its upward bias. This upward bias also appears to be valid for Augusts occurring in an election year. Based on average price, the market has been up during August in 17 of 22 election years since 1900. It will also be recalled that, in general, the second half of election years possesses a bullish bias. We are probably due for a test of whether this pattern will hold in 1988. As noted above, most major AVPAapq nPAkrl on July 5. Likewise .the.. vast of major reached lOWS on wea ana saw tneIr r JOWS on May ZJ. q. tne short-term tops for these indicators have downside objectives just above the lows of last May—indicating a test of the May lows which is likely to be successful. The table below shows the relevant statistics. July 5 July 27 Decline Downside Objective May 23 DJ Industrials DJ Transportation DJ utilities S & P 500 S 8. P Industrials S & P Financial NYSE Composite NYSE Industrials NASDAQ Composite NASDAQ Industrials 2158.61 908.45 182.14 275.81 318.52 25.22 155.57 188.33 396.1 413.1 2053.70 l!55.73 175.50 (7/22) 262.50 303.15 23.97 148.74 179.75 383.3 393.2 – 4.86 – 5.80 – 3.65 – 4.83 – 4.83 – 4.96 – 4.39 – 4.56 – 3.23 – 4.82 2010-1950 845 – 820 174 – 169 262 – 256 301 – 295 23 – 22 145 174 – 1941.48 784.05 167.67 (5/11) 250.83 290.74 21.83 142.21 172.22 363.3 312.6 What is particularly interesting, we think, is the uniformity among the widely disparate averages—to a degree we cannot recall observing in recent years. With the single exception of the Dow Jones Utilities, all of the averages in the table show a low on May 23. a high on July 5, and a low last Wednesday. The similarity of the percentage declines is likewise 'remarkable. – With the -notable exception of 'the -OTC averages, each -indicator has a short-term -top which counts to around the low of last May. If the lower end of the downside target ranges for the various indices is achieved. the action of those indices versus their respective May lows should be observed very closely. The resultant test should, we think. be a significant indicator of market direction for the remainder of 1988. AWTebh ANTHONY W. TABELL DELAFIELD. HARVEY, TABELL INC. Dow Jones Industrials (12 00) 2097.44 S & P 500 (1200) 267.35 Cumulative Index (7/28/88) 3868.98 No statement or expression of opinion or any other matter herein contained IS, or IS to be deemed to be, directly or indirectly, an offer or the solicitation of an offer to buy Of sell any security referred to or mentioned The matler IS presented merely for the convenience of the subscriber While we believe the sources of our Information to be reliable, we In no way represent or guarantee the accuracy thereol nor 01 the statements made herSln Any action to be taken by the subscriber should be based on hiS own investigatIOn and Information Delatll;lld, Harvey, Tabelllnc, as a corporation and ItS officers or employees, may now have, or may laler take, post/Ions or trades In respect to any seCUrities mentioned Irl thrs or any future ISSue, and such POSitIOn may be different from any views now or hereafter expressed In thiS or any other Issue Delafield, Harvey, Tabelllnc, which IS registered WIth the SEC as an Investment adVIsor, may give adVICe to ItS investment adVISOry and olher cuS10mers Independently of any statements made In thiS or In any other Issue Further information on any securrty mentioned herein IS available on request