By Robert W. Colby, Senior Analyst TraderPlanet.com

Stocks are very electively Strong and Weak

Bullish sectors: Energy, Industrial, Technology, and Materials.

Bearish sectors: Financial, Utilities, Consumer Discretionary, Health Care, and Consumer Staples.

Stocks ended mixed to higher on Monday, slowing after an 8-day rally.

Trading volume rose, as more traders returned from a holiday-shortened week.

The Advance-Decline balance was moderately Bullish on the NYSE but moderately Bearish on the NASDAQ, where breadth has been lagging for a long time.

Spotlight on event stocks: Here is a stock screen I designed to pick out potential “event” stocks, both Bullish and Bearish. Sometimes, stocks with large changes in price and volume are revealed to be deal stocks, sooner or later, or are the subject of some other extraordinary events, positive or negative.

Bullish Stocks: Rising Price and Rising Volume
% Price Change, Symbol, Name

10.47% , CMI , CUMMINS
4.81% , FDX , FEDEX
4.23% , LVLT , LEVEL 3 COMMUNICATIONS
4.49% , AMZN , Amazoncom Inc
3.69% , TJX , TJX
0.13% , ONEQ , Growth LargeCap NASDAQ Fidelity, ONEQ
3.00% , HOG , HARLEY DAVIDSON
5.28% , PCAR , PACCAR
2.60% , ETN , EATON
4.15% , SNDK , SanDisk Corporation
0.34% , JKH , MidCap Growth iS M, JKH
2.43% , SRE , SEMPRA ENERGY
0.81% , FPX , IPOs, First Tr IPOX-100, FPX
3.71% , COP , CONOCOPHILLIPS
4.24% , EXPD , Expeditors International WA
0.35% , IIH , Internet Infrastructure H, IIH
0.55% , EWN , Netherlands Index, EWN
3.43% , CIT , CIT GROUP
2.75% , CSC , COMPUTER SCIENCE
1.71% , DE , DEERE & CO
2.90% , NVDA , NVIDIA
2.33% , TLAB , TELLABS
0.06% , ELV , Value Large Cap DJ, ELV
4.22% , PBW , WilderHill Clean Energy PS, PBW
1.93% , VRSN , VeriSign Inc
0.74% , RRD , RR DONNELLEY SON
1.29% , BF.B , BROWN FORMAN STK B
0.28% , JKF , Value LargeCap iS M, JKF
1.48% , ETFC.O , E*TRADE FINANCIAL
0.95% , JNJ , JOHNSON&JOHNSON
1.23% , HHH , Internet H, HHH
1.68% , AA , ALCOA
1.75% , PEG , PUBL SVC ENTER
0.26% , RFV , Value MidCap S&P 400, RFV
1.29% , DOW , DOW CHEMICAL
2.87% , ADM , ARCHER DANIELS
0.62% , PKB , Building & Construction, PKB
2.06% , BRCM , BROADCOM STK A
1.09% , EFX , EQUIFAX
1.46% , FLR , FLUOR
0.18% , DSG , Growth Small Cap DJ, DSG
1.89% , NSC , NORFOLK SOUTHERN
1.31% , XLNX , XILINX
0.66% , VIS , Industrials VIPERs, VIS
0.22% , RPV , Value S&P 500, RPV
0.96% , PH , PARKER HANNIFIN
0.80% , HSIC , Henry Schein Inc
0.65% , NTRS , NORTHERN TRUST
1.03% , BA , BOEING
0.34% , MKH , Market 2000 H, MKH

Bearish Stocks: Falling Price and Rising Volume
% Price Change, Symbol, Name

-6.38% , LXK , LEXMARK INTL STK A
-2.38% , MI , MARSHAL & ILSLEY
-2.37% , RHT , Red Hat Inc.
-3.49% , HBAN , HUNTINGTON
-2.43% , BLL , BALL
-3.61% , TYC , TYCO INTL
-1.78% , UST , UST
-1.06% , SYMC , SYMANTEC
-2.65% , URBN , Urban Outfitters Inc.
-0.97% , LNC , LINCOLN NATL
-1.25% , MIL , MILLIPORE
-2.13% , MAS , MASCO
-2.01% , BMC , BMC SOFTWARE
-1.22% , ASH , ASHLAND
-1.61% , BEAS , BEA Systems Inc
-1.34% , EWW , Mexico Index, EWW
-0.73% , SVU , SUPERVALU
-1.98% , UNH , UNITEDHEALTH GRP
-1.03% , KEY , KEYCORP
-0.94% , MYL , MYLAN LABS
-1.22% , BUD , ANHEUSER BUSCH
-1.33% , PETM , PETsMART Inc
-0.63% , BMY , BRISTOL MYERS
-0.45% , KMB , KIMBERLY CLARK
-1.43% , KSS , KOHLS
-2.30% , SSCC , Smurfit-Stone Container Corporation
-0.81% , RFMD , RF Micro Devices Inc
-1.64% , SHW , SHERWIN WILLIAMS
-0.93% , WYE , WYETH
-0.91% , AOC , AON
-2.59% , LTD , LIMITED BRANDS
-1.10% , SWY , SAFEWAY
-0.80% , FITB , FIFTH THIRD BANC
-0.53% , IAH , Internet Architecture H, IAH
-1.06% , LLY , ELI LILLY
-1.44% , VIA.B , VIACOM STK B
-1.27% , CMA , COMERICA
-1.43% , DLTR , Dollar Tree Stores Inc
-0.97% , MAT , MATTEL
-1.29% , CEPH , Cephalon Inc
-1.35% , GPS , GAP
-0.48% , CAG , CONAGRA FOODS
-1.42% , NCC , NATIONAL CITY
-0.37% , IXG , Financials Global LargeCap Value, IXG
-1.47% , CCL , CARNIVAL STK A
-1.44% , VIA , VIACOM INC. (New)
-0.95% , ASD , AMER STANDARD
-0.73% , PXN , Nanotech Lux, PXN
-0.61% , PTV , PACTIV
-0.72% , LAMR , Lamar Advertising Company

Sectors: among the 9 major U.S. sectors, 5 rose, 3 fell, and 1 finished unchanged.
Major Sectors Ranked for the Day
% Price Change, Sector

0.94% Energy
0.75% Industrial
0.57% Technology
0.24% Materials
0.15% Utilities
0.00% Consumer Staples
-0.31% Health Care
-0.37% Consumer Discretionary
-0.41% Financial

Looking beyond the daily fluctuation to the major trends:

Energy (XLE) Bullish. Price made a new high, and relative strength made a new high on 7/9/07. Relative strength has been strong compared to the S&P since 3/12/03. Overweight.

Materials (XLB) Bullish. Price made a new high close, and relative strength made a new high on 7/9/07. XLB has been relatively strong compared to the S&P since 9/27/00. Overweight.

Industrial (XLI) Bullish. Price made a new high close, and relative strength made a new high on 7/9/07. XLI has been relatively strong compared to the S&P since 8/9/06. Overweight.

Technology (XLK) Bullish. Price made a new 6-year high close, and relative strength made a new high on 7/9/07. XLK has been relatively Bullish compared to the S&P since its low on 7/24/06.

Financial (XLF) Bearish. XLF made a new 21-month low relative to the S&P 500. Underweight.

Consumer Staples (XLP) Bearish. XLP has been relatively weak compared to the S&P since 10/9/02. Underweight.

Utilities (XLU) Bearish. XLU has been relatively weak compared to the S&P since 9/20/01. Underweight.

Health Care (XLV) Bearish. XLV made a new 14-month relative strength low and has been relatively weak compared to the S&P since 10/9/02. Underweight.

Consumer Discretionary (XLY) Bearish. XLY has been relatively weak compared to the S&P since 1/5/05. Underweight.

Foreign stocks made a new price high as the U.S. dollar fell again. EFA made a new absolute price high on 7/9/07 and outperformed strongly since 6/13/07. The EFA’s short-term trend is still Bullish. Long term, EFA (the EAFE, international developed country stock markets, ex the U.S. and Canada) outperformed the S&P 500 since 3/19/03.

NASDAQ made another new 6-year price high. The NASDAQ Composite has been relatively strong since 5/17/07 but relatively weak compared to the S&P since 3/10/00.

Growth beat Value. Growth stocks rose more than Value stocks since 5/16/07. Longer term, the major trend of Growth/Value has been mostly Bearish for seven years.

Small Caps fell modestly and underperformed relative to Large Caps since 6/27/07. Longer term, the trend has been more Bearish than Bullish since the Small-Cap relative strength peak on 4/19/06.

Crude Oil formed a one-day Bearish Engulfing Line. The short-term trend is now questionable. The U.S. OIL FUND ETF (AMEX: USO) is still well below its peak at 73.29 on 7/13/06.

Energy stocks outperformed both the USO and SPY on Monday. Long term, since 3/12/03, the stocks in the Energy Select Sector SPDR ETF (XLE) have significantly outperformed crude oil as a commodity as well as the S&P 500. So, the Relative Strength major trend is Bullish for the energy stocks.

Gold rose on on Monday, but on lower trading volume. The GLD trend has turned neutral/sideways over the past month. Longer term, StreetTRACKS Gold Trust ETF (NYSE: GLD), which reflects the market price of gold futures, topped out at 70.2 on 5/12/06, and so has been relatively weak for 13 months.

Silver lagged GLD, and the longer-term trend of SLV relative to GLD looks Bearish. iShares Silver Trust (AMEX: SLV) broke down to a new 6-month low on 6/26/07. SLV sharply underperformed Gold since 6/5/07 and has been mostly underperforming since 12/7/06.

The Gold Miners Index (XAU) made new 12-week high. XAU has been relatively strong, outperforming GLD since 6/26/07. On the other hand, XAU has underperformed GLD since 5/31/1996, so the long-term trend is questionable.

Inflation expectations appear mixed. The ratio of the price of bond TIPS to 10-year U.S. Treasury Notes is up since 1/16/07, but it is down from a peak on 6/22/07.

Bond prices bounced, retracing most of Friday’s loss. Longer term, TLT hit a new 3-year price low on 6/12/07, the lowest since June, 2004. That indicates a very serious major price downtrend and yield uptrend. The main trend is clearly Bearish for iShares Lehman 20+ Year U.S. Treasury Bond ETF (AMEX: TLT).

U.S. dollar moved lower again and remains Bearish long term. The dollar has been heading down since 6/13/07. Longer term, the dollar has been falling most of the time since its peak at 121.29 on 7/5/2001.

Japanese Yen fell again and remains Bearish. On 6/15/07, the Yen fell to its lowest level in more than four years. The Yen has been weak since its peak at 12,625 on 4/19/1995.

Daily Rankings of Major Global Markets, Ranked from Strongest to Weakest of the Day:

1.97% Taiwan
1.73% Singapore
1.45% Hong Kong
1.21% Oil
1.14% Semiconductors
1.07% Gold Mining
0.94% Energy
0.92% Dow Transports
0.81% Australia
0.75% Industrial
0.75% Natural Gas
0.72% Brazil
0.71% South Korea
0.66% Austria
0.62% Italy
0.61% Sweden
0.58% United Kingdom
0.57% Technology
0.56% Commodity Related
0.55% Netherlands
0.54% Airlines
0.53% Disk Drives
0.53% Germany
0.48% Dow Composite
0.38% Chemicals
0.35% 30Y T-Bond
0.34% DOT
0.34% Switzerland
0.33% S&P Small Caps
0.30% Australian Dollar
0.28% Dow Industrial
0.28% AMEX Composite
0.26% Dow Utilities
0.25% Malaysia
0.24% NYSE Composite
0.24% Materials
0.23% British Pound
0.19% Value Line
0.19% Canada
0.16% Oil Services
0.15% S&P 100
0.15% Utilities
0.15% Swiss Franc
0.13% Nasdaq Composite
0.11% Russell 2000
0.11% S&P Mid Caps
0.11% Wilshire 5000
0.10% Russell 3000
0.09% S&P 500
0.09% Russell 1000
0.09% Internet
0.09% Network
0.09% Canadian Dollar
0.07% Belgium
0.06% Paper
0.04% Nasdaq 100
0.02% US Dollar Index
0.02% Japanese Yen
0.01% Euro Index
0.00% Consumer Staples
0.00% France
0.00% Japan
-0.10% Biotechs
-0.10% Insurance
-0.16% Computer Tech
-0.16% Health Care Products
-0.23% Drugs
-0.26% REITs
-0.27% Health Care
-0.27% Broker Dealers
-0.31% Health Care
-0.37% Consumer Discretionary
-0.41% Financial
-0.53% Spain
-0.57% Retailers
-0.64% Hospitals
-0.66% Banks
-0.81% Hardware
-1.28% Mexico

To sum up the current position of the U.S. stock market:

Longer term, the U.S. stock market has shown impressive Bullish resilience since the major low on 10/10/02, more than four years ago. Stock prices have been buoyed by abundant global liquidly (following years of fiscal stimulation, rapid money supply growth, and rising corporate profits), M&A, and earnings comparisons above expectations.

Liquidity driven merger and acquisitions news has been helping to keep the old Bull alive. Both U.S. and foreign corporations hold excess cash after several years of rising profits, and so M&A speculation as well as leveraged buyouts and corporate stock buybacks have provided substantial Bullish stimulus to stock prices. In 2007, mergers and acquisitions are running about 60% ahead of 2006’s record pace, driven by rising stock prices and private-equity funds that raised more than $250 billion for takeovers since the start of 2006. Takeovers are on track to surpass 2006’s all-time high of $3.49 trillion, according to data compiled by Bloomberg.

Conservative earnings estimates also have been useful in keeping the old Bull alive. First quarter 2007 corporate earnings reflected a significant growth slowdown. Nevertheless, earnings were ahead of expectations, which had been lowered to very conservative levels in advance of actual reporting. Managements and Wall Street have learned that investors hate disappointments, so they simply don’t give them any–unless absolutely necessary.

Stocks generally are fully valued to over priced by long-term historical standards. Although that alone does not mean that stocks cannot continue to trend higher, nevertheless, it is good to remember that “no tree grows to the sky.” The cyclical nature of stock prices never really changes, although the turning points are not always easy to predict.