Tabell’s Market Letter – August 09, 1955
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Walston &Co. MEMBERS NEW YORK STOCK EXCHANGE AND OTHER LEADING STOCK AND COMMODITY EXCHANGES NEW YORK PHILADELPHIA LOS ANGELES SAN FRANCISCO LUGANO (Swa,ld) OFFICES COAST TO COAST CON'NEC1E; BY DIRECT PRIVATE WIRE SYSTEM EDMUND W. TASELL INSTITUTIONAL LETTER August 9, 1955 Both the lindustrial and rail averages and also the various combined averages have broken/through recent trading ranges on the downside and indi- cate lower levels. However, the distributional patterns formed are'not very wide and, unless the formations are broadened, I would not expect a severe decline. The industrial average, which topped out at 471.73 and is now at 448.86 should meet initial support at around 430. If this reSistance does not hold there is exceptionally strong support in the entire 420-390 zone which, in my opinion, is a long term buying area. Considering that the aver- age sold as low as 412.60 in May, the possible decline is not of very large proportions. The rail average, which topped out at 164.59 and is now 151.22, should meet support at the 145-140 area. The 1955 low was 137 on the rails. Individual issues have formed distributional,patterns of various degrees of vulnerability. In many cases, the declines indicated are relatively small. The table below shows the downside potential of a number of leading issues based on the distributional patterns already formed. These top patterns could, of course, be widened but that would necessitate a rally from present levels Stock 1955 Price Downside High Now Foten. Stock 1955 Frice Downside High Now Poten. Allied Chemical 122 ,106 Allied Stores 63 58 Aluminium,Ltd. 112 101 Aluminum Co. 74 67 Amerada Petrol. American Can 1 04 55 9430 Amer .Cyanamid Amer. Tel & Tel Amer. Tobacco Amer. Viscose 63 57 187 184 74 ,73 66 59 Atchison T.& SF 151 130 Bendix Bethlehem Steel Caterpillar Coca-Cola 59 160 15475 47 144 12580 Colgate Palm. 62 54 Continental -Oil Corning Glaas Deere & Co. Dow Chemical DuPont Eastman Kodak General Electric General Foods General Motors Gulf Oil LB.M. Inter.Harvester 90 73 38 58 249 82 56 86 138 4854901 87 65 34 52 215 77 50 82 129 4803158 Inter.Nickel Inter. Paper 17194 17053 91-88 00-57 39-37 54-52 175-170 65 52-49 123-120 39-35 130-130 14295–41622 52 0 90-86 62 33-32 51-49 200-180 73-69 43-41 80-78 125-120 3737975—7334650 70-66 99 Johns Manville 97 Kroger 50 Libbey-Owens F 87 May Dept.Stores 44 Minn.Honeywell 70 Minnesota Mining 115 Monsanto Chern. 52 Natl.Cash Reg. 47 National Dairy 43 National Lead 84 Owens Illinois 131 Phill' P t 1 79 96 Pure Oil 41 Radio Corp. 55 Scott Paper 78 Seaboard Airline 87 Sears Roebuck 105 Socony-Mobiloil 62 Southern Pacific 65 'Southern Rail. 99 Std.Oil Indiana 53 Std.Oil of N.J. 144 Texas Company 108 Union Carbide 102 Union Pacific 178 U.S.Gypsum 285 U.S.Steel 57 Westinghouse El. 83 85 41 79 42 58 99 42 38 40 76 118 72 82 37 46 69 79 95 58 60 93 50 132 102 93 157 753l 6 5 75-70 40-38 72 40-38 53-47 100-95 39-37 31 40-39 65 110 66 80-75 3433–4300 64-62 71-67 90–87 56-54 56 81-78 46124-120 96-94 92-88 125305–212455 ' 46-42 52-47 The eight issues below have, in my opinion, excellent long term technical patterns. They are so called light blue chips rather than the traditional institutional equity but earnings, yields and technical considerations are all favorable. I would consider a decline to the areas mentioned in the last column a definite buying opportunity. High 1955 Price Now Buying Level Allegheny Ludlum Amer.Potash & Chern. Black & Decker Cutler Hammer Dresser Industries Eagle Picher Hewitt-Robins Joy Mfg. 59 87 73 79 47 36 39 57 55 84 66 74 43 35 5337 47-45 78-75 63 68-65 41-38 32 35-33 50-48 EDMUND W TAREI.I. WALij'JfQN'II& tDfO,memorandum IS 1'101 to be contrued .!I an offer or OIICllallon of offen to buy or ,ell olin)' I ha WoIIlden & Co, or any partner thereof, been prepared b,. uS as iI matter of rnformllilon only If II mba'lyilldhauvpeonanHlIlnortemraet\oton,1'1 bseolmieve edor rehIIoilbolfe tbhuet IntCotLlrniellteul llmIfelnlytiocnoemdplhelltree,l!!IS nTohte qUllran ee mat oilS aecr ItIuI r I t e or flnlll , lind nDt Intended to forecicHe ,!!dependent ,qUIfY