Monday Close

S&P 500 1,114.02 +.53%
NASDAQ 1,936.52 +1.31%

Leading Sectors
Software +2.37%
Boxmakers +1.93%
Biotech +1.69%

Lagging Sectors
Iron/Steel -1.46%
Oil Service -1.71%
Airlines -2.25%

Other
Crude Oil 53.54 -.24%
Natural Gas 6.80 -.09%
Gold 418.40 +.19%
Base Metals 113.12 -1.23%
U.S. Dollar 87.02 -.08%
10-Yr. T-note Yield 4.05% -.14%
VIX 14.71 -2.19%
Put/Call .77 -12.50%
NYSE Arms 1.03 -26.43%

After-hours Movers
CKFR +5.63% after beating 1Q estimates and raising 2Q forecast.
TXN +5.07% after beating 3Q estimates, reiterating 4Q guidance and making positive comments.
LF -36.81% after cutting 3Q/04 forecast.
CGNX -7.03% after meeting 3Q estimates and lowering 4Q outlook.

Recommendations
Goldman Sachs upgraded MMM to Outperform. Goldman reiterated Underperform on DJ and Outperform on DEX, BBY, KO.

After-hours News
U.S. stocks finished higher today as energy prices declined and investors became more optimistic on technology shares. After the close, International Business Machines said third-quarter sales rose to $23.4 billion from $21.5 billion in the same period a year earlier, Bloomberg said. Texas Instruments said profit rose to $563 million as third-quarter sales reached their highest point for the period in nine years, Bloomberg reported. Lockheed Martin called on the U.S. Air Force to cancel at least four contracts worth more than $6 billion awarded to Boeing after a former Pentagon official told federal prosecutors she improperly favored Boeing, Bloomberg said. The FDA plans to meet with outside medical advisers as early as January to discuss any questions about the safety of Pfizer's painkillers, Celebrex and Bextra, Bloomberg said. Robert Mondavi said it is considering an unsolicited offer to buy the company, Bloomberg reported. Marsh & McLennan said the payments it will forgo because of a lawsuit by New York Attorney General Spitzer amounted to $845 million, or 7% of revenue last year, Bloomberg reported.

BOTTOM LINE: The Portfolio finished substantially higher today on strength in my wireless, internet and telecom equipment longs. I added a few new longs from various sectors in the afternoon, leaving the Portfolio 125% net long. One of my new longs is KMRT and I am using a $89.25 stop-loss on this position. The tone of the market improved throughout the afternoon as technology stocks outperformed and the advance/decline line improved. It is quite possible the large 4Q rally I thought would begin within the next 10 days has already begun. However, I am not ruling out the possibility of one more pull-back in the near-term. I continue to believe the major U.S. indices will post double digit returns for the quarter as economic growth accelerates, political uncertainty and negativity subsides, domestic terrorism fears diminish, interest rates remain low, inflation stays contained and energy prices fall. Technology stocks should continue to outperform in this environment.