SAN FRANCISCO -- Clearly, today's session wasn't what most investors had in mind after a long weekend that featured (among more recreational activities) passage of tax-cut legislation. Despite the presumptive catalyst from the tax cut and a stronger-than-expected

consumer confidence

report, declining stocks led advancers and major averages ended mixed.


Dow Jones Industrial Average

rose 0.3% behind strength in

Eastman Kodak




(MRK) - Get Report

, but the

S&P 500

shed 0.8% and the

Nasdaq Composite

lost 3.4%.

Broader averages were scuttled by weakness in tech stocks, particularly big-caps




Sun Microsystems

(SUNW) - Get Report

, which were downgraded by

Goldman Sachs


After the closing bell, Sun Microsystems confirmed Goldman's caution (although not necessarily the continued "recommended list" rating) by

cutting expectations for its fiscal fourth-quarter revenue and earnings. After falling 8.8% to $18.67 in the regular-hours session, Sun was quoted with a bid-ask of about $17.50 in after-hours trading.

But does Sun's warning matter, wondered Bill Fleckenstein, president of

Fleckenstein Capital

in Seattle.

"Again, what is driving the stock market is not reasonable pricing or any really good case for why things get better," he lamented. "It's the hope and belief that stocks should go up again because


is cutting rates and companies are telling us it's the bottom, even if there's no documentation

as to why."

I called the famed short-seller today to get an update for the latest "Accountability Report Card."

Please note, these are first-quarter calls and the performance column assumes an investor held the stocks from the time the call was made through last Friday's close. Given most sources likely altered their portfolios during the intervening period, I've tried to track down as many as possible for an update.

Fleckenstein, for one, covered the shorts recommended here on

March 5 in the wake of the

Federal Reserve's

aggressive rate cuts.

"Nothing has changed fundamentally,

actually things have gotten worse," the hedge fund manager declared. "But when you've got Easy Al spewing out 50 basis-point rate cuts, I have to be more of a trader

and was forced to cover."

Fleckenstein has recently retaken short positions in many of the same names, with the biggest bet being on


(MU) - Get Report


"People think happy days are right around the corner, but they're not," he said, citing the recent suffering of



as evidence "between now and quarter's end it might be safe to be short things that have bad news."

The Update, Please

As for the other sources cited in the table, here's the current thinking of those I was able to reach today (I'll try to catch up with the rest in the coming days):

Thomas McManus of

Banc of America Securities

has tinkered slightly with the 10 stocks recommended above. In March,

Procter & Gamble

(PG) - Get Report



(CLX) - Get Report

. But P&G itself was ousted after the announcement of its Clairol purchase last week and replaced by

Adelphia Communications




Southern Co.

(SO) - Get Report

was replaced by

First Health Group


back in early April.

The portfolio is now a bit more focused on consumer discretionary spending vs. nondiscretionary, but "overall, it's still a defensive allocation approach," said McManus, whose macro concerns were recently detailed


Howard Rosencrans of

HD Brous

has not covered any of the four short positions recommended on

Jan. 23, including

Idexx Laboratories

(IDXX) - Get Report

, one short that most hurt his performance.

"I don't think they can make the numbers this year," he said matter-of-factly. "I see a significant shortfall

vs. earning estimates and a pronounced falloff in the stock price."

As for the others, Rosencrans concurs with

Doug Kass regarding

AOL Time Warner


, believes

Symbol Technologies


uses "aggressive accounting" and feels


(CTAS) - Get Report

is vulnerable because of its sensitivity to employment trends that are "going the wrong way."

Regarding the macro outlook, he believes the major averages will avoid "pronounced erosion" through the summer but still believes it's a bear-market rally, rather than a new bull market.

Scott Bleier of

Prime Charter

is sticking with the stocks mentioned above (in separate columns), save for





(CBT) - Get Report

. He also noted



performance isn't as bad when gains from the

Rainbow Media

(RMG) - Get Report

spinout are included.

As for new favorites, Bleier recommends


(VZ) - Get Report

, but expects the overall market to be range-bound for much of the summer.

"Traders are looking for breakouts, but they're not going to get 'em," he said,

Stanley Nabi of

Credit Suisse Asset Management

remains enamored of energy stocks, but is "not prepared to be as aggressive" today on names such as

Phillips Petroleum


, which have had big gains. He sees more upside for oil service names such as

Transocean Sedco Forex

(RIG) - Get Report


Rowan Cos.



He believes financials will soon start to benefit from lower interest rates, despite fears about nonperforming assets and the possible end of the Fed's easing cycle. He continues to recommend the financials mentioned on

Feb. 27 and today added

U.S. Bancorp

(USB) - Get Report

to the list.

Finally, pharmaceuticals will soon start becoming attractive if they continue to be "traumatized over what's happening in Washington," Nabi said, citing

Bristol-Meyers Squibb

(BMY) - Get Report

as a favorite.

Kent Engelke of

Anderson & Strudwick

still likes the small, regional banks mentioned above and today named two more:

Independent Community Bankshares



International Bancshares

(IBOC) - Get Report


Finally (for today), Dwight Anderson of the

Ospraie Funds

has exited from


(WMC) - Get Report


Murphy Oil

(MUR) - Get Report


Occidental Petroleum

(OXY) - Get Report

because the stocks hit his (upside) targets.

Ospraie remains long the remaining names, save


(MEOH) - Get Report

, which Anderson said was sold because of fundamental concerns.

As for new recommendations,

Public Service Enterprise

(PEG) - Get Report

is the only one the hedge fund manager is "passionate" about. Anderson believes the utility can comfortably beat earning estimates for both 2001 and 2002 based on its strong core operations. But "the sexiest part of the story" is that the company may have the opportunity to sell unregulated power to New York City this summer at rates comparable to those being charged in California.

Having started to see "energy surplus" charges on restaurant bills here in Northern California, I can attest that an opportunity to profit from any potential energy shortage in New York is not to be taken lightly.

As originally published, this story contained an error. Please see

Corrections and Clarifications.

Aaron L. Task writes daily for In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to

Aaron L. Task.