DAVE HARRIS: Welcome to Dave On Stocks Podcast #61. This is Wednesday June 6^th 2007. I'm Dave Harris. I'm a long term investor with a perspective on the market and individual stock advice.

We had a sell off on Wall Street today from what I think were inflation worries and a little profit taking. Productivity in the quarter came in lower at 1.0 % from the previous month's 1.7% reading. That was expected, but labor costs rose by 1.8% and that's above views. Combine that data with Fed Chairman Ben Bernanke's comments yesterday that inflation is still a concern, and you have a nervous market. Global inflation is also on investor's minds as the European Central Bank hiked interest rates to 4%. I think this gave investors a reason to sell today. The latest data suggests the Fed will not cut rates anytime soon. Question is, does the market really need a rate cut to go higher? Perhaps it doesn't. The DOW had a tremendous run up with the Fed in pause mode. However, I believe investors and the big money managers were adding positions with the HOPE the Fed will cut soon. But still, the stock market has made tremendous gains without a cut in rates. Our economy is slowing but showing steady growth. And because employment is looking good, I remain bullish. If the economy is doing well, so will stocks. It's that simple. All the mergers and acquisitions activity of late can't be bad either.

The 10 year treasury yield is getting close to 5%, and that would be some competition for stocks. Fixed income investors may find that attractive over more risky equities. That could also be contributing to the recent sell off in my view.

3M (MMM) the diversified maker Scotch Tape and Post-It notes, announced their acquisition of Diamond Productions, a maker of glass and rock cutting tools. This would expand 3M's business into stone and grinding work. I have a buy on 3M and think the stock is headed to $95. It closed down .84 today to $86.62.

Panera Bread (PNRA) the restaurant chain lowered their second quarter same store sales guidance to a range of 1.5-2.5% from a previous 3.4-4.5%. I think this stock has a rough road ahead. I would get out of Panera and into McDonalds (MCD). Panera fell 8.04 to $50.28. McDonalds lost .21 to close at $50.64.

The DOW fell 129.79 to 13,465.67. The NASDAQ lost 24.05 to finish at 2,587.18. The S&P 500 shed 13.57 to 1,517.38.

That's all for today's podcast of Dave On Stocks. I'm Dave Harris. Write me with any questions or comments at the "contact us" link on this page. My website is www.daveonstocks.com. This is Dave On Stocks.