Mid-day Update

S&P 500 1,090.41 +.15%
NASDAQ 1,900.66 +.12%

Leading Sectors
Airlines +1.55%
Broadcasting +.94%
Banks +.67%

Lagging Sectors
Restaurants -1.04%
Networking -1.05%
Disk Drives -1.33%

Other
Crude Oil 41.12 -.92%
Natural Gas 6.36 -1.39%
Gold 378.70 -1.12%
Base Metals 102.54 -.13%
U.S. Dollar 91.13 +.66%
10-Yr. T-note Yield 4.73% -.96%
VIX 18.81 -.53%
Put/Call 1.27 +58.75%
NYSE Arms 1.60 +48.15%

Market Movers
AFCI +11.40% after announcing TLAB would acquire it for $1.9B.
INTU -8.11% after beating 3Q estimates and lowering 4Q and 05 forecast.
NAV -16.17% after missing 2Q and lowering 3Q guidance.
PHRM +49.2% after the FDA approved its Vidaza drug for treating a cancer-like bone-marrow illness.
NILE +32.2% on strong demand for its IPO.
SNPS +8.1% after beating 2Q estimates and raising 3Q guidance.
PETM +5.98% after beating 1Q estimates and raising 2Q/04 forecast.
CUNO +6.83% after beating 2Q estimates and raising 04 forecast.
BBOX -14.04% after missing 4Q estimates.
SFCC -12.62% after Jeffries downgrade to Hold.

Economic Data
Initial Jobless Claims for May came in at 345K versus expectations of 328K and 333K prior week.
Continuing Claims came in at 2943K versus 2956K estimate and 2966K prior.
Leading Indicators for April rose .1% versus expectations of .2% and .8% in March.
Philadelphia Fed. for May came in at 23.8 versus a 30.5 estimate and 32.5 in April.

Recommendations
THC rated Buy at Oppenheimer, target $17. JCP raised to Overweight at Morgan Stanley, target $42. PX raised to Buy at Bank of America, target $42. WMI rated Outperform at CSFB, target $36. DAL raised to Overweight at Lehman, target $10. QCOM raised to Overweight by Prudential, target $75. Goldman Sachs said AVP is top pick in household products/personal care universe. Goldman reiterated Outperform on SYMC. Citi SmithBarney said to Buy SSCC, GP and WY. Citi also said to Buy MAS, target $36. Citi reiterated Sell on BA, target $36. Citi said to Buy UNH ahead of conference next week, target $86. Citi reiterated Buy on GE, target $36.

Mid-day News
U.S. stocks are hovering near the flat-line today on conflicting signals from recent economic reports. Best Buy, Sears and CompUSA are offering consumers in-home installation and repair services in an effort to boost loyalty, the Wall Street Journal reported. The company overseeing aid for the United Nations' scandal-plagued oil-for-food program in Iraq failed to staff important checkpoints and couldn't account for "massive discrepancies" between reported and actual aid shipments, the Washington Times reported, citing an internal UN audit. Verizon said it will install its fiber-optic network in only 7 towns in Bergen County, NJ, instead of 34, after a state ruling limited the amount it could charge competitors that lease its local phone lines, the Star-Ledger of Newark, NJ, reported. U.S. TV executives are curtailing reruns and scheduling more reality shows to compete with cable and win young adult viewers, the LA Times reported. The median sale price of a home in LA county rose 28% in April, to $387,000, the LA Times reported. Verizon, privacy advocates and some members of Congress fear that the new Cellular Telecommunications and Internet Association's directory could make users vulnerable to telemarketers and e-mail spammers, the LA Times reported. Manmohan Singh, India's prime minister designate, promised a business-friendly government, Bloomberg reported. Above normal heat will prevail from the U.S. plains to the Pacific Coast and along much of the Eastern Seaboard during the summer, a government forecaster said. Comcast agreed to offer Microsoft's video-on-demand software to its customers, Bloomberg said. The Department of Homeland Security ordered Amtrak and operators of commuter trains to boost security against terrorism by increasing inspections and the use of bomb-sniffing dogs, Bloomberg reported. The Philadelphia Fed index of factory employment surged to a 31-year high and prices paid by manufacturers rose, fueling speculation the Fed will hike rates next month, Bloomberg said.

BOTTOM LINE: The Portfolio is having a good day today as my tech and Chinese ADR longs are rising and retail shorts are falling. I have not traded today and the Portfolio is still 75% net long. I expect U.S. stocks to rise modestly into the afternoon as the Put/Call ratio and ARMs index are soaring, interest rates are dropping and oil is lower.