Moving Slowly Back Into Internets 12-12-05

Good Afternoon.

The stock market has been acting lethargic today despite strength in some of the Asian markets. Some morning strength has been slowly faded but not terribly so. Although Bulls generally enjoy a strong perky market a little flat action to digest Friday's gains going into the Fed meeting tomorrow is ideal.

Oil is up on reports of colder than expected weather in the North East as well as announcements that OPEC will be maintaining production quotas. Gold continues to rally and has clearly drawn the interest of momentum traders. The anticipation of a Fed pause after a long reign of Fed hikes is very Bullish for the Gold Bugs. We ourselves would consider adding some Gold Mining plays after the recent gains are digested. Names that we would consider would be Newmont Mining (NEM), Placer Dome (PDG), and Pan American Silver (PAAS).

Despite the tepid response from today's Bulls there are some pockets of strength in individual positions that we own. Intel (INTC), Ingram (IM), Sunrise Senior Living (SRZ), and Qualcomm (QCOM) are all catching some bids. We would expect a little more upside action in these names should the broader averages perk up towards the close.

Interestingly the internet sector is showing signs of stability recently. Readers will recall that we lightened up our internet exposure over the last couple of weeks. Due to the fact that this group seems to have consolidated in a fashion that we had hoped for we decided this past Friday to slowly scale back into some of our favorite names within the group. In fact Google's (GOOG) increased price target at CSFB to $475 may prove to be a minor turning point for it to start recapturing the upside. Be aware that coming out of recent consolidation may still provide nervous volatility around current levels for the group. Therefore we recommend scaling exposure back into this group on a slow methodical basis.

Currently our portfolio's are over 100% net long and we are maintaining our Bullish bias into Year End.

This will be out last post of the day.

Hope you're doing well. See you tomorrow.

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