Tabell’s Market Letter – December 02, 1949

Tabell Market Letter 3S WALL STREET, NEW YORK 5, N Y. the fact 'l!l.114ffi.e rail average was considerably behind the industrials. The letter concluded with the following Would not be surprised to see the rails take over the leadership at some time in the not too distant future. In fact, selected rails could move ahead while industrials undergo an irregular consOlidation. The rails started their move from the noon hour price of 47.98 on Thursday and closed at 50.29 on Friday. The intra-day high was 50.42 which was just about equal to the October high of 50.40. A long head and shoulders bottom appears to be forming with a left shoulder in the 47-52 range and a head at the June low of 41. The right shoulder appears to be forming now. Such a formation should result in substantially higher levels when the pattern is completed. The present advance should continue to about the 52 level. After a consolidation for a time, the really im- portant move could start. Before this happens I believe some of the poorer acting rails must broaden their potential base patterns. The industrial average reached an intra-day high of 194.16 which is just a shade below the November 23rd high of 194.35. The strength of the past few days may carry somewhat further but I would be cautious regarding new purchases at this level. I believe a better buying opportunity may be available later in the month. Long term positions should be retained. While the rails could work somewhat higher, I believe shorter term traders are justified in taking profits on further strength. Also suggest , profit-taking on several other issues in our recommended list. '. '. American Power & Light Chicago, Rock Island Denver & Rio Grande Illinois Central Phelps Dodge Shell Oil Last Sale 14 40 29 7/8 34 48 40 3/8 Approximate Originally Recommended Level 9 3/4 33 1/2 24 – 27 26 42-38 37-34 There are certain other issues in our recommended list that have shown poor action. We would take the small losses on these issues and switch into either the airline issues or wait for a correctionary move when I will list some new recommended issues. Would switch out of the following – Last ,S-al-e Approximate Originally Recommended Level Avco Corp Pressed Steel Car Reyno1.ds Metals St. Regis Paper United Mer.& Mfgrs. 5 3/8 7 3/8 19 3/4 7 1/2 12 7 6 1/2 21 7 3/4 12 1/2 The balance of the list follows – Better Grade Issues Speculative Issues Last Price Last Price Allis Chalmers American Cyanamid Amer. Home Products American News 31 1/2 47 5/8 30 34 7/8 American Airlines Budd Company Carrier Corp. Combustion Eng. Continental Baking 9 3;8 11 5,/8 16 1/8 26 1/4 17 C.I.T.Financial Comm.Credit 58 5/8 56 1/4 i4Distillers Seagram Eastern Air Lines 3/8 Crown Zellerbach 29 5/8 Lowenstein 23 7/8 Endicott Johnson 34 I/,2 Penn-Dixie Cement 22 1/2 ,. .. Federated Dept.Stores Genl.Amer.Trans. 33 1;8 47 Radio Corp Schenley 12 3/4 31 1/4 Hewitt Robins' KInretesgrteype McKesson & Robbins 15 1/2 03 311;24 lj. /. 40 1/2 .Shamrock Oil & Gas Studebaker Sunshine Mining 27 1/4 24 1/2 10 1/8 Otis EJel'ator 38 hTuahpviosenmaIennmfoiofnrmt1al\dtfiJofJnpittbHbhe..\oli&.ecJvdOe.fdt,.QeJr1ell.leiaoabfgl.tenlJsebtuJrteubnqioitllneYocmfeQisnseatrriiolyonrecdsoomhliecprilteeaitntei.,onTishoenfofotofrfgeeugrasorintaogntbemeudyateoarrsiala01c1hcausar eIRntMtfJMtr.UfrIinrlaNlfQD-'.e'FiH.wtb,..ll.jtt'.\i1\;l ..AlAfnS'fEMiL'IWr! a1l'f1Jr5'j,lofintici'\Ht6OolhfIIfSml'aUnJn'(,h&lip!eNGndoeIontdtwisIinnbqaumlireaydy. ., '—