The Producer Price Index rose a stronger than expected 0.8% in April and up 0.3% excluding food and energy. PPI is up 6.8% year over year. Initial Jobless Claims stayed above 400,000 at 434,000 for the latest week, well above the 350,000 recession Threshold. The Dow Jones Industrial Average traded to a low of 12537.17 on Thursday before ending the day up about a half of a percent. The NASDAQ slumped to a low of 2819.37 before ending the day up about a half of a percent.
Asian stocks were lower on Thursday with the Nikkei 225 down 1.5% to 9,717. The FTSE 100 ended the day at 5,944.96 (down 0.52%), while the DAX was down 0.68% and the CAC 40 was down 0.86%. On Wednesday the Dow Industrial Average declined 130 points to 12,630 cutting the year to date gain to 9.1%. The NASDAQ lost 27 points to 2845 shaving its year to date gain to 7.2%. The yield on the 10-Year traded between 3.20 and 3.16 overnight, but then yields rose, pushing the 10- Year yield to 3.23. Comex gold declined to a low of $1477.6 the Troy ounce before rallying back above $1500 in afternoon trading. Nymex crude oil traded as low as $95.25 per barrel on Thursday, before rallying to a high of $100.49 in afternoon trading. The euro lost more ground versus the dollar to 1.4126 overnight, but rallied to a high of 1.4274 in afternoon trading. Retail Sales rose 0.5% in April below expectations.
Energy
Transocean (RIG) is raised to Neutral from Underweight at JP Morgan. Newpark Resources (NR) is now Buy from Hold at Jefferies with a new target of $13. In afternoon trading: Shares of First Solar (FSLR) are up about 6.1%. Shares of Cloud Peak Energy (CLD) are up about 5.1%. Shares of Petroleum Development (PETD) are down about 6.4%. Shares of Uranerz Energy (URZ) are down about 5%.
The Energy Select Sector SPDR (XLE) was trading at $74.15 at 4:00 PM on Thursday, down slightly on the day – up 8.64% year-to-date.
Materials
IAMGOLD Corp (IAG) beat estimates by 5 cents and revenue by $38M. Allegheny Technologies (ATI) gets a Buy-from-Neutral boost at Goldman Sachs. In afternoon trading: Shares of Kronos Worldwide (KRO) are down about 6.6%. Shares of Georgia Gulf (GGC) are down about 5.2%. Shares of ADA-ES (ADES) are up about 6%.
The Materials Select Sector SPDR (XLB) traded at $39.15 at 4:00 PM on Thursday, down slightly on the day – up 1.93% year-to-date.
Industrials
In afternoon trading: Shares of Konecranes (KNCRF) are down about 9.5%. Shares of Zipcar (ZIP) are down about 5%. Shares of Twin Disc (TWIN) are up about 6.5%. Actives: Shares of General Electric (GE) are up slightly. Shares of Xerox (XRX) are up slightly. Shares of AMR (AMR) are down about 1.1%. Shares of Corning (GLW) are up about 1.5%.
The Industrial Select Sector SPDR (XLI) traded at $38.14 at 4:00 PM on Thursday, up 0.21% on the day – up 9.38% year-to-date.
Consumer Discretionary
Kohl’s (KSS) reported FQ1 EPS of $0.73 (in-line) and revenue of $4.2B (in-line). TJX Companies (TJX) is begun with a Buy at UBS. Jefferies raised both Ross Stores (ROST) and TJX Cos (TJX) to Hold from Underperform. American Eagle Outfitters (AEO) is cut to Hold from Buy at Jefferies with a new price objective of $15. Reliance Steel (RS) is reduced to Neutral from Buy at Goldman Sachs. Choice Hotels (CHH) gets cut to Hold from Buy at Argus as growth appears to be slowing. Vera Bradley (VRA) is cut to Market Perform from Outperform at Wells Fargo.
The Consumer Discretionary Select Sector SPDR (XLY) traded at $40.87 at 4:00 PM on Thursday, up 0.99% on the day – up 9.25% year-to-date.
Consumer Staples
Diamond Foods (DMND) is begun with a Buy at Deutsche Bank. Imperial Sugar (IPSU) is raised to Buy from Hold with an $18 objective at brokers Rafferty Capital. CVS Caremark (CVS) are upgraded to Buy from Neutral at Bank of America-Merrill Lynch. Hershey Foods (HSY) is lifted to Buy from Hold at Argus. In afternoon trading: Shares of Fosters Group (FBRWY) are down about 19.25%. Shares of Calavo Growers (CVGW) are up about 9.5%. Shares of Winn-Dixie (WINN) are up about 6.5%. Shares of Spartan Stores (SPTN) are up about 6.5%. Shares of Prestige Brands (PBH) are up about 6.5%. Shares of Tyson Foods (TSN) are up about 5%.
The Consumer Staples Select Sector SPDR (XLP) traded at $32.15 at 4:00 PM on Thursday, up 1.48% on the day – up 9.69% year-to-date.
Healthcare
Takeda Pharmaceutical (TKPHF.PK), Asia’s top drug maker, is reportedly in talks to buy closely-held Swiss rival Nycomed. In afternoon trading: Shares of Cadence Pharmaceuticals (CADX) are up about 7.25%. Shares of Anacor Pharmaceuticals (ANAC) are up about 6.75%. Shares of GTx Inc. (GTXI) are up about 6.5%. Shares of Progenics Pharmaceuticals (PGNX) are up about 6.5%. Shares of Biosante Pharmaceuticals (BPAX) are up about 6%. Shares of Centene (CNC) are down about 6%.
The Health Care Select Sector SPDR (XLV) traded at $36.19 at 4:00 PM on Thursday, up 0.92% on the day – up 14.89% year-to-date.
Financials
The Treasury may pull the $9B offering of AIG (AIG) shares if it can’t be done profitably. The stock has fallen from $50 in January to $30.65 yesterday, close to the government’s break-even point of $28.72. Medical Properties Trust (MPW) is moved to Hold from Buy at Jefferies. Barclays PLC (BCS) is lifted to Buy from Hold at Citigroup. In afternoon trading: Actives: Shares of Bank of America (BAC) are down about 0.5%. Shares of Citigroup (C) are down about 2.4%. Shares of JPMorgan (JPM) are down about 1%. Shares of Wells Fargo (WFC) are down about 0.2%. Shares of Fifth Third (FITB) are down about 0.5%.
The Financial Select Sector SPDR (XLF) traded at $16.00 at 4:00 PM on Thursday, unchanged on the day – up 0.31% year-to-date.
Information Technology
Yahoo (YHOO) shares dropped 7.3% after it disclosed that China’s Alibaba Group has transferred control of its Alipay online payment unit to Alibaba CEO Jack Ma for an as yet undetermined amount. Cisco (CSCO) shares fell 3.3% in post-market trading after the company reported that although FQ3 revenue increased 5% to $10.9B, net profit slumped nearly 18% to $0.33 a share. Cisco also gave an FQ4 outlook below analyst forecasts. Laptops that use Google’s (GOOG) Chrome operating system will go on sale in June as the search giant looks to challenge Apple (AAPL) and Microsoft (MSFT) in their backyards, and change the way people use computers. Cisco Systems (CSCO) beat estimates by 5 cents with revenue in-line with estimates. Sina (SINA) missed estimates by 2 cents, but beat revenue by $5M. Symantec (SYMC) beat estimates by 2 cents and revenue by $100M. Auriga U.S.A. has a Hold and $46 price objective on Hewlett-Packard (HPQ). Holds are also assigned on EMC Corporation (EMC) with a $27 target and NetApp (NTAP). Dell Inc (DELL) is begun with a bullish Buy and $25 target. Seagate Technology (STX) is started with a Buy and $29 target price. A Buy is also assigned on Western Digital (WDC) with a $51 target. Cisco Systems (CSCO) is cut by both Canaccord Genuity (Hold from Buy) and Robert W. Baird (Neutral from Outperform).
The Technology Select Sector SPDR (XLK) traded at $26.79 at 4:00 PM on Thursday, up 0.75% on the day – up 6.35% year-to-date.
Telecommunications Services
Senators have expressed concern that AT&T’s (T) $39B purchase of T-Mobile (DTEGY.PK) will harm competition and lead to price rises. In afternoon trading: Shares of Clearwire (CLWR) are down about 13%. Shares of SureWest (SURW) are down about 5.6%. Actives: Shares of Level 3 Communications (LVLT) are up about 1.5%. Shares of Sprint Nextel (S) are up about 0.6%. Shares of AT&T (T) are up about 1.2%. Shares of Verizon (VZ) are up about 0.9%.
The NASDAQ Telecommunications Index (IXTC) traded at $225.30 at 4:00 PM on Thursday, down 0.66% on the day – down 0.03% year-to-date.
Utilities
In afternoon trading: Actives: Shares of American Electric Power (AEP) are up about 2.1%. Shares of AES (AES) are down about 1.2%. Shares of Duke Energy (DUK) are up about 1.4%. Shares of Southern (SO) are up about 1%. Shares of Exelon (EXC) are down slightly. Shares of CenterPoint (CNP) are down about 1.5%.
The Utilities Select Sector SPDR (XLU) traded at $34.07 at 4:00 PM on Thursday, up 1.01% on the day – up 8.71% year-to-date.
STOCKS: RIG, NR, FSLR, CLD, PETD, URZ, IAG, ATI, KRO, GGC, ADES, KNCRF, ZIP, TWIN, GE, XRX, AMR, GLW, KSS, TJX, ROST, AEO, RS, CHH, VRA, DMND, IPSU, CVS, HSY, FBRWY, CVGW, WINN, SPTN, PBH, TSN, TKPHF, CADX, ANAC, GTXI, PGNX, BPAX, CNC, AIG, MPW, BCS, BAC, C, JPM, WFC, FITB, YHOO, CSCO, GOOG, AAPL, MSFT, CSCO, SINA, SYMC, HPQ, EMC, NTAP, DELL, STX, WDC, T, DTEGY, CLWR, SURW, LVLT, S, VZ, AEP, AES, DUK, SO, EXC, CNP
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