TABELL'S MARKET LETTER 35 WALL STREET. NEW YORK 5. N. Y. Digby 4-4141 Action of the market strengthens the conviction that He are in the final stages of the thirteen-month decline. While the major trend of the averages is still downward, the intermediate trend has indicated an upward reversal. In fact, market action is satisfactory enough to warrant the advice to purchase on all minor setbacks. The present strength in the market should carry somewhat further. I would expect some resistance in the 169-171 area. Normal technical action after such an occurrence would indicate a correction back to 167-165, from which point the market advance should broaden sharply. Friday's Journal of Commerce starts its editorial with the following comment One fallacy of our times is to think too much in terms of aggregates and averages. The public opinion poll takers are not the only ones to go wrong by carrying such thinking to extremes. While this editorial relates to industrial averages and over-all business statistics, the . same comment could also be applied to the. stock market. Possibly we think too much in terms of stock market averages rather than in indi- vidual stocks. For example, the Dow-Jones industrial average closed on December 31st, 1948, at 177.30. At Friday'S close of 168.08 the averages were down 9.22 points for the first six months of 1949. It is interesting to compare this average market performance with the performance of some of the issues in our recommended list Dow-Jones Industrials American Cyanamid American Home Products American Pro & Lt American Pro & Lt. 5 pfd American Seating Brooklyn Union Gas Carrier Corp Cities Service Commercial Credit Continental Baking Distillers Seagram Federated Dept.Stores Kresge, S.S. Kress, S.H. Lowenstein Niagara Hudson Penn-Dixie-Cement Sunshine Biscuit 1948 Close 177.30 38 5/8 25 7'7/8 73 3/4 24 1/8 19 1/2 13 43 5/8 48 1/2 13 1/4 15 27 3/4 38 54 1/2 22 3/8 7 1/2 19 1/2 38 Last Sale 168.07 41 3/4 ,28 1/8 10 1/8 78 l/2 29 3/8 28 1/4 13 1/4 43 7/8 49 5/8 13 7/8 15 28 3/4 39 5/8 57 1/4 22 7/8 10 1/2 21 1/4 43 I have included in this compilation only those issues which show favorable current action. In fact, would concentrate purchases in these issues. Would add the following to our recommended list during periods of market correction Combustion Engineering-Superheater (25) Standard Gas 4 pfd. (23 7/8) and U.S. & Foreign Securities (21 1/2). July 1, 1949 EDMUND W. TABELL WALSTON, HOFAN & GOODWIN Tbls rMmcrondum II nClt to b. construed a. on offer Clf tollettatlon of off.,. to buy or ,.n an, curltle.. From tim. to tim. Wollton, Hoffman' Goodwin may hon an lnte,t In some or all of the leeurltlu mentioned he,.ln. Th. fore;otnQ mat.rlal hal b'.n prtlpored by us al ill matter of Information only. It r. baled upon Information believed NIT.bl. but flot necessarily complete, 11 not Quatnt..d oil accurate or final, and Is not Intended to foreclale Independent Inquiry.

TABELL'S MARKET LETTER 35 WALL STREET, NEW YORK 5, N. Y. Digby 4-4141 The pace of the advance has slackened somewhat as the averages approach the rather heavy overhead resist- ance above 170. Friday's intra-day high on the industrial average was 171.53. The rail average continues to lag. The equivalent of 171 on the rail average would be 46 as against Friday's close of 43.19. The resistance above 170 consists of the six-month trading range between the November low of 170.35 and the January high of 182.50. The low was tested again in February at 170.56 and finally penetrated downside in late May. It is perfectly logical to expect some resistance as this range is entered but I expect this resistance to be only temporary. Just how much technical correction is needed at this point is problematical. The various gauges of short term action are approaching an overbought condition. This overbought condition appears only on the minor trend indicators. The intermediate and longer term trend indicators continue to show very favorable patterns. This temporary condition of the minor trend could be corrected either by a minor decline of two or three days duration or a cons'olidating move of a week or so around present levels. In either event, such a move would be of interest to only shorter term traders. A normal one-third to one-half correction of the eleven point advance from the June lows would carry back to 168-166. Regardless of the action of the averages over the shorter term, individual issues should move ahead. The rails appear to be laggards. While no longer term uptrend signal has been given, I believe it is the time to start, in a modest way, to accumulate selected rails. The only rail issue on our recommended list is Denver, Ro Grande & Western 20). To this I would add Atchison, Topeka & Santa Fe (834)' and Illinois Central (24). July 8, 1949 EDMUND W0 TABELL WALSTON, HOFFMAN & GOODWIN This memorandum Is not to b. construed a. an offer or IOlIclteHon of offen to buy or ..II lIny 1.00IItl… from time to tim. Walden, Hotfm5 & Goodwin may he…. on Interest In lome or all of the SKurltl.s mentloMd he,.t. Th. forllQoln; meterle' has ben pplI'.d by us S fI motter of Information onl,. It Is, bad upon Information believed ,.lIebl. but not nee.swIIl, complete, I. not Quarantd as accurate or final. end II not Intend.d to foredo Independent Inquiry.

TABELL'S MARKET LETTER 35 WALL STREET. NEW YORK 5. N. Y. Digby 4-'1141 The market continues to move ahead and has closed higher for four successive weeks. This is the longest sustained advance since September, 1948. Even though the industrial average is now in the strong 171-182 upside resistance area, there are as yet no signs of technical deterioration. The shorter term gauge which was approaching an overbought condition the first week in July, corrected itself by a four day consolidation in the 169-171 range. The intermediate term gauge is still quite a distance away from an overbought signal. The two hundred day moving average is around 174 as compared with Friday'S closing of 173.48 on the Dow-Jones industrial average. Ability to penetrate this long term moving average \'/Ould be a very constructive market signal. Selling pressure continues to slowly decline and buying interest to slowly increase. Buying interest, while still unimpressive, appears to have made an important turn. The overall pattern is favorable with the intermediate trend still pointing up and with indications that nearby reactions will be of only temporary signifi- cance. However, a sharp advance (say to the 177-180 area) between now and the end of the month would weaken the technical pattern'df such a rally occurs, I would suggest switching groups that have shown relatively unfavorable action and await a correction to the low 170s to replace with groups that have shown favorable action. Groups showing favorable action include – Agricultural Equipment Airlines Baking Business Machines Dept.Stores & Mail Order Drugs Food Packing Glass Investment Companies Liquor MotionPictures Natural Gas 011s Retail Food Textiles Tobacco Utilities Variety Chains July 15, 1949. EDMUND W. TABELL WALSTON, HOFFMAN & GOODWIN ThIs m.morandum Is not to b. nttra .n on offt;r or solicitation of off.rs to buy Ot 11 an, ..curtlla. From tIm. to tim. Wallton, Hoffmon & Goodwin may have lin Int,,..st In some or U of tile s.curltles mentlon.d h.,..ln. lb. for'Qolnt mat.rlal hal b..n prepared by us al a matte, of InformatTon only. It II baled llpon Information believed reliable but not necessarily compl…., II not ljluaranteed 151 accurat. or final, and Is not Intended to 'o,..co,. lndep.ndent inqulry.

TABELL'S MARKET LEnER 35 WALL STREET. NEW YORK 5, N. Y. Olgby 4-4141 After Wednesday's high of 176.14 in the industrial average,the market has sold off moderately. The average has advanced sixteen pOints in twenty-five trading days. Whlle this advance has been rapid, it has been very orderly and at no time has there been any indication of climactic buying. Neither the short term or intermediate term gauge of market act has become overbought. There is no sign of distribution and the technical pattern remains strong with the short interest increasing. Any correction from this level should be extremely moderate. The longer term action also is improving and buying interest continues its slow increase. Until more signs of weakened technical conditions appear, would retain recommended issues. Listed below are half of the issues in my recommended list. Those listed today are the better grade issues which have paid dividends over the past ten years. The more speculative group will be reviewed in the next letter. Those marked with an asterisk show above average action and should be purchased during any periods of market irregularity. Addressograph Multigraph American Cyanamid American Home Products American Seating Atchison,Topeka & S.F. , Bend-i–JLIT.ia.t.1Qn …Bige.1.o.w-&a'ltford Borg Warner Commercial Credit a.stmaR-KQdak- Endicott Johnson Federated Dept. Stores 'Fletorre-TIre-&-Rubber -Fii11 L'kote Fruehal.1f-T-la-i..;J,er He\'/itt-Robins –Hel-ial!d Pttraa;l Intertype Corp Johns Manville -d'oy-Ma,R,y.tac.Uo!-ring Kresge (S.S.) -K,r-e&8-(-8..& ) -PaTa-f.in-e-B-empallile s Phelps Dodge S-ea;rs-Reebu'Ck Shell Union 011 Sperry Corp Standard Steel Spring -SyrvaR4aetrc .-surrsh1rre-i3'1scuit l',eung,s4l-Qwn-8he-et- & Tube Closing 7!..22!..42 31 7/8 44 27 5/8 30 1/2 86 1/4 29 3/4 24 1/8 46 5/8 50 3/4 41 3/4 31 7/8 28 3/4 45 7/8 26 17 15 5/8 20 3/4 25 1/2 38 1/2 35 40 59 17 1/8 42 40 34 7/8 24 1/8 15 18 1/2 48 1/2 62 1/4 Approximate Originally Recommended Level 31 36 1/4 25 1/4 27 83 1/4 32 28 3/4 48 51 44 31 1/2 27 1/2 46 24 3/4 19 3/4 17-19 22-24 26 36-34 35 36 3/4 52 17 lj4 42-38 v 39 37-33 26 14 1/2 20 3/4 41 3/4 66 r \ '. July 22, 1949 EDMUND W. TABELL '!lALSTON, HOFFMAN & GOODWIN Thll memorandum II no. have en Inrest In some to or be en conl'lrued 1III en of the ,ecarltlel offer or ,ollcltatlon of mentIoned he,..ln. The offers to fort90ln; buy or .ell eny .ecurltles From mte,lel hel b.en prepared by time to UI al a timmaetteWr aollf'loInnlorHmoafftmioann & Goodwin lTWIy only. It I, baled upon Information believed relleble but not nec..sarlly compl.t., Is not ;uarant..d al accurate or final, and II not Int.nded to toreclo Indep.nd.nt Inquiry.

TABELL'S MARKET LEnER 35 WALL STREET, NEW YORK 5, N. Y. Digby 4-4141 The market has been going through a period of consolidation in approximately the 174–177 range for the last nine trading days, A downside penetration, if it ,occurs, should not carry the industrial average much lower. An upside penetration could continue to 180-183. The important thing to be deduced from the technical action of the market over the past two months is, in my opinion, that while the averages may have some difficulty in moving sharply higher, special situations can now be bought with much less fear that sharp downside liquidation in the general market will also carry favorable situations downward with it. Listed below are the remaining issues in my recommended list. This portion consists of the more speculative issues. Stocks marked with an asterisk show above average action and should be purchased during periods of market irregularity. American Airlines American Power & Light Avco Brooklyn Union Gas Budd Company Carrier Corporation Cities Service Combustion Engineering Continental Baking (-a-GQBpeT-Besme Denver & Rio Grande Eastern Airlines -F1r Illinois Central International Min.& C Lowenstein Niagara Hudson Penn-Dixie-Cement Pressed Steel Car Radio Corporation Reynolds Metals St. Regis Paper Schenley Shamrock Oil & Gas -Sharon-St'eei- Studebaker SUnshine Mining Western Pacific -Whe'e-n1'lg-SJ;ee-l Wh1.te-Sewing-M-ac-h1ne Closing 7/29/49 10 10 7/8 5 1/4 30 1/2 9 3/8 14- 1/44-7 1/424 1/2 14- 3/8 22 3/8 22 1/2 14- 7/8 11 1/2 24 7/8 26 1/2 23 1/4 12 21 5/8 6 1/8 10 1/2 19 3/8 6 5/8 26 1/2 25 3/4 2422 3/4 9 24 5/8 34 3/4 22 1/2 (a) Adjusted for 50 stock dividend. Approximate Originally Recommended Level 9 3/4 9 3/4 7 26 1/2 9 13 40 24 7/8 13 1/2 18 24-27 15 3/f; 16 1/2 24 1/2 25 1/8 22 1/2 9 19 1/4 6 1/2 11-13 21 7 3/4 26-30 31 33-35 19 10 20 1/442 ..44 19 1/2 July 29, 1949 EDMUND W. TABELL WALSTON,HOFFlfillN & GOODWIN Thll .morondum II not to b. construed ill an offer or solicitation of offe… to blly or ,.11 an, securitIes. From time to time Walston. Hoffmu & Goodwin mey ha…. an Intereat In SCrM or all of the securitIes mentioned bereln. 'e foroln9 material hal been prepared by UI as a matter of Information only. It Is baled upon Information bellev.d relleble but not necessarll, complete, It not qllarant..d al accurate or final, and I. not intended to foreclose Independent lnqulry.