Stocks Higher into Final Hour on Positive Earnings Reports, Buyout Activity

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Internet longs, Computer longs, Biotech longs and Retail longs. I added Goldman Sachs(GS) long and added to a few shorts this morning, thus leaving the Portfolio 100% net long. The tone of the market is very positive as the advance/decline line is substantially higher, almost every sector is rising and volume is about average. Google (GOOG) is rising 1.9% on its DoubleClick acquisition announcement. I like this deal and think it will further widen the gap between GOOG and the competition if approved. Google remains my largest long position. Stocks have flat-lined higher over the last couple of hours as I sense many are still in disbelief at the market and economy's resiliency. Performance anxiety is likely coming back into play in a big way. Mid-cap stocks continue to trounce the S&P 500 as they sport 8%+ gains already this year. As I have said many times of late, the current environment has been very good for stockpickers and now the major averages seem to be kicking into gear. The underlying tone of the broad market remains very constructive despite so many bears and a large number of bulls who have recently raised cash ahead of earnings reports and the "sell in May” strategy. It is a big positive, as well, to see the financials participate today. The ISE Sentiment Index is plunging 19% to a depressed 99.0 as retail options traders remain very bearish into market strength. This is a market positive. I expect US stocks to trade mixed-to-higher into the close on short-covering, buyout speculation, rising earnings optimism, lower long-term rates and bargain-hunting.