Tabell’s Market Letter – March 22, 1951

Wol s ton. Horell &- Goodwin.-f !.. 'i.-r-…,.,Jt'!.'–;'.!;– 7-i 'i.-f, all 'f;t–,,'r';—icJ,'Fr;,;c'',,' ,)i'I. '; ,i ' ,', NEW YORK S, N. Y. ,,.,, 35 Wall Street DIGBY 44141 t,', PHILADELPHIA 2, PA PENNYPACKER 5597'1 '( TABELL'S MARKET LEnER LOS ANGELES 13, CALIF 550 South Spring Street MADISON '132 SAN FRANCISCO 4, CALIF 265 Montgomery Street SUTTER 12700 '.t\ I';' 1f' '1;,;-,-. E' (.- t (t'f I trials,Thaenmd a8r0k.e1t has 2 on rallied from the rails to last week's lows of 242.06 on the indusreach intra-day highs of 251. 57 and 82. 48 )'1t i;j ei'on 'Thursda'. 'I'he averages are now entering the heavy overhead resistance i,'at 2')0-2')'( and 4-86. Volume on the ,advance has been Loderate. , ;,, Still advlse caution in accounts concerned mainly with longer tern capital appreciation. Would employ only 40 of available funds and would ;'', LL' concentrate such holdings in groups with good defensive qualities. The E' ;,;'following groups have good technical patterns. ,, !&fnd I The AIRLINES were still continue to my favorite group believe they will for price appreciation in work higher despite their 1950, recent I'' ; rise. Strong base patterns were built up in the 1947-1950 period, and they ;\ ;' ,have had only half of their potential advance. As an example, Eastern air- r' lines has rallied 10 points from 14 to 24. The pattern suggests an ultimate i ;'34, or a pOSSible further 10 point appreciation. Some consolidation may be ;, .-,required, but the group appe2rs attractive on all minor price declines. ,;, it I like the BUILDING SlIfPLY Group. Issues in this group are forming a very strong' base pattern. They may not do too much marketwise over the near ! , term, but be one of eventually the market they indicate substantially higher leaders of the 1952-1957 rise. levels. They could ;', , , , The DRUG group is selling considerably below the 1946 highs and is (', ,,'much less vulnerable than many other groups. It may be in a long term accu- ;, ; ,mulation area. It is a good defensive group with longer term possibilities. t FINANCE CO!YIPANIES have reacted quite sharply since Korea, but at 7' recent lows, they were at strong support levels. Regardless of popular .,,, opinion, this group appears reasonably priced and should be bought on price l'. r; 'dips. It might be of interest to observe the price pattern of this group ' in the war period of 1942 to 1945. During this period, the finance group ,,', )3,dvanced over 100, and greatly outperformed such war groups as aircrafts, i; ';'metals and steels. ;, The !YlACHINERY group is composed of many different types of companies ,trt, ,so it is difficult to predict a general pattern. There are a great many ;J,' ';individual issues in this group that have attractive technical patterns, E ','so I am classifying the group as one that should be bought on minor price declines. ,.' The NATURAL GAS group reacted quite sharply after Korea, but at the 1,,;' ' July lows were at strong support levels. I believe this group is forming ,'-'c a reaccumulation area. The action may be slow, but purchases should be ; ' ,made on weakness. This shOUld be a relatively stable group. ; If LB.!Yl. is eliminated from the OFFICE EQUIP!YlENT group, the rest ;;; d c of the issues have done little marketwise for a long period 0 Substantial ,.';, ',base patterns have been formed, and the group occupiea a good defensive , position. I would suggest buying on declines in anticipation of above ti, i,e , average and long term price appreciation. ,,, PRINTING AND PUBLISHING stocks have been backward, but they have ' formed fairly good base patterns. The group appears attractive on declines. , 'The issues are not vulnerable and offer moderate appreciation possibilities /' ',,over the longer term. ,Y' , The RETAIL TRADE group has built up good base patterns and the up- o;, side objectives have not yet been reached. I would buy on all minor price , ' -dips. ).- THEATRE AND MOTION PICTURE stocks have held in a narrow range near ,.-!.- the lows for over three years. The long term upside potentials are very large percentagewise and the group appears oversold. A very interesting ;appreciation opportunity is possible for the longer term. i; TOBACCO issues are selling close to five year lows and appear to be in a good defensive position. Appreciation possibilities, however, are . ',limited . The UTILITY group has done little marketwise since the Korean break. ', ; In contrast with new highs in industrials and rails, the utility average is slightly below its 1946 and 1950 highs. Moderate base patterns have ,'formed and the group possesses appreciation possibilities plus Ciefensive ,'qualities and good yields, ,,!Ylarch 22, 1951 ED!YlUND W. TABELL WALSTON, HOFF!YlAN & GOODWIN I – r n'Gwlqan(heSs nR!feI lIstlu,d lan or solidtation of off,rl to buy or sell any securities From time to time Waldon, Hoffman & Goodwif! ,a.,. .! 1'.,v. u '(nn-rib In lome or arrOf th IIcuri'fls-1rrlntioned her.in. Th. foregoill; mat.nal has bun prepared by us 11 a matt.r of information only It il based ' upon information b.Ii…..d r.llabl. but not .cessarily complete, is not ;uarantnd as accurate or final, and is not intended to for.close independent inquiry