Mid-day Update

S&P 500 1,110.14 -.31%
NASDAQ 1,888.05 +.12%

Leading Sectors
Tobacco +1.45%
Restaurants +.83%
Wireless +.62%

Lagging Sectors
Homebuilders -1.31%
Fashion -1.47%
Airlines -1.56%

Other
Crude Oil 48.00 -.72%
Natural Gas 5.42 -3.62%
Gold 412.40 +.83%
Base Metals 115.22 -.05%
U.S. Dollar 88.27 -.27%
10-Yr. T-note Yield 3.99% +.29%
VIX 14.85 +.75%
Put/Call .71 -35.45%
NYSE Arms 1.43 -39.41%

Market Movers
FNM -3.91% after multiple downgrades.
CYBX +4.0% said the FDA approved its device for testing on life-threatening treatment-resistant depression.
MSO +14.2% after it said it agreed to work with tv producer Mark Burnett, who created the popular "Survivor" series.
IMGC +10.9% after beating 1Q estimates, reiterating 2Q outlook and Needham upgrade to Strong Buy.
GPN +11.3% after beating 1Q estimates and raising 05 outlook.
DRI +6.3% after beating 1Q estimates.
CVS +4.44% after Matrix rated it Strong Buy.
STMP -12.2% after canceling appearance at ThinkEquity Conference.
APPX -9.5% after the Wall Street Journal reported that the SEC is investigating the company on suspicion that it may have misled investors on progress made with a cancer drug.
DECK -6.2% after RBC Capital cut it to Sector Perform.

Economic Data
Initial Jobless Claims for last week were 350K versus estimates of 335K and 336K prior.
Continuing Claims were 2883K versus estimates of 2880K and 2878K prior.
Leading Indicators fell .3% versus estimates of a .2% decline and a .3% decrease in July.

Recommendations
Goldman Sachs reiterated Outperform on AMR, SMP, CLX, BIIB, PFE, AMGN, FS, HOT, TPX and BC. Goldman reiterated Underperform on MKL, RAI, BSC and EK. Citi SmithBarney reiterated Buy on FNM, target $86. Citi reiterated Buy on COGN, target $44. Citi reiterated Buy on GPN, target $55. Citi reiterated Buy on MWD, target $72. Citi reiterated Buy on TGT, target $50. Citi said to Buy MSTR as strength at COGN will also benefit it, target $59.

Mid-day News
U.S. stocks are mixed mid-day on continuing worries that high energy prices are leading to slower economic growth. The International Accounting Standards Board plans to overhaul the rules on accounting for leased assets, the Wall Street Journal reported. U.S. government agencies such as the FBI and private groups such as the Search for International Terrorist Entities Institute monitor hundreds of suspected terrorist Web sites on the Internet and sometimes track users, the NY Times reported. U.S. President Bush lead Senator Kerry 49% to 41% among registered voters in Florida, a Quinnipiac University poll found. WebMD promoted Kevin Cameron to CEO and said the company may spin off or sell shares in its WebMD Health unit. Halliburton said it may sell its KBR unit, which is being investigated, to boost its share price, Bloomberg said. Iraqi interim Prime Minister Allawi said the conflict in his country is part of a global terrorist threat, pledging to defeat foreign fighters and hold elections on time in January, Bloomberg reported. Florida residents were advised to prepare for their fourth hurricane strike this season as Jeanne headed westward through the Bahamas on a path that may take the storm up the state's east coast as soon as Sunday, Bloomberg said. Crude oil is falling from a one-month high after a White House spokesman said the U.S. may loan oil to refiners from the Strategic Petroleum Reserve to make up for supply disruptions caused by Hurricane Ivan, Bloomberg reported. The average rate on a benchmark 30-year fixed mortgage in the U.S. fell to 5.7%, the lowest since early April, from 5.75% last week, Bloomberg reported.

BOTTOM LINE: The Portfolio is unchanged mid-day as my declining steel and security longs are being offset by my falling software and retail shorts. I have not traded today and the Portfolio is still market neutral. The tone of the market is relatively weak. Most measures of investor complacency are rising. The weekly reading from the AAII shows the % Bulls actually jumped 12.7% to 51.22%. As well, talk of tapping the strategic petroleum reserve is not sending oil prices lower, which is a negative. I expect stocks to decline modestly into the close.