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Market Wrap
(Briefing):

The stock market had a good day on Tuesday with the major indices scoring sizable gains in a low volume rally that saw 1.3 billion shares change hands at the NYSE.

The low volume reflected a sense of reserve ahead of next week's FOMC meeting, but nontheless, profits are just as green on a low volume day as they are on a high volume day. They were all the more pleasing Tuesday, too, considering it was the sixth anniversary of the 9/11 attacks.

The bullish outing was marked by participation from all ten economic sectors, each of which gained more than 1.0% thanks to an added buying push in the last 15 minutes of trading.

The energy sector (+1.8%) played a key role in the surge as stocks in that space, which were sluggish early in the day, surged in the afternoon as crude futures closed at a new record high ($78.23) after OPEC agreed to raise its production levels by 500,000 barrels per day.

While the increase might normally be construed as bearish for oil prices, it was spun as a disappointing increase relative to whisper estimates among traders that called for an increase of at least 1 million barrels per day.

The uptick in energy prices, however, didn't disrupt the broader market which was driven by the prevailing view Tuesday that the global economy should hold up fine despite the problems in the U.S. housing market. An upbeat sales report from McDonald's (MCD 51.76, +1.61), an encouraging third quarter outlook from Ericsson (ERIC 38.26, +2.01), and a narrowing trade deficit for July contributed to that view.

With volume as light as it was, though, we'd caution against reading too much into Tuesday's rally. To be sure, if the market trades down on Wednesday, the prevailing excuse will be that participants are concerned about the pace of global economic growth because of the U.S. housing market and the jump in oil prices.

For the time being, though, the emphasis on Tuesday was on the positives. That's why the market all but looked past a New York Post report that indicated Countrywide Financial (CFC 16.88, -0.33) is seeking another cash infusion that rivals the $2 billion investment made by Bank of America (BAC 49.45, +0.49) last month.

Countrywide was a weak spot in an otherwise solid financial sector (+1.3%) which performed in line with the broader market.

Separately, Fed Chairman Bernanke gave a speech Tuesday on global imbalances. His remarks didn't touch on the current economy or the interest rate outlook, so the market managed to take his comments in stride. Sticking to his appointed topic, Bernanke noted that the U.S. current account gap can't last forever and that there is still a global savings glut.

Looking to Wednesday there aren't any key earnings reports scheduled. A mid-quarter update tonight from Texas Instruments (TXN 35.72, +0.50), however, should act as a trading catalyst. The economic calendar, meanwhile, is bare with the exception of the Dept. of Energy's weekly inventory report at 10:30 ET.

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

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Today's Picks - September 12 2007

1.   NOV - National Oilwell Varco

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-12-07		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 137.50

2.   CAM - Cameron International

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-12-07		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 87.67

3.   SMTC - Semtech

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-12-07		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 18.52

4.   BIDU - Baidu.com Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-12-07		Long	Above 15 high by 21 cents	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 227.40 by 21 cents

Previous Trades

STLD - Steel Dynamics

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-11-07	09-11-07	Long	42.33	Reached (42.72)	Closed Below 42.33	up to + $1.08 per share (42.77)

IPG - Interpublic Group of Companies

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

ADCT - ADC Telecommunications

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-11-07		Long	20.81	21.06	Below 20.41	up to + 17 cents per share (20.98)

PCLN - Priceline

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	* did not setup

PH - Parker Hannifin

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-10-07	09-11-07	Short	104.92	Reached (103.38)	Closed Above 104.92	up to + $1.82 per share (103.10)
	* 09-10-07 - stock gapped up.

AKS - AK Steel Holding

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-10-07		Short	38.68	Reached (37.76)	Above 39.40	up to + $1.50 per share (37.18)
	* 09-10-07 - stock gapped up. * 09-11-07 - the stock gapped up past our stop at the open forcing us to set an emergency stop just above 39.40 (15min high). The emergency stop held, keeping us in the trade.

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 134.80	up to + $10.18 per share (129.85)
	* 09-06-07 - stock gapped up