Initial Jobless Claims remains elevated at 422,000 well above the recessionary threshold of 350,000. Non-farm Productivity for the first quarter is up 1.8% with Unit Labor Costs up 0.7%. Factory Orders declined 1.2% in April as weak economic data continues. Weak U.S. economic data has been the factor in forcing stocks lower around the globe. The Dow Jones Industrial Average opened slightly higher to 12,306 then trended lower to 12,191 before rebounded briefly into the green above 12,290 in the final hour of trading. The NASDAQ traded down from 2784 at the day’s high to 2759 then rebounded above 2775 in the final hour of trading.
Asian stocks traded lower on Thursday with the Nikkei 225 down 1.7% to 9,555 and the Hang Seng Index down 1.6%. European stocks were also lower on their session with the FTSE 100 down 1.4%, the DAX down 2.0% and the CAC 40 down 1.9%. The yield on the 10-Year U.S. Treasury note is below its 200-day simple moving average at 3.093 percent and traded as low as 2.944 overnight. This yield traded mostly above 3% in Thursday’s U.S. session. Comex gold drifted lower on Thursday from $1545.5 the Troy ounce to $1520.4, then rebounded above $1534 in the afternoon.
Nymex crude oil drifted lower on Thursday from $100.90 per barrel to $98.46 then rebounded back above $100 in the afternoon. The euro stayed above 1.43 and then briefly traded above 1.45 in the afternoon. U.S. stocks took it on the chin on Wednesday with the Dow Industrial Average down 280 points to 12,290 up 6.1% year to date. The NASDAQ was slashed by 66 points to 2769 up 4.4% year to date.
Energy
Arcadia Petroleum, charged last week by the CFTC for manipulating oil prices, allegedly used hardball tactics to monopolize the purchase of oil from Yemen and obtain below-market prices. Inergy (NRGY) is upgraded to Outperform from Neutral with a $42 target at Robert W. Baird. In afternoon trading: Shares of General Maritime (GMR) are up about 10%. Shares of Gastar Exploration (GST) are up about 6.25%. Actives: Shares of Exxon Mobil (XOM) are down about 0.6%. Shares of Petroleo Brasileiro (PBR) are flat. Shares of Halliburton (HAL) are up about 2.75%. Shares of Alpha Natural Resources (ANR) are down about 3.9%. Shares of El Paso (EP) are up slightly.
The Energy Select Sector SPDR (XLE) was trading at $75.24 at 4:00 PM on Thursday, down slightly on the day – up 10.24% year-to-date.
Materials
Mechel Steel (MTL) is begun with a Buy at UBS. Gold Fields (GFI) gets moved to Overweight from Equal Weight with Morgan Stanley. In afternoon trading: Shares of Southern Copper (SCCO) are up about 6.9%. Shares of Century Aluminum (CENX) are up about 4%. Shares of Sealed Air (SEE) are down about 6.25%. Actives: Shares of Freeport McMoran (FCX) are up about 1.1%. Shares of Alcoa (AA) are up about 1.2%. Shares of Cemex (CX) are up about 0.4%. Shares of Vale (VALE) are up about 0.75%.
The Materials Select Sector SPDR (XLB) traded at $38.57 at 4:00 PM on Thursday, up slightly on the day – up 0.42% year-to-date.
Industrials
Shares in Orbitz Worldwide (OWW) sky-rocketed 51% in post-market trading after an Illinois court ordered American Airlines (AMR) to post and sell flights on Orbitz again. Joy Global (JOYG) beat estimates by 27 cents and revenue by $70M. Roadrunner Transportation (RRTS) is a new Outperform at Morgan Keegan with a price objective of $19. Paragon Shipping (PRGN) is cut to Neutral from Buy at UBS. In afternoon trading: Shares of Hill International (HIL) are up about 58.5% after announcing a huge real estate deal in Iraq with a South Korean developer called TRAC Development Group. Shares of Beacon Power (BCON) are up about 9.5%.
The Industrial Select Sector SPDR (XLI) traded at $36.59 at 4:00 PM on Thursday, up 0.52% on the day – up 4.93% year-to-date.
Consumer Discretionary
The U.S. is likely to make a loss of $14B-$16B on the bailouts of the auto industry, a government report said yesterday. Of the $80B provided, less than 20% may be lost, an estimate that’s far better than a projection of 60% two years ago. Shares in for-profit educational firms were up today on news that The Department of Education rolled out a rule that denies federal aid if programs don’t lead to “gainful employment” in a recognized occupation. Expedia (EXPE) and Groupon are launching a travel deals service called Groupon Getaways that will allow people to book hotel rooms and airfares from Expedia at a steep discount. Express (EXPR) is begun with a Buy rating and $26 price target at brokers Brean Murray. Ameristar Casinos (ASCA) gets cut to Sell from Neutral at Goldman. Zumiez (ZUMZ) is now Neutral from Buy at Janney Scott due to macro concerns following May comparative store sales. Cracker Barrel (CBRL) is cut to Hold from Buy at Argus on high commodity cost concerns. In afternoon trading: Shares of Orbitz (OWW) are up about 30.25% after an Illinois court ordered American Airlines (AMR) to post and sell flights on Orbitz again. Shares of Corinthian Colleges (COCO) are up about 28%. Shares of Education Management (EDMC) are up about 23%. Shares of China Education Alliance (CEU) are up about 21.25%. Shares of ITT Educational Services (ESI) are up about 18.5%. Shares of Strayer Education (STRA) are up about 16.25%. Shares of DeVry (DV) are up about 15%.
The Consumer Discretionary Select Sector SPDR (XLY) traded at $39.43 at 4:00 PM on Thursday, down 0.23% on the day – up 5.40% year-to-date.
Consumer Staples
HJ Heinz (HNZ) is hoisted to Buy from Neutral at UBS. Imperial Sugar (IPSU) gets increased to Buy from Neutral at Janney. General Mills (GIS) gets downgraded to Neutral from Buy at UBS. Smucker (SJM) is reduced to Equal Weight from Overweight at Stephens. In afternoon trading: Shares of Star Scientific (CIGX) are up about 11%. Shares of Imperial Sugar are up about 10.75%. Shares of Coca Cola Bottling (COKE) are up about 5.6%. Shares of Fosters Group (FBRWY) are up about 5%. Shares of China-Biotics (CHBT) are down about 7.5%. Shares of Pilgrim’s Pride (PPC) are down about 6.5%. Shares of SuperValu (SVU) are down about 5%.
The Consumer Staples Select Sector SPDR (XLP) traded at $31.61 at 4:00 PM on Thursday, down 1.16% on the day – up 7.85% year-to-date.
Healthcare
Pharmasset (VRUS) is a new Buy and $174 target at Brean Murray. Goldman Sachs gives Incyte (INCY) a Neutral and begins Dendreon (DNDN) at a Buy. Regeneron Pharmaceuticals (REGN) is resumed with an Outperform at Leerink Swann. Johnson & Johnson (JNJ) is upgraded to Outperform from Market Perform at First Global. Affymetrix (AFFX) is now Outperform from Neutral at Robert W. Baird with a new target of $11. AstraZeneca (AZN) is downgraded to Underperform from Hold at Jefferies. In afternoon trading: Shares of Affymetrix are up about 11%. Shares of Zalicus (ZLCS) are up about 5.1%. Shares of Cyberonics (CYBX) are down about 10.5%. Shares of Orexigen Therapeutics (OREX) are down about 6%.
The Health Care Select Sector SPDR (XLV) traded at $35.53 at 4:00 PM on Thursday, down 0.22% on the day – up 12.79% year-to-date.
Financials
The U.S. is likely to make a loss of $14B-$16B on the bailouts of the auto industry, a government report said yesterday. Of the $80B provided, less than 20% may be lost, an estimate that’s far better than a projection of 60% two years ago. New York court has dismissed part of a lawsuit in which bond insurer MBIA (MBI) accused Credit Suisse (CS) of misrepresenting the quality of mortgage-backed securities. STAG Industrial (STIR) is picked up as an Outperform at Keefe Bruyette. In afternoon trading: Shares of Lehman Brothers (LEHMQ:US) are down about 15.25%.
The Financial Select Sector SPDR (XLF) traded at $15.32 at 4:00 PM on Thursday, up slightly on the day – down 3.95% year-to-date.
Information Technology
Many Android users are posting messages on blogs and forums that the Android 2.3 Gingerbread OTA update has bricked some of the Motorola Droid X smartphones for which it was destined. China’s foreign ministry has described as ‘completely unfounded’ Google’s (GOOG) assertions that hackers from Jinan in China ran a campaign to steal hundreds of Gmail passwords, including those of senior U.S. government officials, Chinese political activists, officials in several Asian countries, military personnel and journalists. Microsoft (MSFT) has demonstrated its new operating system, a touch-screen version of Windows that will operate on tablets and personal computers. With the company looking to respond to Apple’s (AAPL) iPad, Windows 8 is the first full edition of the OS capable of running on chips based on technology from ARM Holdings (ARMH), the leading player in the tablet space. Jack Ma, CEO of China’s Alibaba (ALBCF:US), is ‘optimistic’ about reaching an agreement with major shareholders Yahoo! (YHOO) and Softbank (SFTBF:US) over the transfer of Alibaba’s online payments business Alipay to one of his companies. RealD (RLD) is picked up with a Buy at Merriman. Apple (AAPL) is added to the Key Calls list at UBS. Microsoft (MSFT) is upgraded to Buy from Hold at Standpoint Research. In afternoon trading: Shares of Universal Display (PANL) are down about 7.5%. Shares of Brocade Communications (BRCD) are up about 7%. Shares of TiVo (TIVO) are up about 6.25%. Shares of Youku.com (YOKU) are up about 6.25%.
The Technology Select Sector SPDR (XLK) traded at $25.93 at 4:00 PM on Thursday, up slightly on the day – up 2.94% year-to-date.
Telecommunications Services
Many Android users are posting messages on blogs and forums that the Android 2.3 Gingerbread OTA update has bricked some of the Motorola Droid X smartphones for which it was destined. Jack Ma, CEO of China’s Alibaba (ALBCF:US), is ‘optimistic’ about reaching an agreement with major shareholders Yahoo! (YHOO) and Softbank (SFTBF:US) over the transfer of Alibaba’s online payments business Alipay to one of his companies. In afternoon trading: Actives: Shares of Sprint Nextel (S) are up about 2%. Shares of Level 3 Communications (LVLT) are up about 2.5%. Shares of AT&T (T) are down about 0.7%. Shares of Frontier Communications (FTR) are down about a quarter of a percent. Shares of Verizon (VZ) are down slightly.
The NASDAQ Telecommunications Index (IXTC) traded at $220.66 at 4:00 PM on Thursday, up 0.46% on the day – down 2.09% year-to-date.
Utilities
In afternoon trading: Actives: Shares of Duke Energy (DUK) are relatively unchanged. Shares of CenterPoint (CNP) are up about a half of a percent. Shares of Exelon (EXC) are down about a quarter of a percent. Shares of AES (AES) are down about 1.25%. Shares of Genon Energy (GEN) are down about a quarter of a percent. Shares of PPL (PPL) are down about 0.4%.
The Utilities Select Sector SPDR (XLU) traded at $33.42 at 4:00 PM on Thursday, down 0.30% on the day – up 6.64% year-to-date.
STOCKS: NRGY, GMR, GST, XOM, PBR, HAL, ANR, EP, MTL, GFI, SCCO, CENX, SEE, FCX, AA, CX, VALE, OWW, AMR, JOYG, RRTS, PRGN, HIL, BCON, EXPE, EXPR, ASCA, ZUMZ, CBRL, COCO, EDMC, CEU, ESI, STRA, DV, HNZ, IPSU, GIS, SJM, CIGX, COKE, FBRWY, CHBT, PPC, SVU, VRUS, INCY, DNDN, REGN, JNJ, AFFX, AZN, ZLCS, OREX, GOOG, MSFT, AAPL, ARMH, ALBCF, YHOO, SFTBF, RLD, MSFT, PANL, BRCD, TIVO, YOKU, S, LVLT, T, FTR, VZ, DUK, CNP, EXC, AES, GEN, PPL
