Tuesday, July 25, 2006

Stocks Finish Near Session Highs on Lower Energy Prices, Positive Earnings, Short-covering and Bargain Hunting

Indices
S&P 500 1,268.88 +.63%
DJIA 11,103.71 +.48%
NASDAQ 2,073.90 +.58%
Russell 2000 697.44 +.97%
Wilshire 5000 12,704.13 +.74%
S&P Barra Growth 585.17 +.56%
S&P Barra Value 682.24 +.71%
Morgan Stanley Consumer 619.68 +.49%
Morgan Stanley Cyclical 781.40 +1.12%
Morgan Stanley Technology 461.69 +.15%
Transports 4,488.29 -1.76%
Utilities 433.73 +.39%
Put/Call .67 unch.
NYSE Arms .78 +49.14%
Volatility(VIX) 14.85 -.87%
ISE Sentiment 133.00 -2.92%
US Dollar 86.66 +.37%
CRB 340.74 -.57%

Futures Spot Prices
Crude Oil 73.84 +.12%
Unleaded Gasoline 228.55 +.03%
Natural Gas 6.42 +.23%
Heating Oil 195.04 +.33%
Gold 619.00 +.16%
Base Metals 222.01 +2.87%
Copper 346.10 unch.
10-year US Treasury Yield 5.06% +.36%

Leading Sectors
Steel +4.16%
Oil Service +3.37%
Telecom +2.31%

Lagging Sectors
Gaming +.08%
Hospitals -.19%
Broadcasting -.39%

Evening Review
Detailed Market Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
Real-time/After-hours Stock Quote
In Play

Afternoon Recommendations
Oppenheimer:
- Rated (LTM) Buy, target $50.

Afternoon/Evening Headlines
Bloomberg:
- The US dollar gained the most in more than a week against the euro and yen after a report showed US consumer confidence unexpectedly rose in July.
- Crude oil fell a $1.40/bbl. on speculation that the conflict between Israel and Hezbollah won’t spread in the Middle East.
- Amazon.com(AMZN) said second-quarter profit fell after it increased spending on technology and content and lost a lawsuit filed by former partner Toys “R” Us.
- Hewlett-Packard(HPQ) agreed to buy Mercury Interactive(MERQ) for about $4.5 billion.
- Corning Inc.(GLW) said second-quarter profit more than tripled, however the shares dropped after the company’s forecast fell short.

CNBC:
- Dow Chemical’s(DOW) CEO said the economy is roboust.

BOTTOM LINE: The Portfolio finished higher today on gains in my Semi longs, Biotech 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 positive today as the advance/decline line finished higher, almost every sector rose and volume was slightly above average. Measures of investor anxiety were mostly higher into the close. Overall, today's market performance was bullish. The Johnson Redbook same-store sales index rose 2.6% year over year last week vs. a 2.9% rise the prior week. The long-term average is again of around 2.8%. I continue to see little evidence that a significant decline in consumer spending is beginning, even as investors continue to price this into stocks. I still expect retail sales to stabilize around current average levels over the intermediate term.

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