MId-day Update

S&P 500 1,171.89 -.99%
NASDAQ 2,077.87 -1.26%

Leading Sectors
Oil Service +1.51%
Energy +.93%
Commodity +.53%

Lagging Sectors
Homebuilders -2.54%
Semis -2.60%
Airlines -3.20%

Other
Crude Oil 47.70 +3.20%
Natural Gas 6.87 -.04%
Gold 447.80 +1.13%
Base Metals 118.03 -1.40%
U.S. Dollar 83.05 -.76%
10-Yr. T-note Yield 4.19% +1.96%
VIX 13.55 +4.47%
Put/Call .93 +52.46%
NYSE Arms 1.37 +47.31%

Market Movers
OSIP -9.0% after CSFB analyst Mark Augustine said estimates for Tarceva sales are unrealistically high and reiterated his underperform.
TASR -7.7% on Business Week report of insider selling.
NVDA +4.6% after it signed a multi-year agreement to cross-license some patents with INTC.
PLAY +55.6% on strong demand for IPO.
INCX +25.1% after beating 3Q estimates and raising 4Q outlook.
SRNA +18.5% after beating 3Q estimates and raising 4Q guidance.
ADSK +7.5% after beating 3Q estimates, eliminating dividend, announcing 2-for-1 split and boosting guidance.
ATU +7.1% after agreeing to buy Key Components from an investor group.
MMS +10.2% on Legg Mason upgrade to Buy.
JLG -14.9% after lowering 2005 estimates and CSFB downgrade to Neutral.
BCSI -11.3% after missing 2Q estimates and lowering 3Q guidance.

Economic Data
None of note.

Recommendations
-Goldman Sachs reiterated Outperform on INTC, MRVL, DNA, DIS, FSH, PETC, PG. Goldman downgraded MU, AMAT, AEIS to Underperform. Goldman raised NSM to Outperform.
-Citi SmithBarney upgraded RSH to Buy, target $40. Citi reiterated Buy on WYE, target $44. Citi reiterated Buy on G, target $48. Citi downgraded ANN, LTD and TLB to Sell. Citi reiterated Buy on UNM, target $20. Citi reiterated Buy on GE, target $38. Citi reiterated Buy on PETC, target $42.
-JP Morgan downgraded IRM to Underweight. JP Morgan rated MYK Overweight.
-UBS cut NCX to Reduce, target $40.
-CSFB cut TMK to Underperform.
-Banc of America rated AMZN Sell.
-Morgan Stanley cut IRM to Underweight, target $27.
-Legg Mason raised MMS to Buy, target $38.

Mid-day News
U.S. stocks are lower mid-day on rising oil and interest rates. Bank of France Governor Noyer said the central bank will sell 500 to 600 tons of gold over the next five years and increase reserves denominated in currencies to improve revenue and pay a higher dividend to the state, Bloomberg said. Pennsylvania's Senate approved a bill that would require utility companies to use alternative energy sources to generate 18% of the state's electricity by 2020, the AP reported. The median price of a home in the San Francisco Bay Area climbed to $552,000 in October, the San Francisco Chronicle reported. San Francisco International Airport expects to serve 840,000 travelers during Thanksgiving, the busiest holiday for the airport since 2000, the San Francisco Chronicle reported. Russia plans to auction control of OAO Yukos Oil's main business for as little as $8.6 billion to collect back taxes, threatening to bankrupt the country's biggest oil exporter after a 16-month dispute, Bloomberg reported. Oracle CEO Ellison probably won enough support among PeopleSoft investors to press on with his 17-month fight to buy the business-management software company, Bloomberg said. The dollar fell to its lowest in more than four years against the yen and dropped versus the euro after Fed Chairman Greenspan said foreign investors will tire of financing the record current-account deficit, Bloomberg reported. Crude oil is rising as bad weather disrupted tanker shipments from southern Iraq and attacks on pipelines threatened to slow exports from the north, Bloomberg said. Dolby Labs, the developer of a music and motion picture sound system that won Academy Awards, said it plans to raise $460 million by selling shares to the public for the first time, Bloomberg said.

Bottom Line: The Portfolio is slightly lower mid-day as my declining semi and software longs are more than offsetting my rising oil service and Russian ADR longs. I have not traded today and the Portfolio remains 100% net longs. Option expiration, rising oil and profit-taking are the main culprits behind today's losses. The declining dollar is not of great concern at this point as interest rates remain very low by historic standards. Those that missed the recent rally should use any weakness over the next few days to add long exposure. I continue to believe equities will extend recent gains as economic data show acceleration this quarter. I expect U.S. stocks to rise modestly into the close on short-covering and bargain-hunting.

Friday Watch

Earnings of Note
Company/Estimate
DWSN/.38
CHP/.10
SJM/.74

Splits
SSD 2-for-1

Economic Data
None of note.

Recommendations
Goldman Sachs reiterated Outperform on FSH, SYMC, DNA, NKE and Underperform on DDS, UNM. TheStreet.com(TSCM) shares may rise after Dow Jones agreed to buy MarketWatch.com, Business Week reported.

Late-Night News
Asian indices are mostly lower, led down by South Korea. OMI Corp., a NY-listed oil tanker owner, said it won't bid a second time for competitor Stelmar Shipping, TradeWinds reported. Short sellers of Kmart Holding and Sears Roebuck stock helped boost the companies' share prices yesterday, the Wall Street Journal reported. Allegations of anti-competitive practices against some individuals in the U.S. should not be applied to the whole of the insurance market, the Financial Times said. Texas Instruments and rival Qualcomm said they aim to make their first chips in China, the world's biggest handset market, as early as next year, Bloomberg reported. Citigroup invested $6.8 million for Yasser Arafat, Palestinian Authority documents show. At the same time, the late Palestinian leader was paying militants and channeling Authority funds into his personal accounts, Bloomberg reported. European drug stocks may fall after a U.S. health official said AstraZeneca Plc's Crestor cholesterol reducer and GlaxoSmithKline Plc's Serevent asthma drug need close safety reviews, Bloomberg said. Crude oil futures may extend four weeks of declines, a Bloomberg survey shows, after producer and consumer groups cut estimates for global demand and inventories rose in the U.S., Bloomberg reported. U.S. companies such as FedEx Corp. and NY Life Insurance are pleading with President Bush to start discussions on a Pacific Rim free-trade bloc as he heads to this weekend's regional economic summit, Bloomberg said.

Late-Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated -.11%.
NASDAQ 100 indicated -.19%

BOTTOM LINE: I expect U.S. equities to open modestly higher and trade mixed into the afternoon. The market will likely end the week relatively flat, however I expects U.S. stocks to begin moving higher again next week. The Portfolio is 100% net long heading into tomorrow.

Thursday Close

S&P 500 1,183.55 +.14%
NASDAQ 2,104.28 +.22%

Leading Sectors
Oil Service +2.43%
Semis +1.32%
Energy +.92%

Lagging Sectors
Retail -.60%
Drugs -1.28%
Iron/Steel -1.34%

Other
Crude Oil 46.22 unch.
Natural Gas 6.83 -.63%
Gold 442.50 -.09%
Base Metals 119.70 +.91%
U.S. Dollar 83.87 +.70%
10-Yr. T-note Yield 4.11% -.37%
VIX 12.98 -1.74%
Put/Call .61 -6.15%
NYSE Arms .93 +24.0%

After-hours Movers
MRVL +6.4% after beating 3Q estimates.
ADSK +6.7% after beating 3Q estimates, eliminating dividend, announcing 2-for-1 split and boosting guidance.
UNM +7.4% after settling with state and federal regulators who were investigating allegations the company improperly stopped paying benefits to clients.
SRNA +10.7% after beating 3Q estimates and raising 4Q guidance.
INCX +17.31% after beating 3Q estimates and raising 4Q outlook.
SIRI +18.2% after naming former Viacom President Mel Karmazin CEO.
BCSI -11.0% after missing 2Q estimates and lowering 3Q guidance.
LONG -6.46% after disappointing 3Q results.

Recommendations
Goldman Sachs reiterated Underperform on MMC, UNM and Outperform on ENH, DIS, DKS. BioLase Technology(BLTI), which makes laser dental and cosmetic systems, is luring investors following changes in its management and the introduction of a new product, Business Week reported. Tractor Supply(TSCO) shares may rise after the company increased prices in response to higher costs of fuel, steel and freight, Business Week reported.

After-hours News
U.S. stocks finished modestly higher today on led by a rebound in semiconductor shares and strength in the energy sector. After the close, Nike founder Phil Knight resigned as president and CEO of the company, the Wall Street Journal reported. Sirius Satellite Radio name former Viacom President Karmazin as CEO, Ad Age reported. Matsushita Electric, NEC and NTT DoCoMo have developed an operating platform using Linux for 3G phones, the Financial Times reported. Most German companies with U.S. stock market listings would like to quit the NYSE due to the increased cost of complying with U.S. regulations, the Financial Times said. Formosa Plastics' two naphtha cracking plants in Texas shut from Nov. 16 because of power outage, causing U.S. ethylene prices to rise by $50/ton, the Economic Daily News said. China's central bank my raise interest rates again as rising costs of steel, fuel and other raw materials stoke inflation concern, the Hong Kong Economic Journal reported. HannStar Display President Ding-hui expects the flat panel display industry to recover as early as March next year after clients digest their inventories, the Commercial Times reported. Disney said fiscal fourth-quarter profit rose 24% as its ESPN cable sports network boosted results, Bloomberg said. Genentech and OSI Pharmaceuticals said their Tarceva lung cancer drug won U.S. Food and Drug Administration approval. Vodafone, Telefonica SA, BT Group and France Telecom pledged to increase dividends and share buybacks, Bloomberg reported.

BOTTOM LINE: The Portfolio finished higher today on strength in my semi, oil service, wireless, RFID and telecom equipment longs. I did not trade in the afternoon, thus leaving the Portfolio 100% net long. The tone of the market improved into the afternoon. Technology shares continue to display bottoming characteristics. The Bears must be very disappointed that AMAT's results were unable to send semis lower. Moreover, after-hours action bodes well for tech stocks tomorrow. I would still like to see measures of investor anxiety rise from current levels. Hopefully this will happen shortly to set table for another significant move upwards I foresee over the coming weeks.

Mid-day Update

S&P 500 1,182.59 +.05%
NASDAQ 2,099.27 -.02%

Leading Sectors
Oil Service +.91%
Airlines +.77%
HMOs +.40%

Lagging Sectors
Retail -.58%
Iron/Steel -1.31%
Broadcasting -1.62%

Other
Crude Oil 45.75 -2.33%
Natural Gas 6.85 -5.95%
Gold 441.10 -.90%
Base Metals 119.70 +.91%
U.S. Dollar 83.89 +.71%
10-Yr. T-note Yield 4.13% +.09%
VIX 13.06 -1.14%
Put/Call .69 +6.15%
NYSE Arms .86 +14.67%

Market Movers

Economic Data
Initial Jobless Claims for last week were 334K versus estimates of 330K and 337K the prior week.
Continuing Claims were 2792K versus estimates of 2800K and 2808K prior.
Leading Indicators for October fell .3% versus estimates of a .1% fall and a .3% decrease in September.
Philadelphia Fed. for November fell to 20.7 versus estimates of 23.1 and a reading of 28.5 in October.

Recommendations

Mid-day News

Bottom Line: The Portfolio is modestly higher mid-day on gains in my wireless and RFID longs. I have not traded today and the Portfolio remains 100% net long. The tone of the market is mildly negative as most stocks are falling on lighter volume. I am not paying too much attention to most economic numbers at this point due to the fact that most still reflect pre-election worries. I expect data to show U.S. economic acceleration within the next few weeks. Stocks will likely trade mixed into the close as falling energy prices offset economic worries. As well, measures of investor anxiety are still showing too much complacency.

Thursday Watch

Earnings of Note
Company/Estimate
ARO/.54
ADSK/.34
CLE/.29
DKS/.04
DITC/.27
ELBO/.29
GPS/.28
LTD/.10
MRVL/.21
NOVL/.05
VIP/1.94
DIS/.17
WSM/.23

Splits
FINL 2-for-1

Economic Data
Initial Jobless Claims for last week estimated at 330K versus 333K the prior week.
Continuing Claims are estimated at 2800K versus 2813K prior.
Leading Indicators for October are estimated down .1% versus a .1% decline in September.
Philadelphia Fed. for November estimated at 23.1 versus 28.5 in October.

Recommendations
Goldman Sachs reiterated Outperform on DHR, DO, RIG, XRX, AHC, DVN, MUR, NFX, PXD, SUN, XOM and Underperform on CVH.

Late-Night News
Asian indices are quietly mixed on a continuing consolidation of recent gains. Saddam Hussein diverted money from the UN oil-for-food program to pay millions of dollars to families of Palestinian suicide bombers who carried out attacks on Israel, the Sidney Morning Herald reported. Reuters Group Plc, the world's biggest publicly traded provider of financial information, may say it will start a fixed income trading system, the Financial Times said. European governments must cut bureaucracy to encourage drug development and accept the price they pay for medicines, the Financial Times said, citing a World Health Organization report. The U.S. and Australia won a trade complaint against European Union rules that protect traditional food names such as "feta" cheese and "Parma" ham, Bloomberg said. Iran must understand it is time to help Iraq as its neighboring country prepares to hold elections in January, U.S. Secretary of State Colin Powell said.

Late-Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated -.16%.
NASDAQ 100 indicated -.41%

BOTTOM LINE: I expect U.S. equities to open modestly lower and trade mixed into the afternoon. The Portfolio is 100% net long heading into tomorrow.

Wednesday Close

S&P 500 1,181.94 +.55%
NASDAQ 2,099.68 +1.01%

Leading Sectors
Semis +2.86%
Disk Drives +2.81%
Boxmakers +2.35%

Lagging Sectors
Biotech -.08%
Utilities -.90%
Airlines -1.07%

Other
Crude Oil 46.60 -.51%
Natural Gas 7.27 -.18%
Gold 445.10 unch.
Base Metals 118.62 +1.27%
U.S. Dollar 83.33 -.56%
10-Yr. T-note Yield 4.13% -1.78%
VIX 13.21 unch.
Put/Call .65 -5.80%
NYSE Arms .75 -55.62%

After-hours Movers
NFLX +10.3% after boosting 4Q subscriber growth and revenue estimate.
ISSC +9.8% after strong 4Q results.
HOTT +5.95% after meeting 3Q estimates.
NABI -12.6% after announcing disappointing results from its Phase II clinical trial for Altastaph.
MGAM -9.78% after meeting 4Q estimates and raising 1Q guidance.
CRM -9.3% on profit-taking after beating 3Q estimates and raising 05 guidance.

Recommendations
Goldman Sachs reiterated Underperform on PVH.

After-hours News
U.S. stocks finished higher today on strong economic reports, falling interest rates and optimism in the technology sector. After the close, senior presidential adviser Karl Rove called Nebraska Senator Ben Nelson, a Democrat, a few days ago to ask if he would like to succeed Ann Veneman as Agriculture Secretary, CNN reported. Pakistan's government said India's withdrawal of a first group of soldiers from Jammu and Kashmir with help the peace process between the South Asian neighbors, Agence France-Presse rerpoted. U.S. lawmakers agreed on a plan to ban taxes until 2007 on Internet access provided by companies such as MSN and AOL, Bloomberg said. Medtronic, the world's largest maker of devices that regulate heart rhythm, said fiscal second-quarter profit rose 13% because of higher sales of defibrillators, Bloomberg reported. Applied Materials, the world's biggest maker of semiconductor-production equipment, said fourth-quarter profit rose to its highest level in four years on demand from computer-chip makers for new machines, Bloomberg reported.

BOTTOM LINE: The Portfolio finished higher today on strength in my retail, semi, steel and RFID longs. I exited an internet long in the afternoon and added NTE long, thus leaving the Portfolio 100% net long. I am using a $18.75 stop-loss on this position. The tone of the market deteriorated modestly throughout the afternoon on rising oil prices and profit-taking. However it was still a very good day for the Bulls considering recent gains. I continue to expect U.S. stocks to rally, at least through year-end, as accelerating economic growth results in companies easily beating recently lowered 4Q estimates. Shorts will continue to cover, funds will chase performance and new inflows will result in continued bargain-hunting on the long-side.