Equities Sector Coverage: Bulls Retake Control on Wall Street

Sector Recap  |

Our International Trade Deficit narrowed to $46 billion in February. PPI came in flat in 0.0%, but rose by 0.3% excluding food & energy. Initial Jobless Claims rose to 380,000 staying above the recessionary level at 350,000. The Dow Jones Industrial Average rebounded to 12,986.96 going into the final half hour of trading, but staying below its 50-day simple moving average at 12,991. The NASDAQ’s rebounded to 3058.71 going into the final half hour of trading after holding its 50-day simple moving average at 2997 on Tuesday.

Asian stocks were higher on Thursday. The Nikkei 225 ended their session at 9,525 – up 0.70% on the day. The Hang Seng ended their session at 20,327 – up 0.93% on the day. European stocks were mixed on Thursday before rallying into the green in late trading. The FTSE 100 ended their session at 5,710 – up 1.34% on the day. The DAX ended their session at 6,743 – up 1.03% on the day. The CAC 40 ended their session at 3,270 – up 0.99% on the day. The yield on the 10-Year US Treasury declined from 2.051 percent to 2.010 then rose to 2.065 below its 50-day simple moving average at 2.074.

Gold rebounded from $1651.0 the Troy ounce and $1681.3 staying below its 50-day and 200-day simple moving averages at $1697.6 and $1691.1, which are converging towards a “death cross”. Crude oil traded up from $102.39 per barrel to $104.24 testing its 50-day simple moving average at $104.21. The euro versus the dollar traded up from 1.3105 to 1.3211 testing its 50-day simple moving average at 1.3212.

Energy

Natural gas prices fell to $1.984 per 1M British thermal units on Wednesday on the NYMEX, the first time below $2 in over ten years. Shell (RDS.A) was down 2.7% premarket after a 10 square mile oil slick was spotted near its platforms in the Gulf of Mexico. Goodrich Petroleum (GDP) is initiated with a Buy rating at Deutsche Bank. Whiting Petroleum (WLL) is initiated with a Buy rating at Brean Murray. PetroChina (PTR) has been upgraded to Buy from Neutral at UBS. First Solar (FSLR) declined 5.4% Thursday morning. Dow components - Chevron (CVX) picked up 0.6% with Exxon Mobil (XOM) up 0.8%.
Energy Select Sector SPDR (XLE) was trading at $69.73 at 3:30 PM on Thursday, up 2.12% on the day – up 0.87% year-to-date.

Materials

With the price of gold around $1675 the Troy ounce, the share price of some gold stocks moved higher Thursday morning; Barrick Gold (ABX) was up 2.0%, and Newmont Mining (NEM) was up 2.6%. Dow components - Alcoa (AA) gained 3.0% in morning trading while DuPont (DD) tacked on 1.6%.

The Materials Select Sector SPDR (XLB) was trading at $36.58 at 3:30 PM on Thursday, up 2.78% on the day – up 9.19% year-to-date.

Industrials

Canadian Pacific (CP) is upgraded to Buy from Neutral at Bank of America-Merrill Lynch. Packaging Corp of America (PKG) has been upgraded to Neutral from Underperform at JPMorgan. Dow components - Boeing Co (BA) gained 1.7%, Caterpillar (CAT) rebounded 3.8%, General Electric (GE) tacked on 0.8, 3M Company (MMM) was higher by 1.4%, and United Technologies (UTX) regained 2.2%.

The Industrial Select Sector SPDR (XLI) was trading at $36.75 at 3:30 PM on Thursday, up 2.00% on the day – up 8.89% year-to-date.

Consumer Discretionary

Electronic Arts (EA) is initiated with a Neutral rating at Ascendiant Capital Markets who cites key game and industry sales concerns. Their price target is $16 per share. BJ Restaurants (BJRI) is initiated with an Overweight rating at Barclays. Mattress Firm (MFRM) has been initiated with a Hold rating at Stifel Nicolaus, which notes that the stock is up 132% since November’s Initial Public Offering. Movado Group (MOV), the watchmaker has been added to the Top Picks Live list at Citigroup. Dow Components - Disney (DIS) was higher by 1.1%, and McDonalds (MCD) lost 0.6%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $44.64 at 3:30 PM on Thursday, up 1.32% on the day – up 14.40% year-to-date.

Consumer Staples

Danone (DANOY) has been upgraded to Buy from Hold at Société Générale. Bed Bath & Beyond (BBBY) has been downgraded to Hold from Buy with a $73 price target at Canaccord Genuity. Dow components - Home Depot (HD) tacked on 1.6%, Kraft (KFT) gained 0.5%, Coca Cola (KO) was flat, Procter & Gamble (PG) declined 1.0% and Wal-Mart (WMT) gained 0.7% in morning trading.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.60 at 3:30 PM on Thursday, up 0.03% on the day – up 3.42% year-to-date.

Health Care

The Department of Veterans Affairs has selected McKesson (MCK) to continue as its primary pharmaceutical supplier in a deal that valued at up to $31.6 billion over as many as eight years. UBS begins Ardea Biosciences (RDEA) with a $31 price target, ARIAD Pharmaceuticals (ARIA) with a $20 price target, and BioMarin Pharmaceutical (BMRN) with a $43 price target and Buy ratings. UBS initiates Achillion Pharmaceuticals (ACHN), Human Genome Sciences (HGSI), Ironwood Pharmaceuticals (IRWD), and InterMune (TMN) with Neutral ratings. ICU Medical (ICUI) is initiated with a Buy rating and $60 price target at Benchmark Company, citing that an aging population will drive an increase in the volume of medical and surgical related procedures. Dow Components - Johnson & Johnson (JNJ) slipped 0.1%, Merck (MRK) lost 0.4%, and Pfizer (PFE) was flat.

The Health Care Select Sector SPDR (XLV) was trading at $36.96 at 3:30 PM on Thursday, up 0.54% on the day – up 6.54% year-to-date.

Financials

Bank of America (BAC) appears to be suing itself over faulty mortgage foreclosures in Florida, with the bank serving as both the loan servicer and the second-lien holder of defaulted mortgages. FBR Capital resumes Outperform ratings on Cardinal Financial (CFNL) with a $13 price target, Virginia Commerce Bancorp (VCBI) with a $10 price target), and State Bank Financial (STBZ) with a $21 price target. FBR Capital has new Market Perform ratings on Eagle Bancorp (EGBN), First Bancorp (FBNC), and Union First Market Bankshares (UBSH). Dow Components - American Express (AXP) was up 1.7%, Bank of America (BAC) rallied by 1.7%, JP Morgan (JPM) gained 1.4%, and Travelers (TRV) gained 1.2%.

The Financial Select Sector SPDR (XLF) was trading at $15.46 at 3:30 PM on Thursday, up 1.78% on the day – up 18.92% year-to-date.

Information Technology

Sony (SNE) has set in motion a five-part restructuring for the company, which includes 10,000 job cuts this fiscal year. Google (GOOG) will report its Q1 2012 earnings after the close today, and analysts expect that EPS grew 19.4% to $9.65 and that revenues climbed 24.7% to $8.15 billion. Netflix (NFLX) is initiated as a new Buy at Suntrust. SunTrust assigns new Neutral ratings on Amazon.com (AMZN), Yahoo (YHOO), Groupon (GRPN), and Pandora (P). SunTrust initiates Google (GOOG) and LinkedIn (LNKD) with Buy ratings. American Superconductor (AMSC) is initiated with a Buy at Maxim Group and $7 price target, as wind power gross margins are estimated at 40%. Dow Components - Cisco Systems (CSCO) gained 0.9%, Hewlett-Packard (HPQ) was up 5.7%, IBM (IBM) gained 0.8%, Intel Corp (INTC) gained 1.2%, and Microsoft (MSFT) gained 1.8%.

The Technology Select Sector SPDR (XLK) was trading at $30.05 at 3:30 PM on Thursday, up 1.31% on the day – up 18.07% year-to-date.

Telecommunication Services

Nokia (NOK) might sell its Navteq map unit, which it bought for about $7.3 billion in 2008. America Movil (AMX), the Mexican telecom firm is initiated with an Outperform rating at Macquarie. AT&T Inc (T) has been upgraded to Overweight from Neutral on improved revenue growth from tablets and price increase efforts. Dow components - AT&T (T) picked up 1.6% while Verizon (VZ) gained 0.2%.

The NASDAQ Telecommunications Index (IXTC) was trading at $212.14 at 3:30 PM on Thursday, up 1.06% on the day – up 7.72% year-to-date.

Utilities

Nokia (NOK) might sell its Navteq map unit, which it bought for about $7.3 billion in 2008. America Movil (AMX), the Mexican telecom firm is initiated with an Outperform rating at Macquarie. AT&T Inc (T) has been upgraded to Overweight from Neutral on improved revenue growth from tablets and price increase efforts. Dominion Resources (D) was down 0.5%, Edison International (EIX) was down 0.6%, First Energy (FE) was flat, and PG&E Corp (PCG) was up 0.7%.

The Utilities Select Sector SPDR (XLU) was trading at $34.43 at 3:30 PM on Thursday, up 0.29% on the day – down 4.31% year-to-date.

STOCKS: CVX, XOM, RDS.A, GDP, WLL, PTR, FSLR, AA, DD, ABX, NEM, BA, CAT, GE, MMM, UTX, CP, PKG, DIS, MCD, EA, BJRI, MFRM, MOC, HD, KFT, KO, PG, WMT, DANOY, BBBY, JNJ, MRK, PFE, MCK, RDEA, ARIA, BMRN, ACHN, HGSI, IRWD, TMN, ICUI, AXP, BAC, JPM, CFNL, VCBI, STBZ, EGBN, FBNC, UBSH, CSCO, HPQ, IBM, INTC, MSFT, SNE, GOOG, NKLX, AMZN, YHOO, GRPN, P, LNKD, T, VZ, NOK, AMX, D, EIX, FE, PCG

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer.

Companies

Symbol Name Price Change % Volume
MMM 3M Company 166.76 -0.31 -0.19 3,713,013 Trade
MCK McKesson Corporation 146.82 1.12 0.77 2,931,215 Trade
FBNC First Bancorp 36.73 0.11 0.30 201,624 Trade
PG Procter & Gamble Company (The) 122.24 0.34 0.28 15,438,260 Trade
GE General Electric Company 9.37 -0.05 -0.53 58,257,220 Trade
CVX Chevron Corporation 124.32 0.66 0.53 10,524,616 Trade
PCG Pacific Gas & Electric Co. 11.61 -0.59 -4.84 17,647,329 Trade
PKG Packaging Corporation of America 102.84 -0.49 -0.47 964,093 Trade
JNJ Johnson & Johnson 131.65 1.54 1.18 12,335,426 Trade
AA Alcoa Corporation 21.70 -0.24 -1.09 5,091,900 Trade
INTC Intel Corporation 50.72 -0.85 -1.65 38,634,649 Trade
D Dominion Energy Inc. 80.84 -0.08 -0.10 8,193,621 Trade
EA Electronic Arts Inc. 98.70 -0.99 -0.99 3,540,861 Trade
ARIA ARIAD Pharmaceuticals Inc. n/a n/a n/a 0 Trade
ESI:CA Ensign Energy Services Inc. 3.40 -0.06 -1.73 8,063,501
WLL Whiting Petroleum Corporation 9.63 0.66 7.36 17,486,802 Trade
EIX Edison International 72.74 0.11 0.15 4,042,254 Trade
AXP American Express Company 116.80 -0.99 -0.84 5,342,370 Trade
UBSH AUB Union Bankshares Corporation n/a n/a n/a n/a
UTX United Technologies Corporation 135.57 -1.96 -1.43 5,337,187 Trade
CSCO Cisco Systems Inc. 49.60 0.41 0.83 49,140,242 Trade
PTR PetroChina Company Limited 52.79 -0.16 -0.30 82,164 Trade
VZ Verizon Communications Inc. 60.29 0.31 0.52 21,409,611 Trade
ABX GOLD Barrick Gold Corporation (BC) n/a n/a n/a 0
ICUI ICU Medical Inc. 159.80 -0.20 -0.13 643,793 Trade
BAC Bank of America Corporation 29.59 -0.23 -0.77 167,802,489 Trade
LNKD LinkedIn Corporation Class A n/a n/a n/a 0 Trade
NOK Nokia Corporation Sponsored American Depositary Shares 5.29 0.14 2.72 24,011,284 Trade
GOOG Alphabet Inc. 1,229.93 -8.78 -0.71 2,337,377 Trade
MCD McDonald's Corporation 209.39 -1.13 -0.54 6,008,214 Trade
BJRI BJ's Restaurants Inc. 35.77 -0.49 -1.35 721,592 Trade
BBBY Bed Bath & Beyond Inc. 9.82 -0.17 -1.70 8,187,949 Trade
ACHN Achillion Pharmaceuticals Inc. 3.74 -0.04 -1.06 3,116,099 Trade
PFE Pfizer Inc. 36.69 0.18 0.49 43,916,806 Trade
IRWD Ironwood Pharmaceuticals Inc. 9.47 -0.12 -1.25 2,513,609 Trade
FSLR First Solar Inc. 66.70 -0.37 -0.55 1,601,412 Trade
EGBN Eagle Bancorp Inc. 44.31 -0.01 -0.02 770,694 Trade
HPQ HP Inc. 18.47 -0.28 -1.49 14,516,557 Trade
YHOO Yahoo! Inc. n/a n/a n/a 0 Trade
CFNL Cardinal Financial Corporation n/a n/a n/a 0 Trade
MRK Merck & Company Inc. (new) 85.16 1.19 1.42 22,713,258 Trade
GRPN Groupon Inc. 2.82 -0.03 -1.05 9,238,700 Trade
FE FirstEnergy Corp. 47.39 -0.72 -1.50 11,044,319 Trade
BMRN BioMarin Pharmaceutical Inc. 74.95 -1.05 -1.38 1,730,200 Trade
KO Coca-Cola Company (The) 53.91 -0.61 -1.12 19,349,991 Trade
SNE Sony Corporation 59.12 -0.23 -0.39 631,232 Trade
CP Canadian Pacific Railway Limited 230.86 -2.93 -1.25 203,554 Trade
T AT&T Inc. 37.91 0.76 2.05 79,104,253 Trade
CAT Caterpillar Inc. 128.16 -1.96 -1.51 6,438,186 Trade
NEM Newmont Goldcorp Corporation 39.84 0.45 1.14 8,365,843 Trade
MSFT Microsoft Corporation 139.44 -1.63 -1.16 40,045,107 Trade
MFRM Mattress Firm Holding Corp. n/a n/a n/a 0 Trade
WMT Walmart Inc. 116.98 -0.13 -0.11 11,587,658 Trade
IBM International Business Machines Corporation 141.88 -1.09 -0.76 5,217,881 Trade
JPM JP Morgan Chase & Co. 118.90 -0.48 -0.40 22,077,433 Trade
AMZN Amazon.com Inc. 1,794.16 -27.34 -1.50 5,557,622 Trade
DIS The Walt Disney Company 132.27 -1.03 -0.77 25,640,777 Trade
HD Home Depot Inc. (The) 224.67 -3.45 -1.51 7,797,135 Trade
XOM Exxon Mobil Corporation 72.08 -0.25 -0.35 19,863,066 Trade
BA The Boeing Company 379.39 -5.05 -1.31 6,853,468 Trade

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Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     

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