Tuesday, August 31, 2004

Tuesday Close

S&P 500 1,104.24 +.46%
NASDAQ 1,838.10 +.09%

Leading Sectors
Oil Service +2.00%
Energy +1.75%
Iron/Steel +1.63%

Lagging Sectors
Retail -.57%
Semis -.70%
Fashion -1.02%

Crude Oil 42.22 +.24%
Natural Gas 5.07 -.08%
Gold 412.00 -.10%
Base Metals 108.43 +.21%
U.S. Dollar 88.94 -.84%
10-Yr. T-note Yield 4.12% -1.29%
VIX 15.29 -.97%
Put/Call .70 -16.67%
NYSE Arms 1.10 -57.53%

After-hours Movers
FRX -5.98% after saying that a clinical study of the experimental drug Neramexane showed the compound may be ineffective at treating Alzheimer's disease.
OTEX -18.17% after missing 4Q estimates and lowering 1Q guidance.

Goldman Sachs reiterated Outperform on MDT, target $57. Goldman reiterated Outperform on BNS and CAT.

After-hours News
U.S. stocks finished modestly higher today as a late session rally in the S&P futures boosted shares. After the close, the U.S. Federal Trade Commission said it is seeking the first fines for breaches of a rule barring calls to people whose numbers are on a "do-not-call" registry, saying a Las Vegas telemarketer made more than 300,000 unwelcome pitches, Bloomberg reported. Boston Scientific may forecast a drop in third-quarter sales of its Taxus heart stent after three recalls cut demand for the device, the company's top-selling product, Bloomberg said. Microsoft co-founder Bill Gates' personal investment fund, which is the second-largest Six Flags shareholder, has become "increasingly dissatisfied" with the amusement park operator's financial performance and may seek a spot on the company's board, Bloomberg reported. Astronomers have found a new class of planets beyond our solar system that appear more similar to Earth than other comparable objects that have been discovered, NASA and university scientists said.

BOTTOM LINE: The Portfolio finished lower today, notwithstanding the late-afternoon rebound. I added a few new longs on the close, bringing the Portfolio's market exposure to 100% net long. One of my new longs is MICC and I am using a stop-loss of $15 on this position. The market's tone improved substantially in the afternoon as many stocks rose on good volume. I expect U.S. equities to continue to rally short-term as optimism over falling energy prices, declining interest rates, pro-business political rhetoric, improvements in Iraq and subsiding terrorism fears more than offsets worries over a slowing economy.

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