Stocks Finished Mixed as Falling Energy Prices Offset Profit-Taking

Indices
S&P 500 1,552.58 -.32%
DJIA 14,043.73 -.16%
NASDAQ 2,787.37 +.25%
Russell 2000 840.14 -.56%
Wilshire 5000 15,621.75 -.31%
Russell 1000 Growth 629.99 -.07%
Russell 1000 Value 865.52 -.57%
Morgan Stanley Consumer 753.06 -.21%
Morgan Stanley Cyclical 1,079.52 -.53%
Morgan Stanley Technology 682.94 +.56%
Transports 4,934.97 -1.24%
Utilities 513.93 -.20%
MSCI Emerging Markets 155.01 -.23%

Sentiment/Internals
Total Put/Call .74 unch.
NYSE Arms 1.33 +143.0%
Volatility(VIX) 17.46 +3.25%
ISE Sentiment 187.0 +32.62%

Futures Spot Prices
Crude Oil $79.03/bbl. -2.70%
Reformulated Gasoline 199.93 -2.44%
Natural Gas 6.88 -2.73%
Heating Oil 215.90 -2.90%
Gold 739.0 -1.10%
Base Metals 245.71 -2.36%
Copper 362.0 -2.83%

Economy
10-year US Treasury Yield 4.64% unch.
US Dollar 78.78 +.60%
CRB Index 323.39 -1.77%

Leading Sectors
Computer Hardware +1.92%
Gaming +1.22%
Restaurants +.96%

Lagging Sectors
Gold -1.43%
Oil Tankers -1.70%
Oil Service -2.02%

Evening Review
Market Performance Summary
WSJ Data Center
Sector Performance
ETF Performance
Style Performance
Commodity Movers
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Commentary
After-hours Movers
After-hours Stock Quote
In Play

Afternoon Recommendations
Deutsche Bank:
- Rated (FISV), (SSS), (EXR) and (JKHY) Buy.

Bank of America:
- Rated (MF) Buy, target $37.

Citigroup:
- Rated (ERTS) Buy, target $75.
- Rated (ATVI) Buy, target $29.

Afternoon/Evening Headlines
Bloomberg:
- Greg Yurek, CEO of American Superconductor Corp.(AMSC) see wind-power growth.(video)
- Sprint Nextel(S) ousted CEO Gary Forsee after he failed to wrest customers from Verizon Wireless(VZ) and AT&T Inc.(T). The stock rose 3% in after-hours trading.
- Yum! Brands(YUM), the owner of the Pizza Hut, Taco Bell and KFC restaurant chains, said third-quarter profit rose 17%, exceeding analysts’ estimates. The stock rose 3.6% in extended trading.
- Crude oil dropped more than $2 a barrel for the first time in almost two months as the dollar rebounded against the euro, reducing the appeal of commodities as an investment and on speculation oil consumption will fall.

New Yorker:
- Victor Niederhoffer closed his main Matador hedge fund last month after losing more than 75% of assets, the second time he’s been forced to liquidate.

NY Post:
- Ellington Capital Management, a hedge fund with $5.2 billion in assets, suspected withdrawals from some accounts because of a decline of liquidity in markets back by mortgages.

CNNMoney.com:
- Ethanol Sales to Exceed Gasoline In Brazil By 2020, according to the CEO of Petrobras.

BOTTOM LINE: The Portfolio finished higher today on gains in my Computer longs, Semi longs, Internet longs and Medical longs. I did not trade in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was slightly negative today as the advance/decline line finished mildly lower, sector performance was mixed and volume was light. Measures of investor anxiety were slightly above average into the close. Today's overall market action was neutral. Many market-leading growth stocks once again posted huge relative gains. Tech was relatively strong, as well, with computer hardware jumping 1.9%. Commodities and housing-related equities were sources of weakness throughout the day. The Retail HOLDRs (RTH) fell 0.2% but finished well off session lows. I wouldn't be surprised to see retail stocks actually rise on upcoming September reports that will likely come in modestly below estimates. Investors may begin looking past near-term weakness and begin factoring in colder weather, lower energy prices, better consumer confidence and the positive effects of rising stocks at a time of record net worth and low unemployment. I suspect this holiday retail selling season will easily exceed dramatically lowered estimates as well. The NYSE Arms finished at a high 1.32 on low volume, which bodes well for the near term. I continue to see meaningful technical breakouts in all market-cap categories of growth stocks. The Financial Times has an interesting interview with Giles Conway-Gordon today, managing director of a hedge fund of funds and a 20-year industry veteran. He says that he expects hedge funds to see $500 billion in redemptions over the next 12 months. Quantitative black-box funds that use massive leverage are especially at risk and many won't survive, he said. His concerns echo comments I have made numerous times over the last year. Many of these "market-neutral" funds have very poor risk-adjusted returns in both up and down markets. As well, a large percentage of these funds were marketed as a way to generate 8% to 12% low-risk gains in what they said was a U.S. secular bear market. Their poor performance, combined with the dying belief in the U.S. secular bear case, will result in substantial outflows over the coming years, in my opinion. I still think a significant portion of this capital will flow into more positively-correlated U.S. stock strategies, which could provide the catalyst for the “mother of all short-covering rallies.”