S&P 500 1,111.48 +.28%
NASDAQ 1,925.82 +.75%
Leading Sectors
Software +1.73%
Biotech +1.4%
Retail +1.31%
Lagging Sectors
Papers -1.27%
Airlines -1.49%
Oil Service -1.81%
Other
Crude Oil 53.46 -2.69%
Natural Gas 6.79 +1.21%
Gold 417.60 -.60%
Base Metals 113.12 -1.23%
U.S. Dollar 87.10 +.01%
10-Yr. T-note Yield 4.06% +.14%
VIX 14.94 -.66%
Put/Call .79 -10.23%
NYSE Arms 1.16 -17.14%
Market Movers
MMC -8.8% on continuing worries over Spitzer probe.
CHKP +16.4% after beating 3Q estimates and raising 4Q/04 guidance.
MMM -4.4% after missing 3Q estimates, lowering 4Q guidance and Prudential downgrade to Neutral.
ODSY -43.0% after cutting 3Q/04 forecasts and announcing Dept. of Justice civil investigation.
SEM +23.0% after agreeing to be taken private for $1.82 billion excluding debt.
JQH +15.4% after saying it had received a proposal from Barcelo Crestline Corp. to acquire it for $13.00 in cash per class A share.
APOL +4.5% on Morgan Stanley upgrade to Overweight, target $85.
PLMO +7.9% on JP Morgan upgrade to Overweight.
ICUI -16.5% after missing 3Q estimates.
CHE -8.6% and HALTED, boosting forecast, indicated $53-56.
BGG -6.9% after lowering 1Q/05 forecast.
MNC -8.8% after cutting 3Q forecast.
TZOO -5.8% after American Technology downgrade to Sell.
ASD -4.2% after missing 3Q estimates and lowering 4Q forecast.
GIVN -3.7% on negative Barron's mention.
Economic Data
NAHB Housing Market Index for October rose to 72 versus estimates of 68 and a reading of 67 in September.
Recommendations
Goldman Sachs reiterated Outperform on INTC, AMD, MDT, MET, FS and IGT. Goldman reiterated Underperform on EK and FRX. Citi SmithBarney reiterated Buy on MDT, target $62. Citi reiterated Buy on GDT, target $55. Citi reiterated Buy on AMGN, target $90. Citi raised VECO to Buy, target $26. Citi reiterated Buy on FON, target $22. Citi reiterated Buy on L, target $11.50. Citi reiterated Buy on WB, target $53. Citi reiterated Buy on WMT, target $65. Citi reiterated Buy on PEG, target $45. OSUR raised to Outperform at Thomas Weisel, target $11. VRTS rated Outperform at CSFB, target $25. PLMO raised to Overweight at JP Morgan. VRX rated Buy at Merrill Lynch, target $32. PEP raised to Buy at Merrill, target $55. KZL raised to Outperform at Bear Stearns, target $54.
Mid-day News
U.S. stocks are mostly higher mid-day on a decline in energy prices. Kraft Foods is considering selling Oscar Mayer meats and Post cereals, the NY Post reported. Increased terrorist attacks in Iraq are aimed at U.S. President Bush personally, as terrorists seek to keep him from getting re-elected, Russian President Putin said, the Itar-Tass news agency reported. Blue Coat Systems, whose devices thwart computer viruses and filter Internet content, is enhancing its proxy servers with software to block spyware and adware programs, which disrupt computer users' Internet activity, the Wall Street Journal reported. Video-game makers have created a format that allows advertisers to insert changeable information into "virtual billboards" within the game, the Wall Street Journal reported. Fannie Mae's plan to report third quarter earnings by Nov. 15 instead of its typical mid-October timeframe suggests the company will have to restate profit, the Financial Times said. Kojo Annan, the son of United Nations Secretary-General Kofi Annan, is among people and companies under investigation by a federal grand jury looking into the massive corruption in Iraq's $64 billion UN oil-for-food program, the NY Post reported. Lexmark Intl., the No.2 maker of computer printers, said third-quarter profit rose 50% on a tax benefit and sales of higher-profit machines, Bloomberg reported. SynCardia Systems won FDA approval to sell an artificial heart, the first such device available for commercial use in the U.S., Bloomberg said. Kmart Holding named Yum! Brands executive Lewis as CEO, replacing Julian Day, to improve retail operations, Bloomberg said. Harmony Gold Mining made a hostile offer to buy Gold Fields for $8.2 billion in stock to create the world's largest producer of the precious metal, Bloomberg reported. Crude oil is dropping after reaching $55.33/bbl. in NY amid concern that rising prices will reduce the growth of demand for petroleum products, Bloomberg reported.
BOTTOM LINE: The Portfolio is higher mid-day on strength in my wireless, internet and retail longs. I added a few new longs this morning, bringing the Portfolio's market exposure to 100% net long. One of my new longs is ARO and I am using a stop-loss of $28 on this position. The tone of the market is mildly positive. I continue to expect technology stocks to outperform at least through year-end. It is a big positive to see gasoline futures with a significant decline. On the negative-side, measures of investor anxiety are falling and the advance/decline line is relatively weak. I expect U.S. stocks to rise modestly from currently levels into the afternoon on short-covering and optimism over a possible peak in energy prices.
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