Dow - 249.97    I  Nasdaq - 48.62    I  S&P 500 - 25.00    

Market Wrap
(Briefing):

The stock market gapped aggressively lower off the open following the much weaker than expected Non-Farm payroll data. The report rolled in below the flat line (-4K vs. consensus of 110K) for the first time since Aug 2003 (factory firings highest since July 2003) with the last two reports from June and July revised down a combined -81K as well. According to the futures market this locked the odds of an interest rate cut of 25 bp on Sep 18 (50% chance of 50 bp). Note too that flat payroll growth correlates to 2% real GDP growth given the long-term trend of 2% productivity growth. However, uncertainty is never well received in the marketplace and the report has the Street unsure how much the Fed will cut in Sep (GS suggested 50 bp, BSC said 25 bp, Barclay's expecting 75 bp by end of year) while also increasing fear as to how far the housing/subprime/economic woes will be felt now that we have seen evidence in the jobs numbers.

The negativity was not limited to the jobs data as we also saw bearish news/commentary in Semi (NSM, XLNX), Airline (selected downgrades) and Home Construction (BZH). Also of interest, but overshadowed by the jobs report, were statements from former Fed Chair Greenspan suggesting that the current market turmoil is in many ways identical to that which occurred in 1998 and 1987.

Tests of multi-year highs in Gold and multi-year lows in the 10-Yr Yield and the lagging performance in Finance (largest segment of the S&P 500) off of the Aug lows implies that fear/risk are rising. While market internals were firmly negative and volume rose above previous sessions, TRIN (measure of selling pressure) ended at excessively high levels which suggests watching for signs of short term stabilization early next week.

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Trade system guidelines (edited):
Only available to Newsletter Subscribers.

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Today's Picks - September 10 2007

1.   IAR - Idearc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-10-07		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: This stock trades lower volume than our usual picks. * Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 33.21

2.   PH - Parker Hannifin

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-10-07		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	* Please Note: If the stock gaps up at the open do not enter the trade unless it trades below 105.06

3.   AKS - AK Steel Holding

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-10-07		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	* Please Note: If the stock gaps up at the open do not enter the trade unless it trades below 38.75

Previous Trades

MUR - Murphy Oil Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* did not setup

ICE - IntercontinentalExchange Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-06-07		Short	140.03	Reached (138.04)	Above 136.00	up to + $8.41 per share (131.62)
	* 09-06-07 - stock gapped up

SII - Smith International Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
08-31-07	09-07-07	Long	66.49	Reached (67.33)	Closed Below 68.25	up to + $3.17 per share (69.66)

INTC - Intel Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
08-30-07	09-07-07	Long	25.27	Reached (25.51)	Closed Below 25.52	up to + $1.16 per share (26.43)
	* 08-30-07 - stock gapped down * 09-07-07 - the stock gapped down past our stop at the open forcing us to set an emergency stop just below 25.52 (15min low). The emergency stop was then hit, closing the trade.

NOV - National Oilwell Varco Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
08-30-07	09-07-07	Long	123.69	Reached (125.79)	Closed Below 130.26	up to + $11.21 per share (134.90)
	* 08-30-07 - stock gapped down * 09-07-07 - the stock gapped down past our stop at the open forcing us to set an emergency stop just below 130.26 (15min low). The emergency stop was then hit, closing the trade.

MDR - McDermott International

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
08-30-07	09-07-07	Long	91.24	Reached (92.28)	Closed Below 96.28	up to + $8.72 per share (99.96)
	* 08-30-07 - stock gapped down

RL - Polo Ralph Lauren

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
08-29-07	09-07-07	Long	73.29	Reached (74.64)	Closed Below 77.77	up to + $6.61 per share (79.90)
	* 08-29-07 - stock gapped down