Monday, October 03, 2005

Stocks Mixed Mid-day as Energy Prices Fall and Long-term Rates Rise

Indices
S&P 500 1,226.29 -.21%
DJIA 10,538.04 -.29%
NASDAQ 2,156.83 +.24%
Russell 2000 670.10 +.35%
DJ Wilshire 5000 12,275.70 -.06%
S&P Barra Growth 585.69 -.24%
S&P Barra Value 636.99 -.08%
Morgan Stanley Consumer 585.31 -.35%
Morgan Stanley Cyclical 728.08 -.32%
Morgan Stanley Technology 508.97 +.48%
Transports 3,733.07 -.20%
Utilities 436.67 +1.0%
Put/Call .88 +7.32%
NYSE Arms 1.01 +18.29%
Volatility(VIX) 12.55 +5.29%
ISE Sentiment 204.00 +20.0%
US Dollar 90.16 +.71%
CRB 332.92 -.02%

Futures Spot Prices
Crude Oil 65.80 -.74%
Unleaded Gasoline 208.00 -.80%
Natural Gas 14.10 +1.36%
Heating Oil 209.00 -1.86%
Gold 469.90 -.51%
Base Metals 128.96 -.42%
Copper 175.90 +1.82%
10-year US Treasury Yield 4.37% +1.23%

Leading Sectors %
Semis +1.17%
HMOs +.94%
Utilities +.89%

Lagging Sectors
Oil Tankers -.85%
Telecom -.85%
Steel -1.04%
BOTTOM LINE: The Portfolio is higher mid-day on gains in my Internet longs, Semiconductor longs, Airline longs and Oil Tanker shorts. I exited the remainder of my TLT long this morning and added IWM and QQQQ shorts, thus leaving the Portfolio 75% net long. The tone of the market is slightly positive as the advance/decline line is modestly higher, sector performance is mixed and volume is slightly above average. Measures of investor anxiety are mostly higher. Today’s overall market action is neutral given the rise in long-term rates, decline in energy prices and the mostly positive economic data. During the week ended Sept. 30, the financial industry saw the greatest net insider selling in the S&P 500. Insiders sold $27,440,469 worth of stock and bought $50,922. Overall, insider selling in the S&P 500 dropped considerably for the second week in a row. I expect US stocks to trade modestly higher from current levels into the close on declining energy prices and stabilizing long-term rates.

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