Stocks Higher into Final Hour on Another Fall in Oil Prices and Technology Sector Strength

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Semi longs, Computer longs, I-banking longs, Internet longs and Energy-related shorts. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is slightly positive as the advance/decline line is about even, almost every sector is rising and volume is above average. The Saudi Tadawul Index is falling another 223 points today to 7,559, which is 61 points from its December 4, 2006 low. The index has collapsed 60.1% in less than a year. The gut wrenching declines in Middle Eastern bourses remain a big red flag for the many oil bulls. I suspect the smart money in the region that was bailing early last year was laughing at how the hugely flawed "peak oil theory" that they helped perpetuate had become an accepted truism around the globe, fueling the manias for all commodities and emerging markets. Given the steep declines in many commodity and emerging market stocks, the major averages are holding up extraordinarily well. Many market-leading growth stocks are already 5%-10% higher year-to-date. I continue to believe that large investors, both bears and many bulls, have cut back long exposure over the last six weeks in anticipation of the imminent decline they foresee. The longer we base around current levels, the higher the probability of an upside surge, in my opinion. I expect US stocks to trade modestly higher into the close from current levels on short-covering, more economic optimism, lower energy prices and bargain-hunting.