Equities Sector Coverage: Apple’s Resurgence Carries Wall Street

Durable Goods Orders were weaker than expected with a decline of 4.2% in March, down 1.1% excluding Transportation. The Fed Statement – The economy is expanding moderately with an improved labor market, but the unemployment rate remains elevated. The most important segment of this statement is, “the housing sector remains depressed”. The Fed reflected the inflationary aspect of higher prices of crude oil and gasoline. The Dow Jones Industrial Average rebounded to a day’s high at 13,105.70 above its 50-day simple moving average at 13,021. The NASDAQ’s popped above its 50-day simple moving average at 3016 on the renewed Apple (AAPL) upward momentum. The day’s high for the NASDAQ is 3031.41.

Asian stocks were mixed again on Wednesday. The Nikkei 225 ended their session at 9,561 – up 0.98% on the day. The Hang Seng ended their session at 20,646 – down 0.15% on the day. European exchanges rebounded again on Wednesday. The FTSE 100 ended their session at 5,719 – up 0.16% on the day. The DAX ended their session at 6,705 – up 1.73% on the day. The CAC 40 ended their session at 3,233 – up 2.02% on the day. The yield on the 10-Year US Treasury rose from 1.958 percent to 2.039 below its 50-day and 200-day simple moving averages at 2.081 and 2.097.

Gold declined from $1647.6 the Troy ounce to $1625.0 below the “death cross” defined by the 50-day simple moving average at $1682.0 being below the 200-day simple moving average at $1696.6. Crude oil rallied from $103.11 per barrel to $104.57, staying below its 50-day simple moving average at $104.98. The euro versus the dollar rallied from 1.3184 to 1.3235 above its 50-day simple moving average at 1.3207.

Energy

Hess (HES) beat Q1 EPS estimates by four cents with better than expected revenue. RPC (RES) beat Q1 EPS estimates by a penny, but missed on the revenue line. National-Oilwell (NOV) beat Q1 EPS estimates by a nickel with in-line revenue. Cenovus Energy (CVE) beat Q1 EPS estimates by eleven cents. Nabors Industries (NBR) reported Q1 EPS of 60 cents on better than expected revenue. QEP Resources (QEP) missed Q1 EPS estimates by four cents with in-line revenue. Dow components – Chevron (CVX) gained 0.2% in morning trading with Exxon Mobil (XOM) also up 0.2%.
Energy Select Sector SPDR (XLE) was trading at $69.98 at 3:30 PM on Wednesday, up 0.84% on the day – up 1.23% year-to-date.

Materials

Owens Corning (OC) reported Q1 EPS of nine cents and beat on the revenue line. Ternium (TX) reported Q1 EPS of 81 cents per shares with in-line revenue. Rockwood (ROC) beat Q1 EPS estimates by twenty cents with weaker than expected revenue. Noranda Aluminum (NOR) beat Q1 EPS estimates by twelve cents with in-line revenue. Praxair (PX) beat Q1 EPS estimates by two cents with in-line revenue. Century Aluminum (CENX) beat Q1 EPS estimates by eighteen cents with better than expected revenue. Intrepid Potash (IPI) has been initiated with a Buy rating at KeyBanc Capital with a $30 price target. US Steel (X) has been upgraded to Neutral from Sell at Macquarie. Dow components – Alcoa (AA) picked up 1.3% still below the $10 threshold. DuPont (DD) gained 2.2%.
The Materials Select Sector SPDR (XLB) was trading at $36.75 at 3:30 PM on Wednesday, up 2.00% on the day – up 9.70% year-to-date.

Industrials

Siemens (SI) reported that its Q2 net profit slumped 67% to 1.05 billion euros, which missed analysts forecasts. Siemens was hit by write-downs on a major offshore wind-power project, and with its joint venture with Nokia (NOK), and as a result the company lowered its FY profit guidance. The FAA has proposed frequent and detailed inspections of windshields on over 600 Boeing (BA) 757 airliners following years of safety concerns. Meadwestvaco (MWV) beat Q1 EPS estimates by ten cents. Caterpillar (CAT) raised its full year profit outlook to $9.50 per share while keeping revenue guidance at $68 to $72 billion. The company reported a slowing in China and Brazil, and this stock declined at Wednesday’s open. Boeing (BA) beat Q1 EPS estimates by 27 cents with better than expected revenue. Northrop Grumman (NOC) beat Q1 EPS estimates by 37 cents but missed on the revenue line.

Rockwell Automation (ROK) missed Q1 EPS estimates by eleven cents with in-line revenue. General Dynamics (GD) missed Q1 EPS estimates by twelve cents with a miss on the revenue line. C.H. Robinson Worldwide (CHRW) reported Q1 EPS in-line, but missed on the revenue line. Dow components – Boeing Co (BA) gained 4.4% in morning trading, with Caterpillar (CAT) down 4.8%, General Electric (GE) was flat, 3M Company (MMM) rallied 0.4%, and United Technologies (UTX) was flat.

The Industrial Select Sector SPDR (XLI) was trading at $36.88 at 3:30 PM on Wednesday, up 0.11% on the day – up 9.27% year-to-date.

Consumer Discretionary

Jones Group (JNY) beat Q1 EPS estimates by seventeen cents with in-line revenue. Penske Automotive (PAG) beat Q1 EPS estimates by seven cents with better than expected revenues. Harley-Davidson (HOG) beat Q1 EPS estimates by two cents with better than expected revenue. AutoNation (AN) beat Q1 EPS estimates by three cents on better than expected revenue. Buffalo Wild Wings (BWLD) beat Q1 EPS estimates by two cents with in-line revenue. International Game Technology (IGT) beat FQ2 EPS estimates by two cents with better than expected revenue. McDonald’s (MCD) has been downgraded to Hold from Buy at Argus due to decelerating earnings growth. Dow Components – Disney (DIS) gained 0.9% in morning trading with McDonalds (MCD) was up 0.4%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $44.68 at 3:30 PM on Wednesday, up 1.52% on the day – up 14.51% year-to-date.

Consumer Staples

Lumber Liquidators Holdings (LL) beat Q1 EPS estimates by four cents with better than expected revenue. Tupperware (TUP) beat Q1 EPS estimates by a nickel with better than expected revenue. GNC Holdings (GNC) beat Q1 EPS estimates by eight cents with better than expected revenue. Panera Bread (PNRA) beat Q1 EPS estimates by a nickel with in-line revenue. Wal-Mart (WMT) has been downgraded to Hold from Buy at Argus Research amid a Mexico bribery investigation. Dow components – Home Depot (HD) gained 1.1% in morning trading with Kraft (KFT) up 1.1%, Coca Cola (KO) up 1.0%, Procter & Gamble (PG) gained 0.4%, and Wal-Mart (WMT) was flat.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.98 at 3:30 PM on Wednesday, up 0.56% on the day – up 4.59% year-to-date.

Health Care

Eli Lilly’s (LLY) reported that Q1 EPS fell to 92 cents from $1.24 as revenue slipped 4.1% to $5.6 billion. Revenue from Cymbalta, the depression drug increased 23% on strong U.S. and international growth. Human Genome Sciences (HGSI) continues to review its strategic options after rejecting a $2.6 billion bid from Glaxo last week. WellPoint Health Networks (WLP) beat Q1 EPS estimates by eight cents but revenue was below expectations. Vascular Solutions (VASC) Q1 EPS estimates by two cents on better than expected revenue. USANA Health Sciences (USNA) beat Q1 EPS estimates by 21 cents with a beat on the revenue line. Questcor Pharmaceuticals (QCOR) beat Q1 EPS estimates by six cents with better than expected revenue. Amgen (AMGN) beat Q1 EPS by sixteen cents on better than expected revenue. Dow Components – Johnson & Johnson (JNJ) gained 0.8%, Merck (MRK) was up 0.2%, and Pfizer (PFE) advanced by 1.0%.
The Health Care Select Sector SPDR (XLV) was trading at $37.49 at 3:30 PM on Wednesday, up 0.97% on the day – up 8.07% year-to-date.

Financials

Five major banks are facing potential downgrades from Moody’s, with estimated additional costs of $22 billion. The “too big to fail” banks are aggressively campaigning against potential downgrades in a move against rating agencies not seen since before the financial crisis. BankUnited (BKU) beat Q1 EPS estimates by four cents. First Midwest Bancorp (FMBI) missed Q1 EPS estimates by two cents. Aflac (AFL) beat Q1 EPS estimates with in-line revenue. Fifth Third Bancorp (FITB) has been upgraded to Buy from Hold at Deutsche Bank. Dow Components – American Express (AXP) gained 1.9%, Bank of America (BAC) rebounded 0.4%, JP Morgan (JPM) slipped 0.1%, and Travelers (TRV) was up 0.2%.
The Financial Select Sector SPDR (XLF) was trading at $15.37 at 3:30 PM on Wednesday, up 0.79% on the day – up 18.23% year-to-date.

Information Technology

After severe investor nervousness, Apple (AAPL) earnings came in much stronger than expected. Apple shares fell from an all time high at $644 on April 10th to $555 on April 24th. Apple reported that iPhone shipments jumping 88% to 35.1 million units and iPad sales surged 150% to 11.8 million, and shares were trading above $612 pre-market. Joseph Tucci will remain CEO at EMC (EMC) indefinitely reversing plans to retire in December. Corning (GLW) beat Q1 EPS estimates by two cents with better than expected revenue. United Microelectronics (UMC) beat Q1 EPS estimates by three cents on better than expected revenue. Unisys (UIS) beat Q1 EPS estimates by nine cents with better than expected revenue. Juniper Networks (JNPR) posted Q1 results ahead of schedule with a beat on both EPS and revenue. Dow Components – Cisco Systems (CSCO) slipped 0.2% in morning trading, Hewlett-Packard (HPQ) gained 0.8%, IBM (IBM) rallied 1.5%, Intel Corp (INTC) was up by 1.7%, and Microsoft (MSFT) gained 0.6%.
The Technology Select Sector SPDR (XLK) was trading at $29.76 at 3:30 PM on Wednesday, up 2.66% on the day – up 16.94% year-to-date.

Telecommunication Services

Motorola Solutions (MSI) beat Q1 EPS estimates by a nickel with better than expected revenue. Sprint Nextel (S) beat Q1 EPS estimates by ten cents with in-line revenue. Dow components – AT&T (T) was flat in morning trading with Verizon (VZ) slipping 0.2%.
The NASDAQ Telecommunications Index (IXTC) was trading at $207.37 at 3:30 PM on Wednesday, up 0.59% on the day – up 5.30% year-to-date.

Utilities

Southern Company (SO) missed Q1 EPS estimates by a nickel with lower than expected revenue. NextEra Energy (NEE) beat Q1 EPS estimates by four cents with in-line revenue. NorthWestern (NEW) beat Q1 EPS estimates by a nickel with in-line revenue. Dominion Resources (D) was up 0.9% in morning trading, Edison International (EIX) gained 1.1%, First Energy (FE) was up 0.6%, and PG&E Corp (PCG) gained 0.2%.
The Utilities Select Sector SPDR (XLU) was trading at $35.25 at 3:30 PM on Wednesday, up 0.40% on the day – down 2.03% year-to-date.

STOCKS: CVX, XOM, HES, RES, NOV, CVE, NBR, QEP, AA, DD, OC, TX, ROC, NOR, PX, CENX, IPI, X, BA, CAT, GE, MMM, UTX, SI, NOK, MWV, NOC, ROK, GD, CHRW, DIS, MCD, JNY, PAG, HOG, AN, BWLD, IGT, HD, KFT, KO, PG, WMT, LL, TUP, GNC, PNRA, JNJ, MRK, PFE, LLY, HGSI, WLP, VASC, USNA, QCOR, AMGN, AXP, BAC, JPM, TRV, BKU, FMBI, AFL, FITB, CSCO, HPQ, IBM, INTC, MSFT, AAPL, EMC, GLW, UMC, UIS, JNPR, T, VZ, MSI, S, D, EIX, FE, PCG, SO, NEE, NEW