Mid-day Update

S&P 500 1,142.74 +.19%
NASDAQ 2,061.41 +.54%

Leading Sectors
Internet +2.08%
Energy +1.37%
Semis +1.08%

Lagging Sectors
Gaming -.45%
Homebuilders -1.13%
Retail -1.91%

Other
Crude Oil 37.00 +2.35%
Natural Gas 5.90 +.56%
Gold 420.70 -.68%
Base Metals 111.52 -.91%
U.S. Dollar 89.05 +.87%
10-Yr. Long-Bond Yield 4.19% +.66%
VIX 16.17 +2.60%
Put/Call .69 -1.43%
NYSE Arms .78 -57.84%

Market Movers
YHOO +15.0% after beating 1Q estimates, raising guidance and announcing 2-for-1 split.
IPIX +56.5% after announcing a reseller agreement with Abstract Security.
MAGS +10.2% on increased worldwide concern about terrorist attacks.
ACCL -12.01% after cutting revenue forecast.
INSP +12.91% on YHOO earnings and upgrade to Buy at Wedbush Morgan.
AH -8.1% on lawsuit by Assoc. of Police Organizations relating to faulty bulletproof vests.
FRED -9.4% on weaker-than-expected same-store-sales.
AGU -10.22% after lowering 1st Half earnings guidance.

Economic Data
Initial Jobless Claims for last week 328K vs. expectations of 340K.
Continuing Claims 3010K vs. 3023K forecast.
Wholesale Inventories for February +1.2% vs. +.3% forecast.

Recommendations
JNY raised to Outperform at CSFB, target $42. CHK raised to Outperform at CSFB, target $16. IPAS raised to Overweight at Morgan Stanley. Goldman Sachs reiterated Outperform on YHOO, AMLN, GE, MO, DELL, DNA and ALL. GS reiterated Underperform on POT. GS said strong results at AVT bode well for the semiconductor sector. Citi Smith Barney said FCS, CY, IRF, IDTI, MXIM and XLNX should guide higher on earnings reports, INTC and AGRA may guide lower. GS raised estimates for FD and reiterated Outperform.

Mid-day News
U.S. stocks are mostly higher mid-day as technology shares respond favorably to recent earning reports. The U.S. Federal Communications Commission will deny AT&T's request that it may be exempt from paying hundreds of millions of dollars to local telephone companies for fees related to Internet-based calls, the Washington Post reported. XM Satellite Radio(XMSR) Chairman Gary Parsons told CNBC the company expects to add more than 2.8M new subscribers this year and is working to reduce the cost of acquiring them. Genentech(DNA) President Myrtle Potter told CNBC that physicians haven't overstocked Avastin, indicating sales of the new cancer drug will remain strong. The number of Americans filing initial claims for jobless benefits fell to 328,000 last week, the lowest since President Clinton's last week in office, Bloomberg reported. Crude oil futures rose for a third day after the Energy Department forecast U.S. gasoline prices will increase to a record this summer. Wal-Mart, J.C. Penney and Target said March sales were stronger than expected as shoppers spent higher tax refunds and demand for spring dresses and blouses surged, Bloomberg reported.

BOTTOM LINE: The Portfolio is having a good day as my shorts are lower and tech longs are rising. I took profits in a few positions on the strong open, leaving market exposure at 50% net long. Rising energy prices, Condoleezza Rice's testimony, terrorism/war fears and traders speculation that retail sales are peaking are all contributing to a relatively muted reaction to very good earnings and employment news. I expect U.S. indices will remain under slight pressure until the final hour of trading. Most hedgers and sellers will finish their repositioning by then, allowing the major indices to rise into the close. However, with light holiday volume, downside volatility is always a possibility. Barring a terrorist attack or deterioration in the Iraq situation over the weekend, I expect stocks to rise Monday as investors mull the positive news over the holidays.