DAVE HARRIS: Welcome to the Dave On Stocks podcast # 75. It's Tuesday September 18, 2007. I'm Dave Harris. I'm a long-term investor with a perspective on this market rally with individual stock advice.

It's just after the close and the market rallied big time today after the Federal Reserve cut the fed funds rate by half-percentage point. The Dow Jones Industrials rose a whopping 335.97 points to 13,739.39. The S&P 500 went 43.13 points higher to 1,519.78. The NASDAQ closed 70 points higher to 2651.66. Oil prices rose .94 cents and up 81.51 a barrel. Oil was at a new trading high hitting 81.90 a barrel. The 10 year note fell 11/32 bringing the yield up to 4.50 percent.

Today's move by the Fed was the first rate cut in 4 years. This comes as a surprise in my view, because most on Wall Street forecast a quarter percentage rate cut. Only some analysts expected a half percentage point cut. So, this brings the key interest rate down to 4.75 percent from 5.25. This is what banks charge each other for federal funds. Clearly, the Central Bank is more concerned about recession than inflation here. After all, they acknowledged core inflation has improved modestly this year. Earlier today the Labor Department said wholesale inflation fell 1.4 percent in August, and that was better than expected. The core inflation was tame, it only rose .2 percent. So I think this piece of economic data had some influence on the Fed's decision. The poor housing situation and mortgage troubles are threatening our economic growth. Recession is a concern, and the Central Bank knows it. Today's rate cut will pump some juice into the economy, in other words give it a boost.

Some of the big gainers today include construction equipment maker Caterpillar (CAT) up 3.77 at 77.46 per share. I have a strong buy on this stock. It's a cyclical holding and I see it going to $88 per share in due time. JP Morgan (JPM) rose 2.53 to 47.82 per share. I think the financials like JPM, Citigroup (C) and Bank of America (BAC) are good buys now.

Apple (AAPL) announced the November 9^th launch of the iPhone in Brittan. It will work with mobile operator 02. This is the first place outside the U.S. the iPhone will be sold. Germany will probably be next. How could you not like Apple here? It's up 2.51 at 140.92 per share. I suggest buying this stock before it hits 170!

That's all for today's podcast of Dave On Stocks. What a great day on Wall Street! Thanks for listening. I'm Dave Harris. Remember you can write me with any questions or comments at the "contact us" link on this page. My website is www.daveonstocks.com. I'll talk to you again soon. This is Dave On Stocks.