Stocks Mixed into Final Hour Ahead of Quarter's End

BOTTOM LINE: The Portfolio is slightly lower into the final hour on losses in my Telecom long and Retail longs. I covered my(IWM) and (QQQQ) hedges into afternoon weakness, thus leaving the Portfolio 100% net long. The tone of the market is negative as the advance/decline line is lower, sector performance is mixed and volume is about average. Overall, economic data has improved modestly of late, notwithstanding fears by many over an economic hard landing. Oil is $5 higher since the Iranian/UK situation began, which is a rather muted reaction, and commercials continue to build their net short position into recent strength. Moreover, the price of gold has a very high correlation with oil. However, the two have diverged in price of late. Natural gas inventories fell -22 bcf this week versus estimates of a -19 bcf withdrawal. Supplies are now 21.5% above the five-year average for this time of year and poised to hit record highs barring any significant disruptions. I expect US stocks to trade modestly higher into the close on short-covering and bargain-hunting ahead of quarter’s end.