UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 205" 49
FORM 13F
FORM 13F COVER PAGE
Report for the Calendar Year or Quarter Ended: 30-Sep-99
Check here if Amendment [ ]; Amendment Number:
This Amendment (Check only one):[ ] is a restatement.
[ ] adds new holdings entries.
Institutional Investmen t Manager Filing this Report:
Name: PALLEY-NEEDELM AN AS"SET MANAGEMENT, IN"C.
Address: 800 NEWPORT CENTER"DRIVE, SUITE 450"
NEWPORT "BEACH,"CA 92660-6316
13F File Number: 28-___ ___
The institutional investment manager filing this report and the
person by whom it is signed hereby represent that the person
signing the report is author"ized to submit it,"that all
information contained herein"is true, correct""and complete, and"
that it is understood that a"ll required items,""statements,"
"schedules, lists,"and tables", are considered i"ntegral parts of
this form.
Person Signing this Report on Behalf of Reporting Manager:
Name: B. MASIELLO
Title: DIRECTOR OF OPERATIONS
Phone: 949-760-6644_
"Signature, Place,"and Date of Signing:
_______________ _____ _____ ______ _________ _______
Report Type (Check only one):
[X ] 13F HOLDINGS REPORT.
[ ] 13F NOTICE.
[ ] 13F COMBINATION REPOR T.
List of Other Managers Reporting for this Manager:
I AM SIGNING THIS REPORT AS REQUIRED BY THE SECURITIES EXCHANGE
ACT OF 1934.
<PAGE>
FORM 13F SUMMARY PAGE
Report Summary:
Number of Other I nclude d Man agers:
Form 13F Informat ion Ta ble E ntry Total: 98
Form 13F Informat ion Ta ble V alue Total: $2,270,835
List of Other Inc luded Manag ers: N/A
No. 13F File Nu mber Name
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FORM 13F INFORMATION TABLE
VALUE SHARES/ SH/ PUT/ INVSTMT VOTING AUTORITY
NAME OF ISSUER TITLE OF CLASS CUSIP NO (x$1000) PRN AMT PRN CALL DSCRETN-MGR SOLE SHARED NONE
- ----------------- ------ ----- -- --------------- - --------- -------- -------- ---
AT&T CORP COM 001957109 60373 1387896 SH SOLE 1387896 0 0
ALBEMARLE CORP COM 012653101 802 39851 SH SOLE 39851 0 0
ALBERTSONS INC COM 013104104 41813 1056877 SH SOLE 1056877 0 0
ALLIED SIGNAL INC COM 019512102 48411 807695 SH SOLE 807695 0 0
ALLSTATE CORPORAT COM 020002101 461 18500 SH SOLE 18500 0 0
AMERICAN HOME PRO COM 026609107 30901 744605 SH SOLE 744605 0 0
APARTMENT INVT & COM 03748R101 268 7000 SH SOLE 7000 0 0
ATLANTIC RICHFIEL COM 048825103 2190 24715 SH SOLE 24715 0 0
BP AMOCO PLC - SP COM 055622104 72725 656285 SH SOLE 656285 0 0
BANCO BRADESCO - COM 059460105 222 46770 SH SOLE 46770 0 0
BANK OF AMERICA C COM 060505104 51423 923416 SH SOLE 923416 0 0
BANKBOSTON CORPOR COM 06605R106 317 7300 SH SOLE 7300 0 0
BAXTER INTERNATIO COM 071813109 44212 733809 SH SOLE 733809 0 0
BELL ATLANTIC COM 077853109 214 3185 SH SOLE 3185 0 0
BESTFOODS COM 08658U101 49687 1023149 SH SOLE 1023149 0 0
BRISTOL-MYERS SQU COM 110122108 513 7600 SH SOLE 7600 0 0
BRITISH AMERN TOB 110448107 220 12680 SH SOLE 12680 0 0
BUCKEYE PARTNERS 118230101 216 8000 SH SOLE 8000 0 0
BURLINGTON NORTHE COM 12189T104 649 23600 SH SOLE 23600 0 0
BURLINGTON RESOUR COM 122014103 492 13400 SH SOLE 13400 0 0
CANON INC -SPONSO COM 138006309 214 7350 SH SOLE 7350 0 0
CARDINAL HEALTH I COM 14149Y108 53691 985163 SH SOLE 985163 0 0
CATERPILLAR INC COM 149123101 46237 843546 SH SOLE 843546 0 0
CHEVRON CORP COM 166751107 224 2528 SH SOLE 2528 0 0
CITIGROUP INC COM 172967101 61382 1395041 SH SOLE 1395041 0 0
COMERICA INC COM 200340107 278 5500 SH SOLE 5500 0 0
COMPAQ COMPUTER C COM 204493100 36580 1599132 SH SOLE 1599132 0 0
CONAGRA INC COM 205887102 449 19900 SH SOLE 19900 0 0
CONOCO INC CL A COM 208251306 730 26300 SH SOLE 26300 0 0
DANA CORPORATION COM 235811106 587 15800 SH SOLE 15800 0 0
DAYTON-HUDSON COR COM 239753106 64427 1072660 SH SOLE 1072660 0 0
DEUTSCHE BANK-SPO COM 251525309 216 3325 SH SOLE 3325 0 0
DIAGEO PLC - SPON COM 25243Q205 35377 853751 SH SOLE 853751 0 0
DUKE ENERGY CORP COM 264399106 296 5375 SH SOLE 5375 0 0
EATON CORPORATION COM 278058102 323 3743 SH SOLE 3743 0 0
ELF AQUITAINE SPO COM 286269105 54589 595792 SH SOLE 595792 0 0
EMERSON ELECTRIC COM 291011104 43266 684728 SH SOLE 684728 0 0
ETHYL CORP COM 297659104 588 151834 SH SOLE 151834 0 0
EXXON CORPORATION COM 302290101 867 11411 SH SOLE 11411 0 0
FPL GROUP INC COM 302571104 338 6700 SH SOLE 6700 0 0
FEDERAL NATL MTG COM 313586109 58572 934351 SH SOLE 934351 0 0
FIRSTENERGY CORP COM 337932107 314 12400 SH SOLE 12400 0 0
FLEET FINL GROUP COM 338915101 57057 1557874 SH SOLE 1557874 0 0
FORD MOTOR COMPAN COM 345370100 32636 649470 SH SOLE 649470 0 0
FORT JAMES COM 347471104 49946 1871521 SH SOLE 1871521 0 0
GTE CORP COM 362320103 74546 969703 SH SOLE 969703 0 0
GANNETT COMPANY I COM 364730101 67928 981794 SH SOLE 981794 0 0
GENERAL ELECTRIC COM 369604103 750 6328 SH SOLE 6328 0 0
GOODYEAR TIRE & R COM 382550101 34775 722597 SH SOLE 722597 0 0
HEWLETT-PACKARD C COM 428236103 41081 452682 SH SOLE 452682 0 0
HUANENG POWER-CON 443304AA8 201 209000 SH SOLE 209000 0 0
HUNTWAY REFINING COM 447309105 173 99063 SH SOLE 99063 0 0
INTERNATIONAL BUS COM 459200101 82331 680424 SH SOLE 680424 0 0
INVENSYS PLC ADR COM 461204109 194 19990 SH SOLE 19990 0 0
KEYCORP (NEW) COM 493267108 343 13300 SH SOLE 13300 0 0
KIMBERLY CLARK COM 494368103 331 6275 SH SOLE 6275 0 0
LOCKHEED MARTIN C COM 539830109 373 11400 SH SOLE 11400 0 0
LOEWS CORP DEL COM 540424108 246 3500 SH SOLE 3500 0 0
MCI WORLDCOM INC COM 55268B106 47383 659246 SH SOLE 659246 0 0
MASCO CORPORATION COM 574599106 89211 2877777 SH SOLE 2877777 0 0
MATTEL INC COM 577081102 23766 1250819 SH SOLE 1250819 0 0
MAY DEPT STORES C COM 577778103 459 12600 SH SOLE 12600 0 0
MEDIAONE GROUP IN COM 58440J104 590 8635 SH SOLE 8635 0 0
MELLON BANK CORP COM 585509102 370 11000 SH SOLE 11000 0 0
MERCK & COMPANY I COM 589331107 225 3466 SH SOLE 3466 0 0
MICROSOFT CORP COM 594918104 316 3494 SH SOLE 3494 0 0
MOBIL CORPORATION COM 607059102 62321 618574 SH SOLE 618574 0 0
NORDSTROM INC COM 655664100 45113 1670852 SH SOLE 1670852 0 0
PHILIP MORRIS COM COM 718154107 57265 1675028 SH SOLE 1675028 0 0
PRAXAIR INC COM 74005P104 67734 1472470 SH SOLE 1472470 0 0
PROVIDIAN FINL CO COM 74406A102 58728 741636 SH SOLE 741636 0 0
PUBLIC SVC ENTERP COM 744573106 348 9000 SH SOLE 9000 0 0
QMG HOLDINGS COM 747257103 10 10066 SH SOLE 10066 0 0
RAYTHEON CO CL A COM 755111309 11569 238531 SH SOLE 238531 0 0
RAYTHEON CO CL B COM 755111408 61390 1237071 SH SOLE 1237071 0 0
ROYAL DUTCH PETR 780257804 259 4382 SH SOLE 4382 0 0
SBC COMMUNICATION COM 78387G103 50699 992888 SH SOLE 992888 0 0
SPDR TRUST UNIT S COM 78462F103 1431 11114 SH SOLE 11114 0 0
SCHERING PLOUGH C COM 806605101 327 7500 SH SOLE 7500 0 0
SCHLUMBERGER LIMI COM 806857108 54950 881852 SH SOLE 881852 0 0
SHERWIN WILLIAMS COM 824348106 29081 1388959 SH SOLE 1388959 0 0
TEXAS UTILITIES C COM 882848104 410 11000 SH SOLE 11000 0 0
TREDEGAR CORP COM 894650100 733 34278 SH SOLE 34278 0 0
USX MARATHON GROU COM 902905827 52998 1811884 SH SOLE 1811884 0 0
U S BANCORP DEL COM 902973106 791 26205 SH SOLE 26205 0 0
UNION PACIFIC RES COM 907834105 384 23600 SH SOLE 23600 0 0
U S WEST INC (NEW COM 91273H101 810 14200 SH SOLE 14200 0 0
UNUMPROVIDENT COR COM 91529Y106 26969 916149 SH SOLE 916149 0 0
WARNER LAMBERT CO COM 934488107 425 6400 SH SOLE 6400 0 0
WASHINGTON MUTUAL COM 939322103 48497 1658034 SH SOLE 1658034 0 0
WELLS FARGO & CO COM 949746101 49240 1242646 SH SOLE 1242646 0 0
WILLIAMS COS INC COM 969457100 61620 1637728 SH SOLE 1637728 0 0
XEROX CORP COM 984121103 54880 1308618 SH SOLE 1308618 0 0
DAIMLERCHRYSLER AG COM D1668R123 364 5249 SH SOLE 5249 0 0
REXAM PLC COM G1274K113 91 21200 SH SOLE 21200 0 0
NORTHERN FOODS PL COM G66304109 73 41800 SH SOLE 41800 0 0
SAINSBURY J. PLC COM G77732108 218 35000 SH SOLE 35000 0 0
SANKYO CO LTD COM J67822106 219 7300 SH SOLE 7300 0 0
</TABLE>
