DJIA Surging Back Near All-Time High into Final Hour on Another Drop in Long-term Rates and Buyout Speculation

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Software longs, Semi longs, Computer longs and Retail longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is very positive as the advance/decline line is substantially higher, almost every sector is rising and volume is heavy. I continue to believe that long-term rates have peaked for the year as economic growth decelerates again in the third quarter and inflation concerns diminish further. Interest rate-sensitive sectors are especially strong today. Copper inventories in Shanghai jumped 6.4% this week, however, the metal is slightly higher on today's US economic news. I suspect China will raise interest rates again this weekend. My intraday gauge of investor angst is at above average levels, despite today's sharp rally in stocks. I expect US stocks to trade mixed-to-higher into the close from current levels on falling long-term rates, short-covering, buyout speculation and investment manager performance anxiety.