Equities Sector Coverage: Consumer Staples Lone Gainer As Stocks Fall

Sector Recap |

Kraft KFTImport Prices rose by 0.3% in July and by 14% year over year. Housing Starts fell 1.5% in July to an annual rate of 604,000 with single family starts down 4.9% to 425,000. Building Permits declined 3.2% to 597,000. Industrial Production rose by 0.9% in July, stronger than expected. Capacity Utilization increased to 77.5% the highest since August 2008. The Dow Jones Industrial Average ended Monday 8.3% above the post-FOMC low at 10,604 with the NASDAQ up 9.6% off its week ago low at 2332. The Dow traded lower Tuesday morning down to 11,352.58 then up to 11,488.01 following the press conference by French President Nicolas Sarkozy and Germany Chancellor Angela Merkel saying they will support the euro. Upon second thought the real reaction to the press conference was a market reversal to an afternoon low at 11,292.63. The NASDAQ traded down from 2531.99 to 2515.76 then up to 2546.74 then down to 2494.55. Both the Dow and NASDAQ entered the last half hour of trading closer to the day’s highs.

Asian stocks were mixed on Tuesday after strong opens following the Dow’s 214 point gain on Monday. The Nikkei 225 ended up just 0.23% to 9,107 with the Hang Seng down 0.24% to 20,212. European stocks opened lower following news that Germany’s latest GDP report showed a rise of just 0.1%. As the European sessions progressed markets recovered losses ending mixed. The FTSE 100 inched up 0.13% to 5,358. The DAX shed 0.45% to 5,995. The CAC 40 slipped 0.25% to 3,231. The yield on the 10-Year US Treasury note traded down from 2.317 percent to 2.198 on a modest flight to quality. Gold stayed below last Thursday’s all time high at $1817.6 the Troy ounce with a trading range between $1763.6 and $1789.8 with a close near the day’s high. Crude oil traded down from $87.69 to $85.62 then up to $87.93 then closed about mid-range. The euro versus the US dollar traded down from 1.4454 to 1.4357 then up to 1.4466 then consolidated.

Energy

Carl Icahn reported new stakes In Vector Group (VGR) and El Paso (EP). Hess (HES) is hoisted to Buy from Sell at The Benchmark Company with a new target of $70. Cal Dive International (DVR) is moved to Outperform from Perform at Morgan Keegan. In afternoon trading: Shares of Denison Mines (DNN) are down about 9%. Shares of GMX Resources (GMXR) are down about 8.75%. Shares of Key Energy Services (KEG) are down about 7.25%. Shares of Uranium Resources (URRE) are down about 7%.

Energy Select Sector SPDR (XLE) was trading at $68.07 at 4:00 PM on Tuesday, down 1.66% on the day – down 0.26% year-to-date.

Materials

Albemarle (ALB) is downgraded to Underperform from Perform at Oppenheimer. In afternoon trading: Shares of China GengSheng Minerals (CHGS) are down about 10.5%. Shares of US Energy (USEG) are down about 9.25%. Shares of Albemarle are down about 8.75%. Shares of Avalon Rare Metals (AVL) are down about 7%. Shares of ArcelorMittal (MT) are down about 5.5%. Shares of Stillwater Mining (SWC) are down about 5%.

The Materials Select Sector SPDR (XLB) traded at $34.43 at 4:00 PM on Tuesday, down 1.60% on the day – down 10.36% year-to-date.

Industrials

Berkshire Hathaway's (BRK.A) latest 13-F filing showed it bought stakes in Verisk Analytics (VRSK) and Dollar General (DG). Berkshire also increased its holdings in Wells Fargo (WFC) and Mastercard (MA), but reduced its position in Kraft (KFT). KAR Auction Services (KAR) is upgraded to Outperform from Market Perform at Barrington Research. Watsco (WSO) is raised to Buy from Hold at BB&T Capital. In afternoon trading: Shares of American Superconductor (AMSC) are down about 8.25%. Shares of SatCon Tech (SATC) are down about 7.25%. Shares of Terex (TEX) are down about 6.5%. Shares of The Manitowoc Company (MTW) are down about 6%.

The Industrial Select Sector SPDR (XLI) traded at $31.42 at 4:00 PM on Tuesday, down 1.41% on the day – down 9.89% year-to-date.

Consumer Discretionary

Home Depot's (HD) Q2 earnings beat expectations as net profit climbed to $0.86 per diluted share from $0.72 and sales increased 4.2% to $20.2B. Home Depot also raised its 2011 profit guidance and now expects EPS "to be up approximately 16% to $2.34" vs. consensus of $2.30. Berkshire Hathaway's (BRK.A) latest 13-F filing showed it bought stakes in Verisk Analytics (VRSK) and Dollar General (DG). Berkshire also increased its holdings in Wells Fargo (WFC) and Mastercard (MA), but reduced its position in Kraft (KFT). John Paulson slashed his holdings in Bank of America (BAC) and Comcast (CMCSA) but increased his positions in Capital One (COF) and Wells Fargo (WFC). Saks (SKS) beat estimates by 4 cents and revenue by $6.3M. Dick's Sporting Goods (DKS) beat estimates by 2 cents, but missed revenue by $10M, and sees FY11 EPS of $1.94-1.96. Home Depot (HD) beat estimates by 4 cents and revenue by $240M, and raised FY11 EPS guidance to $2.34 from $2.24 earlier. Urban Outfitters (URBN) beat estimates by 3 cents and revenue by $5M. Priceline.com (PCLN) is initiated with a Reduce at Nomura, which has new Neutrals on Expedia (EXPE) and Orbitz (OWW). Toll Brothers (TOL) is upgraded to Hold from Sell at Stifel Nicolaus. Time Warner Cable (TWC) is taken to Neutral from Outperform at Macquarie. In afternoon trading: Shares of SodaStream International (SODA) are down about 21.75%. Shares of E-Commerce China Dangdang (DANG) are down about 14.5%. Shares of Urban Outfitters are down about 8.25%. Shares of Fossil (FOSL) are down about 8%.

The Consumer Discretionary Select Sector SPDR (XLY) traded at $36.40 at 4:00 PM on Tuesday, down 0.55% on the day – down 2.70% year-to-date.



Consumer Staples

Wal-Mart (WMT) beat estimates by a penny in Q2 as diluted EPS rose 12.4% to $1.09 and revenues climbed 5.5% to $108.6B. Walmart International increased its net sales 16.2% to $30.1B, although U.S. sales fell 0.9%. The retailer raised its full year EPS guidance range to $4.41-$4.51. Berkshire Hathaway's (BRK.A) latest 13-F filing showed it bought stakes in Verisk Analytics (VRSK) and Dollar General (DG). Berkshire also increased its holdings in Wells Fargo (WFC) and Mastercard (MA), but reduced its position in Kraft (KFT). Carl Icahn reported new stakes In Vector Group (VGR) and El Paso (EP). Constellation Brands (STZ) is covered with a Buy at Capstone. Unilever PLC (UN) is upgraded to Outperform from Underperform at BNP Paribas. Estee Lauder (EL) is increased to Outperform from Market Perform by BMO Capital with a new target of $115. Spectrum Brands (SPB) is now Buy from Neutral at Suntrust. In afternoon trading: Shares of Central European Distribution (CEDC) are down about 7%. Shares of Prestige Brands (PBH) are down about 7.25%. Shares of USANA Health Sciences (USNA) are down about 6.5%.

The Consumer Staples Select Sector SPDR (XLP) traded at $30.03 at 4:00 PM on Tuesday, up 0.23% on the day – up 2.46% year-to-date.

Healthcare

Carlyle is in talks to buy Pharmaceutical Product Development (PPDI), a drug R&D outsourcing firm, for up to $4.3B, versus a closing price of $31.51 (valuing the company at $3.59B). Allergan (AGN) is upgraded to Outperform from Neutral at Credit Suisse. Alnylam Pharma (ALNY) is increased to Overweight from Neutral at Piper Jaffray. Charles River Laboratories (CRL) is lifted to Neutral from Sell at Lazard. In afternoon trading: Shares of Complete Genetics (GNOM) are down about 10.5%. Shares of Corcept Therapeutics (CORT) are dowm about 6.75%. Shares of Five Star Quality Care (FVE) are down about 6.5%. Shares of ImmunoGen (IMGN) are down about 6%. Shares of XOMA Ltd. (XOMA) are UP about 8%.

The Health Care Select Sector SPDR (XLV) traded at $32.14 at 4:00 PM on Tuesday, down slightly on the day – up 2.03% year-to-date.

Financials

Berkshire Hathaway's (BRK.A) latest 13-F filing showed it bought stakes in Verisk Analytics (VRSK) and Dollar General (DG). Berkshire also increased its holdings in Wells Fargo (WFC) and Mastercard (MA), but reduced its position in Kraft (KFT). John Paulson slashed his holdings in Bank of America (BAC) and Comcast (CMCSA) but increased his positions in Capital One (COF) and Wells Fargo (WFC). Macquarie rolls out Outperforms on Arthur J. Gallagher (AJG), Aon (AON), and Marsh & McLennan (MMC). Entertainment Properties (EPR) gets picked up at a Neutral by Goldman Sachs. In afternoon trading: Shares of NYSE Euronext (NYX) are down about 10%. Shares of Intercontinental Exchange (ICE) are down about 5.5%. Shares of Radian Group (RDN) are down about 5.5%.

The Financial Select Sector SPDR (XLF) traded at $12.93 at 4:00 PM on Tuesday, down 1.97% on the day – down 18.93% year-to-date.

Information Technology

Handset makers that use Android [Samsung (SSNLF), Sony Ericsson (SNE) (ERIC), HTC (HTCKF) and LG Electronics] have released statements supporting Google's (GOOG) proposed $12.5B purchase of Motorola Mobility (MMI) amid reassurances from Google it won't show favoritism to the unit. Evergreen Solar (ESLR) filed for Chapter 11 bankruptcy, surrendering in its battle against strong Chinese competition and slumping European demand. Netlist (NLST) reported that Q2 easily topped estimates on a 197% jump in flash drive shipments. Agilent Technologies (A) beat estimates by 4 cents with revenue in-line with estimates, and expects Q4FY11 revenue at $1.74B-$1.79B and Non-GAAP EPS at $0.79-$0.81 and expects FY11 revenue at $6.64B-$6.66B and Non-GAAP EPS at $2.90-$2.92. Germany software giant SAP AG (SAP) is a new Market Perform at Morgan Keegan, which assigns identical ratings on Concur Tech (CNQR) and Informatica (INFA). The broker begins Salesforce.com (CRM) at Outperform - $165 price objective and Oracle (ORCL) at Outperform - $33 target price. Open Text (OTEX) is a new Outperform at Morgan Keegan. Research In Motion (RIMM) is reduced to Sell from Hold at Societe Generale. Motorola Mobility (MMI) is moved to Neutral from Buy at Goldman. SinoHub (SIHI) is downgraded to Perform from Outperform at Rodman & Renshaw. In afternoon trading: Shares of Vanceinfo Technologies (VIT) are down about 31% after issuing disappointing earnings and guidance. Shares of Youku.com (YOKU) are down about 11.25%. Shares of Fabrinet (FN) are up about 17.5%. Shares of Netlist are up about 10.25%.

The Technology Select Sector SPDR (XLK) traded at $24.37 at 4:00 PM on Tuesday, down 0.73% on the day – down 3.26% year-to-date.

Telecommunications Services

Sprint Nextel (S) is now Buy from Neutral with a $5 price target at Collins Stewart. In afternoon trading: Shares of Leap Wireless (LEAP) are up about 7.5%. Actives: Shares of Sprint Nextel are up about 4%. Shares of AT&T (T) are down about 0.4%. Shares of Level 3 Communications (LVLT) are down about 3.5%. Shares of Verizon (VZ) are down about 0.8%. Shares of Frontier Communications (FTR) are down about 1.1%. Shares of Vodafone (VOD) are down about 0.6%. Shares of MetroPCS (PCS) are down about 0.6%.

The NASDAQ Telecommunications Index (IXTC) traded at $192.35 at 4:00 PM on Tuesday, down 0.88% on the day – down 14.65% year-to-date.

Utilities

Edison International (EIX) is now Buy from Neutral at Goldman. Goldman also adds both El Paso Electric (EE) and PPL Corp (PPL) to its Conviction Buy List. Foreign energy firms E ON AG (EONGY) and RWE AG (RWEOY) are both boosted to Buy from Neutral at Goldman. PG&E (PCG) gets pulled from the Conviction Buy List at Goldman. Tri-Tech Holding (TRIT) is taken to Hold from Buy at Brean Murray. In afternoon trading: Shares of Tri-Tech Holding are down about 12.25%. Shares of RWE AG are down about 7.1%. Shares of Veolia Environment (VE) are down about 6.4%. Shares of Tokyo Electric Power (TKECF) are down about 5.1%.

The Utilities Select Sector SPDR (XLU) traded at $32.74 at 4:00 PM on Tuesday, down slightly on the day – up 4.47% year-to-date.

STOCKS: VGR, EP, HES, DVR, DNN, GMXR, KEG, URRE, ALB, CHGS, USEG, AVL, MT, SWC, BRK.A, VRSK, DG, WFC, MA, KFT, KAR, WSO, AMSC, SATC, TEX, MTW, HD, BAC, CMCSA, COF, WFC, SKS, DKS, URBN, PCLN, EXPE, OWW, TOL, TWC, SODA, DANG, FOSL, WMT, VGR, EP, STZ, UN, EL, SPB, CEDC, PBH, USNA, PPDI, AGN, ALNY, CRL, GNOM, CORT, FVE, IMGN, XOMA, AJG, AON, MMC, EPR, NYX, ICE, RDN, SSNLF, SNE, ERIC, GOOG, MMI, ESLR, NLST, A, SAP, CNQR, INFA, CRM, ORCL, OTEX, RIMM, SIHI, VIT, YOKU, FN, S, LEAP, T, LVLT, VZ, FTR, VOD, PCS, EIX, EE, PPL, EONGY, RWEOY, PCG, TRIT, VE, TKECF

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
DNN Denison Mines Corp (Canada) 0.42 0.00 0.00 27,795
ORCL Oracle Corporation 49.21 -0.15 -0.29 2,872,835 Trade
FN Fabrinet 37.25 0.65 1.78 35,646 Trade
A Agilent Technologies Inc. 67.32 0.44 0.66 194,613 Trade
FTR Frontier Communications Corporation 11.56 0.08 0.73 224,379 Trade
CRL Charles River Laboratories International Inc. 115.35 0.00 0.00 18,193 Trade
HES Hess Corporation 45.11 0.06 0.13 402,301 Trade
MTW Manitowoc Company Inc. (The) 8.96 0.03 0.34 88,675 Trade
NEOS Neos Therapeutics Inc. 7.40 -0.10 -1.33 72,881 Trade
CRM Salesforce.com Inc 97.96 0.77 0.79 518,183 Trade
ICE Intercontinental Exchange Inc. 66.65 -0.20 -0.30 957,212 Trade
PCG Pacific Gas & Electric Co. 58.27 1.27 2.23 2,614,539 Trade
CORT Corcept Therapeutics Incorporated 18.51 0.21 1.15 96,495 Trade
AMSC American Superconductor Corporation 4.34 -0.02 -0.47 3,979 Trade
KAR KAR Auction Services Inc 47.92 -0.09 -0.19 38,517 Trade
TWC Time Warner Cable Inc n/a n/a n/a 0 Trade
SWC Stillwater Mining Company ($0.01 Par Value) n/a n/a n/a 0 Trade
FOSL Fossil Group Inc. 9.10 0.18 2.02 168,302 Trade
WMT Wal-Mart Stores Inc. 86.39 -0.01 -0.01 1,105,610 Trade
NLST Netlist Inc. 0.64 -0.01 -1.54 26,322 Trade
VRSK Verisk Analytics Inc. 85.11 0.20 0.23 80,319 Trade
URRE Uranium Resources Inc. n/a n/a n/a n/a
FVE Five Star Quality Care Inc. 1.55 0.00 0.00 1,188 Trade
EL Estee Lauder Companies Inc. (The) 109.43 -0.27 -0.25 163,640 Trade
EXPE Expedia Inc. 153.51 0.11 0.07 157,269 Trade
ALNY Alnylam Pharmaceuticals Inc. 112.67 -2.97 -2.56 270,552 Trade
S Sprint Corporation 7.01 -0.06 -0.85 1,535,633 Trade
PPL PPL Corp 37.82 0.01 0.01 481,694 Trade
EIX Edison International 79.43 -0.04 -0.05 257,998 Trade
RDN Radian Group Inc. 20.64 0.17 0.83 222,121 Trade
PCLN The Priceline Group Inc. 1,945.74 17.88 0.93 69,024 Trade
ALB Albemarle Corporation 140.85 1.36 0.97 200,429 Trade
VOD Vodafone Group Plc 28.97 0.04 0.14 457,687 Trade
TOL Toll Brothers Inc. 43.98 0.02 0.05 97,969 Trade
SODA SodaStream International Ltd. 61.76 -0.54 -0.87 25,099 Trade
VGR Vector Group Ltd. 20.84 0.10 0.48 75,202 Trade
USEG U.S. Energy Corp. 1.04 -0.02 -1.88 4,411 Trade
ERIC Ericsson 6.44 0.54 9.15 6,573,445 Trade
LVLT Level 3 Communications Inc. 52.96 0.18 0.34 119,702 Trade
AGN Allergan plc 190.59 1.32 0.70 807,769 Trade
OTEX Open Text Corporation 33.78 -0.08 -0.24 129,308 Trade
UN Unilever NV 56.69 -0.96 -1.67 774,334 Trade
VZ Verizon Communications Inc. 49.17 -0.05 -0.09 2,586,027 Trade
MMC Marsh & McLennan Companies Inc. 84.62 0.33 0.39 261,128 Trade
BAC Bank of America Corporation 27.06 0.48 1.81 25,653,397 Trade
DG Dollar General Corporation 83.73 0.82 0.99 186,042 Trade
COF Capital One Financial Corporation 89.10 1.62 1.85 1,007,226 Trade
DANG E-Commerce China Dangdang Inc. American Depositary n/a n/a n/a 0 Trade
GOOG Alphabet Inc. 990.41 5.96 0.61 210,584 Trade
WSO Watsco Inc. 160.15 0.85 0.53 75,129 Trade
AJG Arthur J. Gallagher & Co. 63.04 0.40 0.64 61,029 Trade
SPB Spectrum Brands Holdings Inc. 110.62 0.58 0.53 52,715 Trade
EPR EPR Properties 70.64 -0.05 -0.07 40,412 Trade
URBN Urban Outfitters Inc. 24.61 0.89 3.75 579,179 Trade
TEX Terex Corporation 45.67 -0.08 -0.17 47,845 Trade
EE El Pasoectric Company 57.40 0.00 0.00 20,941 Trade
HD Home Depot Inc. (The) 163.33 0.09 0.06 609,015 Trade
IMGN ImmunoGen Inc. 5.98 -0.19 -3.08 583,199 Trade
KEG Key Energy Services Inc. 11.03 -0.06 -0.50 6,389 Trade
WFC Wells Fargo & Company 54.91 1.16 2.16 5,703,809 Trade
MT ArcelorMittal 29.76 0.42 1.43 873,459 Trade
DKS Dick\'s Sporting Goods Inc 26.81 0.81 3.12 325,047 Trade
PBH Prestige Brand Holdings Inc. 48.13 0.17 0.35 35,077 Trade
SAP SAP SE ADR (Sponsored) 112.37 -1.03 -0.91 189,536 Trade
YOKU Youku Tudou Inc ADR (Sponsored) n/a n/a n/a 0 Trade
AON Aon plc Class A (UK) 151.76 0.94 0.62 89,308 Trade
SNE Sony Corporation 37.57 0.13 0.35 62,691 Trade
T AT&T Inc. 35.49 -0.20 -0.56 6,740,148 Trade
USNA USANA Health Sciences Inc. 61.15 0.50 0.82 7,159 Trade
MMI Marcus & Millichap Inc. 27.57 0.36 1.32 22,969 Trade
CMCSA Comcast Corporation Class A Common Stock 36.97 0.07 0.18 2,385,734 Trade
XOMA XOMA Corporation 22.96 -0.31 -1.33 29,103 Trade

Comments

Emerging Growth

Taranis Resources Inc.

Taranis Resources Inc is an exploration stage company. The Company along with its subsidiaries is engaged in the acquisition and exploration of mineral properties. Its projects include Thor Property in…

Private Markets

Quants Inc

Quants, Inc, a California Corporation, develops, markets and operates financial technology platforms and alternative investment products offering sophisticated risk management since 2010. The Company has primarily sharpened its focus with…

Voleo

Voleo is a free download that allows you to form investment clubs with your friends, family, colleagues, classmates, teammates…basically anyone you know and trust. Invest and manage a stock portfolio…