Equities Sector Coverage: Greece Solvency Worries Wall Street

Sector Recap |

Greece George PapandreouThe National Association of Home Builders reported that their Housing Market Index dipped to 14 from 15 in September, as the housing depression continues. Tomorrow we get Housing Starts for August and on Wednesday we get Existing Home Sales for August. The FOMC meeting ends Wednesday afternoon. The Dow Jones Industrial Average gapped lower below 11,350 at the open trading to a morning low of 11,255.25. The Dow rebounded in the afternoon trading to above 11,400 into the final hour of trading. The NASDAQ gapped lower at 2584.89 and traded to a morning low of 2564.46. The NASDAQ rebounded into the final hour of trading with a high above its 50-day simple moving average at 2602.

Asian stocks were lower on Monday with the Nikkei 225 closed at 8,864 and the Hang Seng down 2.76% to 18,918. European stocks were lower on continued concerns about Greek debt. The FTSE 100 lost 2.03% to 5,260 with the DAX down 2.83% to 5,416, and the CAC 40 crushed by 3.00% to 2,940. The yield on the 10-Year US Treasury declined from 2.074 to 1.926 as a flight to quality returns to the U.S. markets. Gold traded up to $1832.9 then down to $1771.0 the Troy ounce as that double-top continues to form on the daily chart. Crude oil traded down from $87.75 per barrel to $84.79 continuing to trade between its 200-week simple moving average at $83.71 and its 50- day at $90.13. The euro versus the US dollar slipped from 1.3706 to 1.3590.

Energy

Peabody (BTU) and ArcelorMittal (MT) extended their sweetened $5.2B takeover bid for Macarthur Coal (MACDF) to October 14. Newpark Resources (NR) is a new Buy and $13 price objective at Weeden. TETRA Tech (TTI) is a Hold and $12 target price at Weeden. MarkWest Energy (MWE) is begun with a Buy at Citigroup. Yingli Green Energy (YGE) gets upgraded to Neutral from Sell at Goldman. Suncor Energy (SU) is upgraded to Overweight from Equal Weight by Barclays. In afternoon trading: Shares of Yingli Green Energy are down about 9.6%. Shares of LDK Solar (LDK) are down about 7.6%. Shares of ENI SPA (E) are down about 7.3%.

Energy Select Sector SPDR (XLE) was trading at $66.03 at 4:00 PM on Monday, down 1.58% on the day – down 3.25% year-to-date.

Materials

Peabody (BTU) and ArcelorMittal (MT) extended their sweetened $5.2B takeover bid for Macarthur Coal (MACDF) to October 14. CF Industries (CF) is picked up with a Hold at Citigroup. Cabot (CBT) gets cut to Hold from Buy at Jefferies. Cemex S.A. (CX) gets cut to Underweight from Equal Weight at HSBC Securities with a new price objective of $3.40. In afternoon trading: Shares of Ivanhoe Mines (IVN) are down about 8.1%. Shares of Taseko Mines (TGB) are down about 7.1%. Actives: Shares of Alcoa (AA) are down about 4.5%. Shares of Freeport McMoran (FCX) are down about 4.3%. Shares of Vale (VALE) are down about 2.4%. Shares of Silvercorp (SVM) are down about 3%. Shares of Cemex are down about 5.3%.

The Materials Select Sector SPDR (XLB) was trading at $34.01 at 4:00 PM on Monday, down 1.48% on the day – down 11.56% year-to-date.

Industrials

Four years after spinning off its medical-products and electronic-components units, Tyco (TYC) will divide what's left into three companies. TYC will remain home to its commercial fire and security business, while residential security – ADT – and flow control will be parceled out to shareholders in a tax-free stock dividend. Goodrich (GR) gets picked up with a Hold at Keybanc Capital. BE Aerospace (BEAV) is now Buy from Neutral at UBS. Quanta Services (PWR) is upgraded to Outperform from Underperform at FBR Capital with a new target of $24. Caterpillar (CAT) is downgraded to Outperform from Strong Buy at Raymond James. Hexcel (HXL) is reduced to Sell from Neutral at UBS. IN afternoon trading: Shares of Goodrich are up about 14.5%. Shares of Ingersoll-Rand (IR) are down about 7.1%. Shares of Textron (TXT) are down about 7.1%.

The Industrial Select Sector SPDR (XLI) was trading at $31.67 at 4:00 PM on Monday, down 0.94% on the day – down 9.18% year-to-date.

Consumer Discretionary

Writing on Netflix's (NFLX) corporate blog, CEO Reed Hastings announced the company will be re-branding its DVD-by-mail service as Qwikster and moving it to a separate website from Netflix's video streaming service. Lennar (LEN) said demand for new homes is slowly returning, driven by low home prices and record-low mortgage rates, but added tighter lending standards, high unemployment and weak consumer confidence are capping the upside. General Motors (GM) and the UAW said late Friday they came to terms on a new contract, the first labor deal for any of Detroit's big automakers since the 2009 government bailouts for GM and Chrysler (FIATY). Pier 1 Imports (PIR) is raised to Buy from Hold at Keybanc. Vail Resorts (MTN) is moved to Outperform from Market Perform with Wells Fargo. Michelin (MCGFF) is cut 180 degrees, to Underweight from Overweight at Morgan Stanley. In afternoon trading: Shares of Coldwater Creek (CWTR) are down about 10%. Shares of Blockbuster (BLOAQ) are up about 8.5%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $37.70 at 4:00 PM on Monday, down 0.19% on the day – up 0.78% year-to-date.

Consumer Staples

PepsiCo (PEP) is lowered by 180 degrees, to Underperform from Outperform, at Credit Agricole. In afternoon trading: Shares of AgFeed Industries (FEED) are down about 7.1%. Shares of Imperial Sugar (IPSU) are down about 6.5%. Shares of Alliance One (AOI) are down about 6.5%. Shares of Origin Agritech (SEED) are up about 6.8%. Actives: Shares of PepsiCo are down about 2.4%. Shares of Coca Cola (KO) are down about 1.3%. Shares of Procter & Gamble (PG) are down about 0.6%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $30.58 at 4:00 PM on Monday, down 0.84% on the day – up 4.33% year-to-date.

Healthcare

Bristol-Myers (BMY) is lifted to Buy from Hold at Jefferies with a new target of $35. Cardinal Health (CAH) and McKesson (MCK) are each increased to Buy from Hold at Citigroup. Forest Labs (FRX) is now Sell from Neutral at Goldman. In afternoon trading: Shares of HealthSouth (HLS) are down about 12%. Shares of Gentiva Health Services (GTIV) are down about 11.6%. Shares of Keryx Biosciences (KERX) are down about 7.2%. Shares of MAKO Surgical (MAKO) are up about 13.2%. Shares of Optimer Pharmaceuticals (OPTR) are up about 11.3%. Shares of Regeneron Pharmaceuticals (REGN) are up about 7.9%. Shares of Savient Pharmaceuticals (SVNT) are up about 7.3%.

The Health Care Select Sector SPDR (XLV) was trading at $32.71 at 4:00 PM on Monday, down 0.94% on the day – up 3.84% year-to-date.

Financials

UBS (UBS) said its loss from unauthorized trading is now at $2.3B, up from an earlier estimate of $2B, but continued to dismiss calls for CEO Oswald Gruebel's resignation. Credit Suisse (CS) agreed to pay a €150M ($207M) penalty in Germany to avoid a "complex and prolonged legal dispute" emanating from charges of tax evasion. SEI Investments (SEIC) is reduced to Perform from Outperform at Oppenheimer. UBS AG (UBS) is lowered to Hold from Buy at brokers Collins Stewart. In afternoon trading: Shares of ING Group (ING) are down about 8.2%.

The Financial Select Sector SPDR (XLF) was trading at $12.56 at 4:00 PM on Monday, down 2.67% on the day – down 21.25% year-to-date.

Information Technology

Micron (MU) is lifted to Neutral from Sell at Goldman Sachs. UBS takes Texas Instruments (TXN) to Buy from Neutral along with Analog Devices (ADI), Linear Technology (LLTC), and Maxim Integrated Products (MXIM). Broadcom (BRCM) is boosted to Outperform from Market Perform with brokers William Blair. Advanced Micro Devices (AMD) is now Neutral from Buy at Nomura. Applied Materials (AMAT) is downgraded to Sell from Neutral at Goldman Sachs, which lowers Lam Research (LRCX) to Neutral from Buy. Aixtron (AIXG) is now Neutral from Overweight at HSBC Securities. EZchip (EZCH) is cut to Hold from Buy at Auriga with a new target of $37. JinkoSolar Holding (JKS) is cut to Sell from Neutral at brokerage Collins Stewart with a new target of $10. Power Integrations (POWI) is now Neutral from Overweight at Piper Jaffray. TiVo Inc (TIVO) is taken to Average from Above Average at Caris & Company. In afternoon trading: Shares of JinkoSolar are down about 26.6%. Shares of AsiaInfo-Linkage (ASIA) are down about 18%. Shares of Sequans Communications (SQNS) are up about 9.3%.

The Technology Select Sector SPDR (XLK) was trading at $24.92 at 4:00 PM on Monday, down 0.24% on the day – down 1.07% year-to-date.

Telecommunications Services

AT&T (T) is trying to get rivals including MetroPCS (PCS) and Leap Wireless (LEAP) to sell spectrum and subscribers to rivals like Sprint (S) in the hopes of rescuing its $39B takeover of T-Mobile (DTEGF) from the clutches of a DOJ anti-competition lawsuit. European phone firms Telecom Italia (TI) and Telefonica S.A. (TEF) are each taken to Buy from Hold at the Royal Bank of Scotland. In afternoon trading: Shares of TerreStar (TSTRQ) are down about 16.7%. Actives: Shares of Sprint Nextel (S) are down about 0.6%. Shares of AT&T (T) are down about 1.4%. Shares of Level 3 Communications (LVLT) are down about 1.6%. Shares of Verizon (VZ) are down about 1.3%.

The NASDAQ Telecommunications Index (IXTC) was trading at $194.07 at 4:00 PM on Monday, down 0.88% on the day – down 13.89% year-to-date.

Utilities

In afternoon trading: Actives: Shares of Genon Energy (GEN) are down about 3.3%. Shares of Duke Energy (DUK) are relatively unchanged. Shares of AES Corp (AES) are down about 1.3%. Shares of Exelon (EXC) are down slightly. Shares of Southern (SO) are down about 0.4%. Shares of American Electric Power (AEP) are up slightly. Shares of CMS Energy (CMS) are down slightly.

The Utilities Select Sector SPDR (XLU) was trading at $33.79 at 4:00 PM on Monday, down 0.56% on the day – up 7.82% year-to-date.

STOCKS: BTU, MT, MACDF, NR, TTI, MWE, YGE, SU, LDK, E, CF, CBT, CX, IVN, TGB, AA, FCX, VALE, SVM, TYC, GR, BEAV, PWR, CAT, HXL, IR, TXT, NFLX, LEN, GM, FIATY, PIR, MTN, MCGFF, CWTR, BLOAQ, PEP, FEED, IPSU, AOI, SEED, KO, PG, BMY, CAH, MCK, FRX, HLS, GTIV, KERX, MAKO, OPTR, REGN, SVNT, UBS, CS, SEIC, ING, MU, TXN, ADI, LLTC, MXIM, BRCM, AMD, AMAT, LRCX, AIXG, EZCH, JKS, POWI, TIVO, ASIA, SQNS, T, PCS, LEAP, S, DTEGY, TI, TEF, TSTRQ, S, T, LVLT, VZ, GEN, DUK, AES, EXC, SO, AEP, CMS

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
AA Alcoa Inc. 9.68 -0.08 -0.82 10,109,724
ADI Analog Devices Inc. 62.28 -0.95 -1.50 3,196,399
AEP American Electric Power Company 66.36 -0.30 -0.45 1,745,753
AES The AES Corporation 13.12 -0.14 -1.06 2,636,128
AIXG Aixtron SE 6.11 0.00 0.00 9,622
AMAT Applied Materials Inc. 29.35 -0.31 -1.05 12,608,710
AMD Advanced Micro Devices Inc. 6.32 -0.23 -3.51 29,867,092
AOI Alliance One International Inc. 21.54 -1.06 -4.69 17,594
BEAV B/E Aerospace Inc. 50.12 0.13 0.26 720,289
BMY Bristol-Myers Squibb Company 55.48 -1.00 -1.77 8,597,172
BRCM Broadcom Corp. n/a n/a n/a 0
BTU Peabody Energy Corp n/a n/a n/a 0
CAH Cardinal Health Inc. 76.88 -0.78 -1.00 1,700,611
CAT Caterpillar Inc. 82.37 -0.07 -0.08 3,340,788
CBT Cabot Corporation 51.63 0.26 0.51 185,250
CF CF Industries Holdings Inc. 22.64 0.01 0.04 4,950,648
CMS CMS Energy Corporation 44.02 0.15 0.34 2,008,535
CX Cemex S.A.B. de C.V. Sponsored ADR 7.55 -0.18 -2.33 10,192,765
DUK Duke Energy Corporation (Holding Company) 82.15 -0.37 -0.45 2,718,086
EXC Exelon Corporation 34.82 0.02 0.06 3,545,719
EZCH EZchip Semiconductor Ltd n/a n/a n/a 0
FCX Freeport-McMoRan Inc. 10.51 -0.12 -1.13 24,054,409
GEN Genesis Healthcare Inc. 2.71 -0.01 -0.37 149,647
GM General Motors Company 31.80 -0.32 -1.00 12,700,400
HLS HealthSouth Corporation 40.52 -0.37 -0.90 576,209
HXL Hexcel Corporation 43.32 -0.19 -0.44 188,774
ING ING Group N.V. 12.14 -0.19 -1.54 2,625,614
IR Ingersoll-Rand plc (Ireland) 65.39 0.74 1.14 2,376,759
IVN Ivanhoe Mines Ltd n/a n/a n/a 0
JKS JinkoSolar Holding Company Limited American Deposi 15.03 -0.15 -0.99 318,162
KERX Keryx Biopharmaceuticals Inc. 5.10 -0.15 -2.86 1,025,674
KO Coca-Cola Company (The) 42.05 -0.69 -1.61 15,035,305
LEN Lennar Corporation Class A 42.95 -0.16 -0.37 2,066,113
LLTC Linear Technology Corporation 58.72 -0.15 -0.25 1,667,523
LRCX Lam Research Corporation 91.41 -0.37 -0.40 1,702,702
LVLT Level 3 Communications Inc. 47.03 -0.52 -1.09 2,285,794
MCK McKesson Corporation 165.18 -1.90 -1.14 1,481,367
MT ArcelorMittal 6.06 0.00 0.00 15,789,902
MTN Vail Resorts Inc. 155.80 -4.76 -2.96 688,815
MU Micron Technology Inc. 17.36 -0.12 -0.69 19,551,629
MWE MarkWest Energy Partners LP n/a n/a n/a 0
MXIM Maxim Integrated Products Inc. 38.65 -0.35 -0.90 2,170,935
NFLX Netflix Inc. 94.56 -1.38 -1.44 6,738,293
NR Newpark Resources Inc. 6.63 -0.18 -2.64 326,536
PEP Pepsico Inc. 107.03 -0.31 -0.29 4,436,505
PG Procter & Gamble Company (The) 87.85 0.09 0.10 60,276,563
PIR Pier 1 Imports Inc. 4.11 -0.25 -5.73 1,944,522
POWI Power Integrations Inc. 60.24 -1.17 -1.91 98,204
PWR Quanta Services Inc. 26.45 0.24 0.92 2,012,710
REGN Regeneron Pharmaceuticals Inc. 404.12 -6.27 -1.53 658,631
S Sprint Corporation 6.65 0.01 0.15 13,899,470
SEED Origin Agritech Limited 2.34 0.04 1.74 190,175
SEIC SEI Investments Company 45.38 -0.70 -1.52 510,599
SO Southern Company (The) 53.31 -0.22 -0.41 4,689,555
SQNS Sequans Communications S.A. American Depositary Sh 1.65 -0.02 -1.20 293,049
SU Suncor Energy Inc. 26.21 -0.27 -1.02 5,912,389
T AT&T Inc. 41.14 -0.14 -0.34 16,646,906
TEF Telefonica SA 10.42 -0.20 -1.88 1,022,253
TGB Taseko Mines Ltd. 0.48 0.00 0.23 58,760
TI Telecom Italia S.P.A. New 8.27 -0.21 -2.48 64,245
TTI Tetra Technologies Inc. 5.52 -0.08 -1.43 533,232
TTT.R.W TERRA NOVA ROYALTY CORP RTS WI n/a n/a n/a 0
TXN Texas Instruments Incorporated 68.42 -0.56 -0.81 3,475,623
TXT Textron Inc. 39.20 -0.25 -0.63 561,802
TYC Tyco International plc (Ireland) n/a n/a n/a 0
UBS UBS Group AG Registered 13.45 -0.36 -2.61 2,160,001
VALE VALE S.A. American Depositary Shares Each Represen 5.38 -0.04 -0.74 13,012,031
VZ Verizon Communications Inc. 52.15 -0.41 -0.78 10,558,019
YGE Yingli Green Energy Holding Company Limited ADR 3.94 0.05 1.29 55,919

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