Dow - 48.86    I  Nasdaq - 12.19    I  S&P 500 - 10.28    

Market Wrap
(Briefing):

For the most part U.S. assets fell out of favor Thursday as stocks, bonds and the dollar all lost ground - some more than others.

All things considered stocks had a reasonably good day. Losses were relatively modest in scope, which is noteworthy considering that the S&P 500, entering Thursday's session, was up 3.0% for the week and up 5.3% from its September 10th close. Its 0.7% decline Thursday, then, shouldn't cause any undue alarm as the move was little more than a profit taking effort following the strong run.

Disappointing earnings news from Circuit City (CC 8.67, -1.90) and FedEx (FDX 104.45, -3.06) provided an excuse for the selling interest, as did the dollar's weakness, which helped drive up commodity prices and long-term interest rates.

The weak dollar showing (-0.9%) was attributed to a London newspaper's report that Saudi Arabia might de-link its currency from the dollar.

Whether one believes that or not, it was a catalyst that left currency traders, who were already in a bearish mood after the Fed's rate cut, thinking more bearish thoughts on the dollar. The euro for its part hit an all-time high against the dollar while the Canadian loonie reached parity with the dollar for the first time since 1976.

Little was made of the boost the weak dollar will provide to earnings for multinational companies or the stock market's strong run since 2003 that occurred as the dollar steadily declined. That goes to show there was some one-sided thinking Thursday, which is understandable given the stock market's big gains of late.

The weakness in the dollar took a heavy toll on the Treasury market where the 10-year note dropped more than a point, bringing its yield up to 4.70%. Better than expected initial claims data and a stronger than expected Philly Fed Index, which is a regional manufacturing report, sucked more wind out of the Treasury market which had been staring at a 10-year note yield of 4.32% less than two weeks ago.

The jump in market rates, combined with the spike in the price of oil (+$1.39 to $83.32) and other commodities, held stocks in negative territory for almost the entire session.

The financial (-1.7%) and consumer discretionary (-1.5%) sectors bore the brunt of Thursday's selling efforts. Keep in mind, though, that they have been two of the best-performing areas in the past week or so. In other words, they were due for a pullback.

A remarkably strong earnings report from Goldman Sachs (GS 203.53, -1.97) offered some early support, but the investment bank failed to hold its gain as it retreated with the broader market in the afternoon trade. Industry peer Bear Stearns (BSC 115.46, -0.18) had a lousy report, but its stock held up on the notion that the bad news was already in the price. Like Goldman, Bear Stearns surrendered its earlier gains to finish with a slight loss.

Fed Chairman Bernanke and Treasury Secretary Paulson were on Capitol Hill Thursday testifying on the mortgage market. Neither said anything surprising, so their remarks didn't have any real impact on Thursday's trading.

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

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Today's Picks - September 21 2007

1.   PAAS - Pan American Silver Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-21-07		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 28.81

2.   FRO - Frontline Ltd

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-21-07		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 48.05

3.   GSF - GlobalSantaFe Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-21-07		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 76.52

Previous Trades

STKL - SunOpta Inc

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

ADSK - AutoDesk Inc

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

CNQ - Canadian Natural Resources

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-20-07	09-20-07	Short	73.64	72.09	Closed Above 75.33	up to - $1.76 per share (73.33 LOT)
	* 09-20-07 - stock gapped up

SLB - Schlumberger

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-19-07		Long	106.61	108.20	Below 105.42	up to + $1.47 per share (108.08)

SYNA - Synaptics Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-18-07	09-20-07	Long	47.02	Reached (47.80)	Closed Below 47.35	up to + $1.93 per share (48.95)

AMT - American Tower Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-18-07		Long	41.10	Reached (42.06)	Below 41.08	up to + 98 cents per share (42.08)

SIGM - Sigma Designs Inc

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-18-07		Long	47.70	Reached (48.26)	Below 49.12	up to + $4.66 per share (52.36)

HCBK - Hudson City Bancorp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
09-14-07	09-20-07	Long	14.65	Reached (14.69)	Closed Below 15.32	up to + $1.01 per share (15.66)