Stocks Lower into Final Hour on Rising Energy Prices and Weaker Housing Data

BOTTOM LINE: The Portfolio is lower into the final hour on losses in my Networking longs, Computer longs and Energy-related shorts. I added to my (IWM) and (QQQQ) shorts today, thus leaving the Portfolio 25% net long. The tone of the market is negative as the advance/decline line is lower, most sectors are falling and volume is light. The NAHB Housing Market Index fell to 50 in April vs. estimates of 55 and a reading of 54 in March. This is the lowest level since November 2001. I continue to believe the slowdown in housing will result in consumer spending falling back to average rates from robust levels. U.S. economic growth has likely peaked for the year during the first quarter. This should also result in a peak in long-term rates and commodity prices. A continuation of recent market turbulence is likely in the near term as investors shift from more cyclical sectors into more growth oriented shares. I expect US stocks to trade mixed-to-lower into the close from current levels as worries over consumer spending more than offset bargain hunting and lower long-term rates.