Stocks Modestly Higher into Final Hour, Led Again by Cyclicals

BOTTOM LINE: The Portfolio is about even into the final hour as gains in my Networking longs are offsetting losses in my Energy-related shorts. I covered some of my (IWM) and (QQQQ) shorts and added to my (GOOG) and (CIEN) longs today, thus leaving the Portfolio 50% net long. The tone of the market is slightly positive as the advance/decline line is modestly higher, sector performance is mostly positive and volume is above average. The Johnson Redbook same-store sales index rose a very strong 5.1% year over year last week vs. a 4.6% rise the prior week. This is the strongest reading since June 2004. The long-term average is a gain of around 2.5%. I still expect retail sales to decelerate back to around average levels over the coming months. I expect US stocks to trade mixed into the close from current levels as higher energy prices offset lower long-term rates.