Monday, June 07, 2004

Mid-day Update

S&P 500 1,132.60 +.91%
NASDAQ 1,999.80 +1.07%

Leading Sectors
Gaming +4.24%
Homebuilders +2.41%
Semis +2.18%

Lagging Sectors
Restaurants +.14%
Broadcasting -.04%
Biotech -.41%

Crude Oil 38.30 -.49%
Natural Gas 6.20 -.97%
Gold 394.20 +.64%
Base Metals 108.12 +1.75%
U.S. Dollar 88.21 -.37%
10-Yr. T-note Yield 4.77% -.04%
VIX 15.85 -5.42%
Put/Call .66 -33.33%
NYSE Arms .51 -20.31%

Market Movers
MBG +17.44% after announcing its $4.85 billion acquisition by MGG.
IMCL +9.66% after a recent study showed that its Erbitux medicine helped patients with head and neck cancers live twice as long.
LACO +14.2% on takeover speculation.
DW +6.58% after saying it had been ranked in IBD's Top 100.
CRDN +8.65% on continuing speculation that it will win new body armor contracts from the U.S. government.
CBI -9.90% after cutting 2Q and 04 forecasts substantially.
WEBX -9.61% after ThinkEquity cut to Sell.

Economic Data
None of note.

XMSR and SIRI rated Overweight at JP Morgan. BA raised to Overweight at Lehman, target $55. KFY raised to Buy at UBS. MCRL cut to Sell at Bank of America, target $9. Goldman reiterated Outperform on PFE, FON, WMT, AMGN, DNA, BIIB, MDT, CLS, EBAY, AMLN.

Mid-day News
U.S. stocks are broadly higher mid-day on merger activity, falling energy prices and stabilizing interest rates. Primus Telecom is selling a $19.95 a month phone service over the Internet that allows consumers to make unlimited calls in the U.S., Canada and Western Europe, the Wall Street Journal reported. California lawmakers want to crack down on insurance companies that support questionable tax shelters and pay fines for taxpayers who use illegal shelters, the LA Times reported. U.S. and state officials investigating abusive trading in the mutual fund industry will look into whether fund companies paid brokers to push investors towards particular funds, the LA Times reported. The sentencing date for Martha Stewart and her former broker Peter Bacanovic was moved to July 8 from June 17 because of a defense request, CNBC reported. The IMF may raise its forecast for global economic growth amid a continuing vigorous recovery in the U.S. and a stronger-than-expected expansion in Japan, the Financial Times said. McDonalds said global same-store-sales climbed a robust 7.4% in May, Bloomberg reported. Continental Air dropped a round-trip fare increase of as much as $40 after some competitors didn't adopt the higher prices in all markets, Bloomberg reported. A UN resolution on the transfer of power in Iraq from a U.S.-led coalition to an interim government of Iraqis should happen within "the next couple of days or so," Condoleezza Rice said. The NYSE will close Friday to mark the funeral of President Ronald Reagan, Bloomberg reported.

BOTTOM LINE: The Portfolio is up modestly today as my tech longs are rising more than my declining biotech longs. Complacency is starting to creep back into the market as the ARMs, VIX and Put/Call readings are all falling. However, lower energy prices and the decline in interest rates over the last hour should allow stocks to maintain good gains today. I have not traded today and the Portfolio is still 125% net long.

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