Monday Close

S&P 500 1,087.12 -1.05%
NASDAQ 1,896.07 -1.14%

Leading Sectors
Semiconductors +.41%
I-Banks -.50%
Papers -.51%

Lagging Sectors
Airlines -3.01%
Oil Service -3.05%
Nanotechnology -6.14%

Other
Crude Oil 38.95 +.05%
Natural Gas 6.18 -.06%
Gold 378.00 -.18%
Base Metals 99.59 -3.56%
U.S. Dollar 91.75 +.21%
10-Yr. Long-Bond Yield 4.79% +.31%
VIX 19.77 +9.05%
Put/Call 1.25 +25.00%
NYSE Arms .67 +3.08%

After-hours Movers
LTON +37.5% after substantially beating 1Q estimates and raising 2Q guidance.
PSUN +3.32% after beating 1Q estimates and raising 04 forecast.
MCIA +3.42% after announcing another 7,500 job cuts.

Recommendations
Goldman Sachs reiterated Underperform on PSS and RKY.

After-hours News
U.S. stocks finished lower Monday, sending the Dow below 10,000 for the first time this year, on continued fears of rising interest rates and slowing Chinese economic growth. After the close, Merrill Lynch said it gained approval to invest in China's stock markets, the first foreign bank to be licensed this year, the Financial Times reported. U.S. auto safety regulators Wednesday will release proposed rules that may reduce by as much as 11% the 9,000 deaths annually from side-impact crashes, Bloomberg reported. Electronic Data Systems said it may cut its dividend or issue stock to raise more than $1B to avoid a cut in its credit rating to below investment grade, Bloomberg reported. Chiquita Brands said the U.S. is investigating payments the company's Colombian subsidiary made to groups identified as foreign terrorists, Bloomberg reported. IBM, McDonald's, GE and other large U.S. employers said they may use their buying power to extend health insurance to workers who lack coverage, Bloomberg reported.

BOTTOM LINE: The Portfolio fell slightly today as I increased market exposure into the afternoon weakness by adding several new long positions. The Portfolio is now 50% net long. Semiconductors significantly outperformed again today in another sign that tech is stabilizing. I believe that the major U.S. indices are very close to at least a short-term bottom and possibly an intermediate-term one. I will look to increase market exposure into any extreme weakness tomorrow in anticipation of this expected rally. One of the new longs I added into afternoon weakness was SWIR. I am keeping a $21 stop-loss on this position.