WordPress output posts by date for current category

query_posts-date.php

<div id="loop" class="clear">

	<?php // List Pages by Month
	
		$paged = (get_query_var('paged')) ? get_query_var('paged') : 1;
		$cat = get_query_var('cat');
		$args = array(
		'paged' => $paged,
		'cat' => $cat,
		'post_type' => 'post',
		'posts_per_page' => 10,
				 );
		query_posts($args);
		if (have_posts()) : while (have_posts()) : the_post();
			$this_dt = get_the_time('F',$post->post_date);
		if ($curr_dt != $this_dt) { ?>
	
			<h3 class="month"><?php echo $this_dt; ?> Issue </h3>
	
	<?php } ?>

	<div <?php post_class('post clear'); ?> id="post_<?php the_ID(); ?>">
	
		<?php if ( has_post_thumbnail() ) :?>
			<a href="<?php the_permalink() ?>" class="thumb"><?php the_post_thumbnail('thumbnail', array(
			'alt'	=> trim(strip_tags( $post->post_title )),
			'title'	=> trim(strip_tags( $post->post_title )),
			)); ?></a>
		<?php endif; ?>
	
		<div class="post-category"><?php the_category( ' / ' , 'multiple' ); ?></div>
			<h2><a href="<?php the_permalink() ?>"><?php the_title(); ?></a></h2>
	
			<div class="post-meta">
				<span class="post-date"><?php the_time(__('F j, Y')) ?></span> <em>&bull; </em><?php comments_popup_link(__('No Comments'), __('1 Comment'), __('% Comments'), '', __('Comments Closed')); ?> 
			</div>
		<div class="post-content"><?php if (function_exists('smart_excerpt')) smart_excerpt(get_the_excerpt(), 55); ?></div>
	
	<?php echo "</div>"; 
	
	$curr_dt = $this_dt; endwhile; ?>

	<?php else :
		// Code here for no pages found
		endif;
	?>
</div>