On Monday the Dow Industrial Average rebounded to a high of 12,722 with the NASDAQ as high as 2850. Stocks were mixed in Asia with most indices higher, but the Nikkei 225 declined 0.7% to 9794. European shares were down on Monday on concerns over the Greek debt crisis. Last week the Dow Industrial Average declined 172 points to 12,639, up 9.2% year to date. The NASDAQ slipped by 46 points last week to 2828 and is up 6.6% year to date. The yield on the 10-Year US Treasury note declined 12.6 basis points last week to 3.162 as the flight to quality continued. This yield traded down to 3.135 percent on Monday. This week the US Treasury auctions $32 billion 3-Year notes on Tuesday, $24 billion 10-Year notes on Wednesday and $16 billion 30-Year bonds on Thursday. Comex gold was crushed by $70.80 the Troy ounce last week to $1491.2 at Friday’s closing price.
On Monday gold rebounded above $1510.0. Nymex crude oil plunged $15.92 per barrel to $97.78 last week and rebounded on Monday to a session high of $103.40. The euro slumped from above 1.4800 to 1.4350 last week and continued to slide on Monday to a low of 1.4258 before rebounding back towards 1.4350. This week’s economic date include PPI on Thursday and CPI on Friday, and Retail Sales on Thursday.
Energy
Regency Energy (RGNC) gets reinstated with an Outperform rating and $31 price objective by brokers Robert W. Baird. BP Plc (BP) gets an Equal Weight-from-Underweight boost by Barclays. Noble Corp (NE) is now a Strong Buy from Reduce at Duncan-Williams. Helmerich & Payne (HP) is hoisted to Strong Buy from Reduce with a $72 target at brokers Duncan-Williams. Diamond Offshore Drilling (DO) is upgraded to Strong Buy from Reduce at Duncan-Williams. Ultra Petroleum (UPL) is raised to Hold from Sell at Canaccord Genuity. Cameco (CCJ) is boosted to Buy from Hold at TD Newcrest. In afternoon trading: Shares of Rosetta Resources (ROSE) are up about 19.25%. Shares of Nordic American Tanker (NAT) are up about 8.25%. Shares of Holly Corp (HOC) are up about 7.75%. Shares of Sandridge Energy (SD) are up about 7.5%.
The Energy Select Sector SPDR (XLE) was trading at $76.11 at 4:00 PM on Monday, up 1.75% on the day – up 11.52% year-to-date.
Materials
In afternoon trading: Shares of Headwaters (HW) are down about 15.5%. Shares of Thompson Creek Metals (TC) are down about 5.75%. Shares of Yongye International (YONG) are down about 5.5%. Shares of Endeavour Silver (EXK) are up about 8.25%. Shares of Hecla Mining (HL) are up about 5.25%. Shares of Taseko Mines (TGB) are up about 5.25%.
The Materials Select Sector SPDR (XLB) traded at $39.92 at 4:00 PM on Monday, up 1.45% on the day – up 3.93% year-to-date.
Industrials
Hertz (HTZ) has bid $2.08B to buy Dollar Thrifty Auto Group (DTG) in an offer that comprises $57.60 in cash and 0.8546 of its own shares for every Dollar Thrifty share. The deal is worth $72 a share (a 26% premium). Terex’s (TEX) €884M ($1.31B) bid for Demag Cranes (DMGCF.PK) has suffered a blow after Cevian Capital, the German company’s largest shareholder, described the €41.75 offer as ‘completely inadequate.’ IDEX Corp (IEX) is initiated as an Outperform at Wells Fargo. Southwest Air (LUV) is lifted to Buy from Hold with a $15 target at Dahlman Rose. American Science & Engineering (ASEI) is downgraded to Hold at The Benchmark Company. In afternoon trading: Shares of Dollar Thrifty are up about 13%.
The Industrial Select Sector SPDR (XLI) traded at $38.23 at 4:00 PM on Monday, up 0.42% on the day – up 9.64% year-to-date.
Consumer Discretionary
Ross Stores (ROST) is raised to Hold from Sell at Citigroup. Staples (SPLS) is slashed to Reduce from Neutral at Nomura. Abercrombie & Fitch (ANF) is now Neutral from Positive at Susquehanna. In afternoon trading: Shares of Weight Watchers (WTW) are up about 12.25%. Shares of Krispy Kreme (KKD) are up about 6.75%. Shares of H&R Block (HRB) are down about 6.5%.
The Consumer Discretionary Select Sector SPDR (XLY) traded at $40.34 at 4:00 PM on Monday, up slightly on the day – up 7.83% year-to-date.
Consumer Staples
PepsiCo (PEP) gets added to Goldman’s list of Conviction Buys. Mead Johnson Nutrition (MJN) is moved Neutral from Buy at Goldman. In afternoon trading: Shares of SYSCO (SYY) are up about 11.5%. Shares of Star Scientific (CIGX) are up about 4.1%. Shares of Tyson Foods (TSN) are down about 6%. Shares of Pilgrim’s Pride (PPC) are down about 4%.
The Consumer Staples Select Sector SPDR (XLP) traded at $31.55 at 4:00 PM on Monday, up 0.35% on the day – up 7.64% year-to-date.
Healthcare
Elan (ELN) has agreed to sell its drug technology unit EDT to U.S. firm Alkermes (ALKS) in a $960M deal in which the Irish biotech will receive $500M in cash and a 25% stake in the merged group. Vertex Pharmaceuticals (VRTX) is hoisted to Buy from Hold at ThinkEquity. Salix Pharmaceuticals (SLXP) is moved to Outperform from Market Perform at JMP Securities. Infinity Pharmaceutical (INFI) is now Overweight from Neutral at Piper Jaffray. Teva Pharmaceutical (TEVA) gets taken to Outperform from Market Perform by Sanford Bernstein. In afternoon trading: Shares of Cerus Corp (CERS) are up about 9.5%. Shares of Sequenom (SQNM) are up about 5.75%. Shares of AEterna Zentaris (AEZS) are up about 5.75%. Shares of Vertex Pharmaceuticals are up about 5.75%. Shares of GTx Inc (GTXI) are down about 7.75%.
The Health Care Select Sector SPDR (XLV) traded at $35.70 at 4:00 PM on Monday, up 0.56% on the day – up 13.33% year-to-date.
Financials
Barclays (BCS) has made a provision of £1B ($1.64B) to compensate customers for the mis-selling of payment protection insurance, while HSBC (HBC) has set aside $440M. The provisions come after the British Bankers’ Association said it wouldn’t appeal a court ruling that made banks liable for these claims. HSBC’s (HBC) Q1 2011 adjusted pretax profit fell to $5.5B from $6B a year earlier and missed analyst expectations of $6B. Apollo Global Management (APO) is initiated with an Overweight at JPMorgan as well as other firms. E*TRADE (ETFC) is upgraded to Buy from Neutral at Goldman Sachs. XL Group (XL), Ameriprise Financial (AMP), and Evercore Partners (EVR) are all added to Goldman’s Conviction Buy List. TD AmeriTrade (AMTD) is downgraded to Neutral from Buy at Goldman. T. Rowe Price (TROW) is downgraded to Buy from Conviction Buy at Goldman. Digital Realty Trust (DLR) is removed from Goldman’s Conviction Buy List. In afternoon trading: Shares of Lehman Brothers (LEHMQ) are down over 10%.
The Financial Select Sector SPDR (XLF) traded at $16.07 at 4:00 PM on Monday, down 0.25% on the day – up 0.75% year-to-date.
Information Technology
Apple (AAPL) has overtaken Google (GOOG) as the world’s most valuable brand, WPP (WPPGY) said in its annual report. Apple’s brand value is now $153.3 billion (up 84%), while Google’s is $111.5 billion (down 2%). Verint Systems (VRNT) is covered with an Outperform and $42 price target at Credit Suisse. Alcatel-Lucent (ALU) is upgraded to Hold from Sell at Capstone, but is cut to Sell from Hold at Societe Generale. Commvault Systems (CVLT) is cut to Sell from Hold with a $28 target at Capstone. In afternoon trading: Shares of Nuance Communications (NUAN) are up about 8.1%. Shares of Motricity (MOTR) are up about 5.5%.
The Technology Select Sector SPDR (XLK) traded at $26.59 at 4:00 PM on Monday, up 0.42% on the day – up 5.56% year-to-date.
Telecommunications Services
Telefonica S.A. (TEF) is taken to Hold from Buy at Deutsche Bank. In afternoon trading: Actives: Shares of Level 3 Communications (LVLT) are up about 1.5%. Shares of Sprint Nextel (S) are up about 1.5%. Shares of AT&T (T) are up about a quarter of a percent. Shares of Frontier Communications (FTR) are up about 1.2%. Shares of Metro PCS (PCS) are up about 1.7%. Shares of Verizon (VZ) are up slightly.
The NASDAQ Telecommunications Index (IXTC) traded at $226.04 at 4:00 PM on Monday, up 0.51% on the day – up 0.30% year-to-date.
Utilities
American Water (AWK) is lifted to Buy from Hold at Citi. In afternoon trading: Actives: Shares of AES (AES) are up about 1.9%. Shares of Duke Energy (DUK) are up about 0.7%. Shares of PPL (PPL) are down about 0.7%. Shares of Exelon (EXC) are down slightly. Shares of Southern (SO) are up about 0.3%. Shares of Dynegy (DYN) are down about 2%.
The Utilities Select Sector SPDR (XLU) traded at $33.36 at 4:00 PM on Monday, up 0.21% on the day – up 6.45% year-to-date.
STOCKS: RGNC, BP, NE, HP, DO, UPL, CCJ, ROSE, NAT, HOC, SD, HW, TC, YONG, EXK, HL, TGB, HTZ, DTG, TEX, DMGCF, IEX, LUV, ASEI, ROST, SPLS, ANF, MTW, KKD, HRB, PEP, MJN, SYY, CIGX, TSN, PPC, ELN, ALKS, VRTX, SLXP, INFI, TEVA, CERS, SQNM, AEZS, GTXI, BCS, HBC, APO, ETFC, XL, AMP, EVR, AMTD, TROW, DLR, LEHMQ, AAPL, GOOG, WPPGY, VRNT, ALU, CVLT, NUAN, MOTR, TEF, LVLT, S, T, FTR, PCS, VZ, AWK, AES, DUK, PPL, EXC, SO, DYN
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