Tabell’s Market Letter – December 24, 1953

– ,, MEMBERS NEW YORK STOCK EXCHANGE AND 6;Hh LEADING STOCK AND COMMODITY EXCHANGES O'S FRACISCONEW YORK PHILADELPHIA ANGELES' SAN LUGANO ISwtwlood OFFICES COAST TO COAST CONNECTEC BY DIRECT PRIVATE WIRE SYSTEM. TABELL'S MARKET LETTER ) December 24, 1953 i .. Both averages falled to better the December 31'd rally highs of 285.20 on the Dow-Jones industrials and 99.49 on'the rails. The industrials made the nearer approach to reach 284.69 on Monday, but the rails continued their unfavorable action and could rally to only 97.75, almost two points below the December 3rd high. Later in the week the rail average dropped below the December low of 95.13 and now appears to be in a downtrend. A testing of the September low of 90.39 is lndicated. I have advised avoiding the rails on the recent rally but if the average again reacted to around the 9189 area, I would advise the purchase of selected rail eqc1.ties. The industrial section of the list also dropped sharply during the week, but at Wednesday's low of 278.14, the average was still above the December low of 277.49. The industrials are now in a rather clearly defjned trading shelf between rOQghly 285 and 278. Ability to reach 286 would presumably indicate a further advance to the 290-295 level. A decline to 277 would jndicate a further drop to the 272-270 level. If this occurs, it would be a construct,ve development. Such a decline would be a 50 correction of the thirty-point advance from the September low and would place many issues in a good buyng range. The coming week wjll be the last opportunity to establish tax losses for 1953. Tax loss selling undoubtedLY held down a great many issues and an eaSing of the pressure could, result in better market action. There are a s,zeable number of issues that have declined very sharply over the last two years and are now at or approaching their downside objectives indicated by my techncal work. Some further time may be needed to bUild up basic accumulation pa,tterns but issues of this type appear to have quite thoroughly discounted most potentially unfavorable deveop ments and appear to offer a minimum of downside risk. United Fruit,which was reviewed In last week's letter, is an issue of this type. Additional issues are listed below Abbot.t Laboratores Allegheny Ludlum Steel Allls Chalmer's American lscose Blaw-Knox Bucyrus Erie Certain-Teed Crane & Company Deere & Company Eagle Picher Elliott Co General Railway Sgnal Glidden Company Industrial Rayon Inialld Steel International Harvester J0hns ManVille .Joy Manufacturing Kennecott Copper', Motorola' National 'Distillers New York Airbrake Parke Davis Pennsylvania Salt PI f,tsburgh Coke & ('hem. Ullited Fr;iit Western A1Jto Supply Yale & Towne -Pr-ic-e 1951-53 H1,gh – 64 1/2 52 1/8 44 6j, 5/8 36 78 J.7 22 1/4 22 28 5/8 12 18 1/4 28 42 1/2 25 37 27 27 3/8 337335 4 29 48 1/2 41 68 1/2 41 62 1/2 27 36 5/8 63 78 3/4 32 63 , 39 3/4 2 1/8 31 4 3/4 i 37 1/4 23 1/8 32 63 1/8 41 71 19 45 733953 8 47 57 7/8 36 48 Plus stock. Yield 4.0 7.0 9.0 6.9 7.1 9.0 .o .0 6.0 7.9 8.2 9'.2 6.9 7.3 8.5 7.4 6.7 9.5 94.. 5.3 8.9 4.3 4.2 6 5 7.7 7.9 6.9 Fitch Rating BBB BB BB BB B B CCC B BB B B B B BB BB BBB BB B BB B B B B BBB B BBB BB B A HAPPY NEW YEAR TO ALL. EDMUND W, TABELL WALSTON & CO. Th,s mily mheameora'nlnd,unmr('r,estno,tn 10 be 50me construed or all of as an oHer , or soI'C,'' I,a I Ion f 0 Her5 t 0 the secunt,es mentIoned h,',reln Th,e b or sell any ecuritlU Frm lime 10 ',me Wlslon & Co, or any partner Ihe'eof fourye9lOgd matenal ha5 as accurate been prepared or final and IS blf nol u,sntasndead m1a0 ttfeorreodfosleOf,ormdeaplieonndeo1nly'nquItlrV,5 bled upon lOfo,matlon believed relIable but nol necessarily tomp e e, IS no guran ee ,