Thursday Close

S&P 500 1,116.64 -.74%
NASDAQ 1,960.26 -1.44%

Leading Sectors
Drugs -.02%
HMO's -.08%
Retail -.11%

Lagging Sectors
Semis -2.45%
Nanotechnology -2.83%
Airlines -3.86%

Other
Crude Oil 39.25 -.08%
Natural Gas 6.36 +.03%
Gold 389.00 +.03%
Base Metals 108.12 -.29%
U.S. Dollar 88.95 +.12%
10-Yr. T-note Yield 4.71% -.59%
VIX 17.03 +5.91%
Put/Call 1.13 +20.21%
NYSE Arms 1.55 +38.39%

After-hours Movers
MBG +3.24% after beating 1Q estimates substantially.
FLSH +4.01% after INTC said flash memory biz was exceptionally strong.
SKIL -14.39% after beating 1Q estimates and lowering 05 guidance.

Recommendations
Citigroup Inc. said investors should buy the yen versus the dollar on the view that increased investment in Japan's stock market will boost the currency. Apex Silver(SIL) shares are expected to double in a year as the company prepares to develop its property in Bolivia, Business Week reported. Adelphia Communication's assets would be more valuable if combined with another company, Business Week reported. Pain Therapeutics(PTIE) is undervalued at $8 as its Remoxy painkilling medication has $1 billion market potential, Business Week reported.

After-hours News
U.S. stocks finished lower Thursday on investor fears over Intel's mid-quarter update and tomorrow's jobs report. After the close, McDonald's said it will begin giving away Sony Corp. music downloads with Big Macs to help extend its monthly sales gains, Bloomberg said. Wal-Mart may change its employee wage scales in the coming months, Business Week said. The Nasdaq is trying to attract European companies to list their shares on the U.S. exchange, the FT Deutschland said. Hoshyar Zebari, Iraq's foreign misister-designate, told the UN today that Iraqi soldiers must be under command of the interim government, while declaring that the U.S.-led military coalition is necessary for the stability of the country. The U.S. Commerce Dept. said it will cut duties on $4.6 billion in Canadian lumber imports to as low as 13% from about 27%. Tyco had its debt ratings raised to investment grade by Moody's Investors Service, Bloomberg reported. Intel said sales may meet its highest estimates this quarter as demand rises for flash-memory chips used in mobile phones, Bloomberg said. James Pavitt, the CIA's director of operations, will step down later this summer, CNN reported.

BOTTOM LINE: The Portfolio fell today on weakness in my technology long positions. I took profits in several of my biotech and security long positions in the afternoon as they hit stop-loss levels and I added a semiconductor long in the after-hours session, leaving the Portfolio with 75% net long exposure. I added SNDK long and I am using a $22.75 stop-loss on the position. As I expected, Intel had a good mid-quarter report, raising its revenue guidance range and upping gross margin expectations. With oil declining and Intel giving a positive mid-quarter update, the bond market's reaction to tomorrow's data will determine whether or not the recent rally reignites or stalls. I expect tomorrow's Non-farm Payrolls to modestly exceed economists' estimates of 225,000. However, I expect Manufacturing payrolls to significantly exceed expectations of 20,000. Under this scenario, I would expect bonds and stocks to move lower in the morning and then rally into the afternoon, leaving U.S. stocks higher on the day. A payroll number below or at expectations would likely result in a higher opening for U.S. stocks and bonds that would be sustainable throughout the day.