Stocks Slightly Higher into Final Hour on Lower Long-term Rates and Buyout Activity

BOTTOM LINE: The Portfolio is slightly higher into the final hour on gains in my Medical longs, Internet longs and Computer longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is slightly negative as the advance/decline line is mildly lower, sector performance is mixed and volume is about average. Reuters is reporting that U.S. refiners nixed expansion plans over the last year that would have added 500,000 barrels per day to production. The refiners cited demand uncertainty and costs, according to Briefing.com. This news will likely result in even more intense scrutiny of the business, considering the recent historical rash of nationwide refinery "outages." Refinery “problems” have been the driving force behind record gas prices and have been propping up the entire complex, in my opinion. I continue to believe this will result in an even greater decline in energy prices before year-end as traders anticipate lower demand and greater production. It is interesting to note that insider selling in US stocks remains muted into recent market record highs. In fact, according to CNBC, insider buying was the strongest in May vs. any month over the last 12. May saw insider purchases of $476,800,864 worth of shares. As well, net insider sales are nowhere near levels normally associated with meaningful market tops, according to sentimentTrader.com. This is another large positive even as the herd remains historically bearish given DJIA record highs. I expect US stocks to trade modestly higher into the close from current levels on buyout speculation, lower long-term rates, short-covering and investment manager performance anxiety.