The National Association of Home Builders announced that their Housing Market Index came in with a reading of 28 in March unchanged from February’s reading which was revised downward by a point. This is a sign that the home construction market has stabilized but at a level well below the neutral 50 reading for this data series. The next chapter for the housing market is Housing Starts for February out Tuesday morning. The Dow Jones Industrial Average traded down to 13,208.63 then rebounded to 13,269.71 into the final hour of trading shy of its year to date high at 13,289.08. The NASDAQ’s traded down to 3050.89 then rose to 3087.10 going into the final hour of trading, yet another year to date high.
Asian stocks were mixed on Monday. The Nikkei 225 ended their session at 10,142 – up 0.12% on the day. The Hang Seng ended their session at 21,115 – down 0.95% on the day. European stocks slipped on Monday. The FTSE 100 ended their session at 5,961 – down 0.07% on the day. The DAX ended their session at 7,154 – down 0.05% on the day. The CAC 40 ended their session at 3,578 – down 0.47% on the day. The yield on the 10-Year US Treasury rose from 2.262 percent to 2.390 staying above its 200-day simple moving average at 2.217.
Gold traded up from $1652.3 the Troy ounce to $1670.1 staying below its 200-day simple moving averages at $1679.7 for three consecutive days. Crude oil rebounded from $106.55 per barrel to $108.24. The euro versus the dollar traded rebounded from 1.3145 to 1.3263.
Energy
Confusion reigns as to whether Exxon Mobil (XOM) has bowed to Iraqi pressure and stopped its work in Kurdistan. Brazilian prosecutors expect to file criminal charges against 17 Chevron (CVX) and Transocean (RIG) executives this week in connection with last November’s offshore oil spill. Devon Energy (DVN) gets upgraded to Buy from Neutral at Goldman Sachs, which adds SunCoke Energy (SXC) to its Conviction Buy list. Ensco (ESV) is increased to Overweight from Neutral at JPMorgan. ENI S.p.A. (E) is now Outperform from Neutral at Credit Suisse. Patriot Coal (PCX) is lifted to Neutral from Sell by Goldman. Subsea 7 SA (SUBCY) is hoisted to Hold from Sell at Société Générale. Arch Coal (ACI) is slashed to Sell from Neutral at Goldman. Apache Corp (APA) and Newfield Exploration (NFX) are each now Neutral from Buy at Goldman. Rowan Cos (RDC) gets reduced to Neutral from Overweight at JPMorgan.
Energy Select Sector SPDR (XLE) was trading at $75.14 at 4:00 PM on Monday, up 0.45% on the day – up 8.69% year-to-date. The February 2012 change was +5.93%. The 2011 change was -1.29%.
Big Movers: (FRO) +18.5%, (DHT) +14.5%, (GST) +12.25%.
Materials
Antofagasta plc (ANFGY) is upgraded to Outperform from Neutral by BNP Paribas. Devon Energy (DVN) gets upgraded to Buy from Neutral at Goldman Sachs, which adds SunCoke Energy (SXC) to its Conviction Buy list. Steel Dynamics (STLD) and Nucor (NUE) are each upgraded to Buy from Neutral at UBS.
The Materials Select Sector SPDR (XLB) was trading at $37.33 at 4:00 PM on Monday, up 0.62% on the day – up 11.3% year-to-date. The February 2012 change was -0.56%. The 2011 change was -12.78%.
Big Movers: (CTJHF) +47.5%, (CPGI) +13%, (ZINC) +8.5%, (AVL) +8.25%,
(CAGC) -26.5%, (YONG) -10%, (CDTI) -9.5%.
Industrials
UPS (UPS) has finally clinched a deal to buy TNT Express after sweetening its offer to €5.16B ($6.8B), or €9.50 a share (a 54% premium), up from an original bid of €9. United Parcel Service (UPS) is now Overweight from Neutral at JPMorgan. Excel Maritime Carriers (EXM) is hoisted to Hold from Underperform at Jefferies. Alliant Techsystems (ATK) is now Underweight from Equal Weight at Barclays.
The Industrial Select Sector SPDR (XLI) was trading at $37.98 at 4:00 PM on Monday, unchanged on the day – up 12.53% year-to-date. The February 2012 change was +2.79%. The 2011 change was -3.21%.
Big Movers: (NFEC) +21.75%, (YRCW) +11.5%, (APWR) -14.25%, (MY) -11%.
Consumer Discretionary
Starbucks (SBUX) is opening its first juice bar today, in upscale Bellevue, Washington. In going up against the likes of Jamba (JMBA), Starbucks hopes that its new line of Evolution Fresh shops will boost its position in the $50B health-food sector. YUM! Brands (YUM) is initiated with an Outperform at Oppenheimer with a price objective of $82. American Public Education (APEI) and Bridgepoint Education (BPI) are both begun with Overweights at Barclays. Intercontinental Hotels Group (IHG) is started with a Sell at Société Générale. Caesars Entertainment (CZR) is a Hold at both Deutsche Bank and KeyBanc Capital. Pandora Media (P) is picked up with a Neutral at Credit Suisse with a $12 price target. DreamWorks Animation (DWA) gets increased to Overweight from Neutral at Piper Jaffray. Gap Inc (GPS) gets upgraded to Outperform from Market Perform by BMO Capital. Sony (SNE) is upgraded to Outperform from Underperform at Crédit Agricole.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $44.58 at 4:00 PM on Monday, up 0.52% on the day – up 14.25% year-to-date. The February 2012 change was +10.09%. The 2011 change was +4.30%.
Consumer Staples
Roundy’s Inc (RNDY) is resumed with an Outperform at Robert W. Baird. Colgate-Palmolive (CL) is upgraded 180 degrees, to Outperform from Underperform at Crédit Agricole.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.62 at 4:00 PM on Monday, up slightly on the day – up 3.48% year-to-date. The February 2012 change was +3.75%. The 2011 change was +10.85%.
Big Movers: (IPSU) +16.75%, (FEED) +11.5%, (FARM) +9.5%.
Heavily Traded: (RAD) -1.25%, (WMT) -0.25%, (MO) +0.2%, (SWY) -2.1%.
Health Care
Over 25 states are investigating Express Scripts’ (ESRX) proposed $29.1B acquisition of Medco (MHS) for possible antitrust violations, Bloomberg reports. Abbott Labs (ABT) is boosted to Buy from Hold at Deutsche Bank. Biomarin Pharmaceuticals (BMRN) is now Buy from Hold with a $41 target at Brean Murray. Vertex Pharmaceuticals (VRTX) is moved to Underweight from Equal Weight at Morgan Stanley. Cardiome Pharma (CRME) was downgraded to Perform from Outperform at Oppenheimer.
The Health Care Select Sector SPDR (XLV) was trading at $36.84 at 4:00 PM on Monday, down slightly on the day – up 6.20% year-to-date. The February 2012 change was +1.06%. The 2011 change was +10.32%.
Big Movers: (CRME) -55.5%, (TPST) +10%.
Financials
E*TRADE (ETFC) is moved to Outperform from Market Perform with Wells Fargo. Charles Schwab (SCHW) is now Buy from Neutral at Citigroup. Capital One Financial (COF) is boosted to Buy from Hold at Jefferies. Cullen/Frost Bankers (CFR) gets cut to Hold from Buy due to valuation with Wunderlich with an objective is $60. Munich Re (MURGY) is now Neutral from Buy at UBS.
The Financial Select Sector SPDR (XLF) was trading at $15.80 at 4:00 PM on Monday, up 0.51% on the day – up 21.54% year-to-date (the strongest performing sector). The February 2012 change was +5.02%. The 2011 change was -18.50%; the weakest performing sector for the year.
Big Movers: (ABKFQ) +45%, (ALBKY) +10.75%.
Information Technology
Apple (AAPL) has $98 billion in cash and announced a $2.65 per share quarterly dividend and a $10 billion stock buyback plan beginning in 2013. LDK Solar (LDK) has lowered the top end of its Q4 revenue guidance, forecasting sales of $440M-450M vs. $440M-520M previously. Start-up JBI (JBII) wants recycling to go mainstream and here’s why: The company takes plastic waste, of which only 7% is recycled every year in the U.S., and converts it into highly-refined, industrial-quality oil. Trina Solar (TSL) and Yingli Green Energy (YGE) are each initiated with Equal Weights by Barclays. NVIDIA (NVDA) is now Equal Weight from Underweight at Evercore. eBay Inc (EBAY) is now Neutral from Buy at Citigroup. Memsic (MEMS) is lowered to Hold from Buy at Needham. ReneSola (SOL) is reduced to Underperform from Market Perform at Macquarie
The Technology Select Sector SPDR (XLK) was trading at $30.10 at 4:00 PM on Monday, up 0.74% on the day – up 18.27% year-to-date. The February 2012 change was +7.08%. The 2011 change was +1.03%.
Big Movers: (SOFN) +33.25%, (MUSJF) +12%, (ANGI) +10.5%, (NIPNF) -26.25%.
Telecommunication Services
Sprint Nextel (S) is downgraded to Underperform from Market Perform by Sanford Bernstein. Magyar Telekom (MYTAY) is moved to Underweight from Neutral at HSBC Securities.
The NASDAQ Telecommunications Index (IXTC) was trading at $215.35 at 4:00 PM on Monday, up 0.67% on the day – up 9.35% year-to-date. The February 2012 change was +1.63%. The 2011 change was -12.62%.
Big Mover: (ABVT) +13.25%.
Heavily Traded (S) -6.75%, (CLWR) +1.75%, (T) +0.2%.
Utilities
The Utilities Select Sector SPDR (XLU) was trading at $34.54 at 4:00 PM on Monday, down 0.69% on the day – down 4.00% year-to-date (the weakest performing sector). The February 2012 change was +0.61%. The 2011 change was +14.81%; the strongest performing sector for the year.
Big Mover: (DYN) -19.5%.
Heavily Traded: (DUK) -0.4%, (EXC) +0.2%, (CPN) -1.3%, (GEN) -0.6%, (SO) -0.6%.
STOCKS: XOM, CVX, RIG, DVN, SXC, ESV, E, PCX, SUBCY, ACI, APA, NFX, RDC, FRO, DHT, GST, ANFGY, STLD, NUE, CTJHF, CPGI, ZINC, AVL, CAGC, YONG, CDTI, UPS, EXM, ATK, NFEC, YRCW, APWR, MY, SBUX, JMBA, YUM, APEI, BPI, IHG, CZR, P, DWA, GPS, SNE, RNDY, CL, IPSU, FEED, FARM, RAD, WMT, MO, SWY, ESRX, MHS, ABT, BMRN, VRTX, CRME, TPST, ETFC, SCHW, COF, CFR, MURGY, ABKFQ, ALBKY, AAPL, LDK, JBII, TSL, YGE, NVDA, EBAY, MEMS, SOL, SOFN, MUSJF, ANGI, NIPNF, S, MYTAY, ABVT, CLWR, T, DYN, DUK, EXC, CPN, GEN, SO
