Stocks Higher into Final Hour on Strong Retail Sales, Falling Energy Prices and Lower Long-term Rates

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Internet longs, Biotech longs, Retail longs and Computer longs. I covered my (QQQQ) and (IWM) hedges this morning, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is higher, most sectors are rising and volume is about average. While I still suspect the Fed is done for this cycle, I am not ruling out the possibility of a hike and the suggestion of a pause in their policy statement. Either way, I believe stocks will rally. The futures are telegraphing a pause. However, I sense many equity managers are in an "I'll believe it when I see it" state. The S&P 500 has rallied 5% from recent lows and is now almost 4% higher for the year. I expect overwhelmingly bearish sentiment and performance anxiety will continue to propel stocks higher next week. I still expect the S&P 500 to return a total of about 15% for the year. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, lower long-term rates, lower energy prices, strong retail sales and bargain-hunting.