Mid-day Update

S&P 500 1,114.55 -.05%
NASDAQ 1,922.80 -.46%

Leading Sectors
Iron/Steel +3.12%
Restaurants +2.33%
Networking +2.03%

Lagging Sectors
Homebuilders -1.19%
Airlines -1.78%
Semis -4.14%

Other
Crude Oil 40.40 +2.17%
Natural Gas 5.94 +.68%
Gold 405.60 +.82%
Base Metals 111.95 +.01%
U.S. Dollar 87.54 -.32%
10-Yr. T-note Yield 4.47% +.13%
VIX 13.63 -5.74%
Put/Call .94 +20.51%
NYSE Arms 1.23 +41.38%

Market Movers
GENZ +12.1% after beating 2Q estimates and raising 04 forecast.
INTC -8.7% after meeting 2Q estimates, lowering 04 gross margin estimate and reiterating 3Q forecast.
JNPR +13.4% after beating 2Q forecast substantially and announcing $250m share buy-back.
CZR +16.2% after the Wall Street Journal reported that HET may acquire it.
MOGN +13.0% after beating 2Q forecast and raising guidance on agreement to help market AAII's painkiller, Kadian.
KOMG +11.6% on bargain-hunting after lowering 2Q estimates.
HDI +6.1% after beating 2Q estimates.
IMN -21.4% after lowering 2Q forecast.
NTY -9.3% after RBC Capital downgrade to Sector Perform.
LIN -6.3% after lowering 2Q and 04 forecast.

Economic Data
Advance Retail Sales for June -1.1% versus estimates of -.8% and an upwardly revised +1.4% in May.
Retail Sales Less Autos for June -.2% versus estimates of +.2% and an upwardly revised +.9% in May.
Import Price Index for June came in -.2% versus estimates of +.1% and a downwardly revised +1.4% in May.

Recommendations
Goldman Sachs reiterated Outperform on JNPR, GCI, STZ, HCA, PFE, ROH, NFX, MDT and INTC. Goldman reiterated Underperform on BA and SGP. Citi SmithBarney reiterated Buy on MER, target $73. Citi reiterated Buy on INTC, target $33. Citi reiterated Buy on CELG, target $75. Citi reiterated Buy on JNPR, target $32.50. Citi reiterated Buy on SPRT, target $11. Citi reiterated Buy on UNH, target $86. Citi reiterated Sell on BMY, target $25. Citi reiterated Buy on YUM, target $40. TXN raised to Buy at Deutsche Bank, target $26. DISH rated Outperform at CSFB, target $37. ZLC raised to Buy at Merrill, target $24.

Mid-day News
U.S. stocks are modestly lower today as rising oil prices, weaker retail sales and disappointment over Intel's report weigh on shares. China's Premier Wen Jiabao said the government will keep up lending curbs aimed at slowing the world's seventh-largest economy, adding more needs to be done to rein in investment and solve energy shortages, Bloomberg reported. Denver billionaire Philip Anschutz's development company will announce today it's ready to start construction on a $1 billion commercial development near Los Angeles's Staples Center, the LA Times said. Boston and NY City are receiving expedited shipments of antidotes designed to counter chemical attacks ahead of the Democrat and Republican national conventions, the Boston Globe reported. Northwest Airlines passengers are facing flight delays and cancellations after a power outage near Minneapolis caused the fourth-largest U.S. airline's internal computers to fail, CNBC said. Daniel Benton's Andor Capital told investors in a letter that co-portfolio manager Chris James is leaving the hedge fund firm to start his own company, Bloomberg reported. A divided U.S. SEC proposed that hedge fund managers be required to register with the agency, the first step in Chairman Donaldson's campaign to open the $850 billion industry to greater scrutiny, Bloomberg said. More than three-quarters of U.S. consumers age 50 and older support legislation that would allow them to buy cheaper medicines from Canada and other countries, according to a poll financed by the consumer group AARP, Bloomberg said. U.S. retail sales fell in June by the most since 2003, underscoring forecasts that consumer spending slowed in the second quarter from the previous three months, Bloomberg reported.

BOTTOM LINE: The Portfolio is unchanged today as my declining longs are offsetting my falling shorts. I took profits in a few shorts into this morning's weakness and the Portfolio is now market neutral. While investors are becoming less complacent today, readings are not at levels associated with bottoms. Moreover, rising oil prices will likely prevent any substantial rally from materializing this afternoon.