Equities Sector Coverage: Optimism for Easing Continues to Push Markets Higher

Sector Recap |

Optimism for Easing Continues to Push Markets HigherThe US Trade Deficit widened to a less than expected $42.0 billion in July from $41.9 billion in June. The Dow Jones Industrial Average traded up to a day’s high at 13,354.34. The NASDAQ traded up to 3117.86 on Tuesday morning then faded slightly into the red going into the final half hour of trading.

Asian stocks were mixed on Tuesday. The Nikkei 225 ended the day at 8,807 – down 0.70%. The Hang Seng ended the day at 19,858 – up 0.15%. European exchanges opened lower on Tuesday, but rebounded to mixed closes with eyes on the FOMC for additional quantitative easing. The FTSE 100 ended the day at 5,790 – down 0.05%. The DAX ended the day at 7,311 – up 1.35%. The CAC 40 ended the day at 3,537 – up 0.89%. The yield on the 10-Year US Treasury rose from 1.646% to 1.704% staying above its 50-day simple moving average at 1.594% with the 200-day at 1.835%.

Comex gold traded up from $1728.0 the Troy ounce to $1740.5 well above the 50-day and 200-day simple moving averages at $1626.4 and $1646.4. Nymex crude oil rebounded from $96.08 per barrel to $97.31 versus the 200-day simple moving average at $96.61. The euro versus the dollar traded down to 1.2758 then up to 1.2869 above the 200-day simple moving average at 1.2833.

Energy

Spectra Energy (SE) is teaming up with BG Group (BRGXF) to build a new 525-mile natural gas pipeline in British Columbia to take as much as 4.2B cubic feet a day of gas from the province's shale fields to a proposed LNG-export facility. Clean Energy Fuels (CLNE) is a Hold at Jefferies.

Dow components – Chevron (CVX) up 0.35%, Exxon Mobil (XOM) up 0.21%.

Energy Select Sector SPDR (XLE) was trading at $73.92 at 3:30 PM on Tuesday, up 1.08% on the day – up 6.93% year-to-date.

Materials

Ball Corp. (BLL) is begun with a Buy at Citigroup. Crown Holdings (CCK) is assumed with a Buy at Citigroup. Eastman Chemical (EMN) is a Hold at Jefferies. AngloGold (AU) is initiated with an Outperform at Credit Suisse, which has a new Neutral on Gold Fields (GFI) and an Underperform on Harmony Gold (HMY). Intrepid Potash (IPI) is initiated with a Buy at Wunderlich. Sealed Air (SEE) is a new Neutral at Citigroup. Louisiana-Pacific (LPX) is lowered to Underperform from Outperform at Crédit Agricole. Owens-Illinois (OI) is slashed to Neutral from Buy at Citigroup. Quaker Chemical (KWR) is moved to Neutral from Buy at Janney Montgomery Scott.

Dow Components – Alcoa (AA) up 2.87%, DuPont (DD) up 0.89%.

The Materials Select Sector SPDR (XLB) was trading at $37.00 at 3:30 PM on Tuesday, up 0.30% on the day – up 10.45% year-to-date.

Industrials

Philips Electronics (PHG) has increased its cost-savings goal to €1.1B from €800M as it looks to address inefficiency at its healthcare and lighting divisions. The Pentagon has refrained from authorizing a plan for operational testing of Lockheed Martin's (LMT) F-35 Joint Strike Fighter program, with officials expressing frustration at the pace of development in a "very painful" review on Friday.

Big Movers – A123 Systems (AONE) up 21.67%.
Dow components – Boeing Co (BA) up 0.35%, Caterpillar (CAT) up 1.63%, General Electric (GE) up 0.65%, 3M Company (MMM) up 0.74%, United Technologies (UTX) up 0.11%.

The Industrial Select Sector SPDR (XLI) was trading at $36.96 at 3:30 PM on Tuesday, up 0.54% on the day – up 9.51% year-to-date.

Consumer Discretionary

Digital Domain (DDMG) has filed for bankruptcy protection after last week defaulting on debt repayments of $35M in senior notes, and the resignation of Chairman and CEO John Textor. R.G. Barry (DFZ) beat estimates by 5 cents and revenue by $3M. Five Below (FIVE) beat estimates by 2 cents and revenue by $4M. Shuffle Master (SHFL) missed estimates by 2 cents and revenue by $4.6M. Comcast (CMCSA) is initiated with a Buy at Janney Capital. Burberry (BURBY) is lowered to Neutral from Buy at Nomura. Coach (COH) is downgraded to Hold from Buy at Brean Murray.

Big Movers – K12 Inc. (LRN) down 13.90%.
Dow Components – Disney (DIS) up 0.17%, Home Depot (HD) down 1.02%, McDonalds (MCD) up 0.10%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $46.67 at 3:30 PM on Tuesday, down 0.09% on the day – up 19.61% year-to-date.

Consumer Staples

United Natural Foods (UNFI) reported FQ4 EPS of $0.51 (in-line) on revenue of $1.34B (in-line). Casey's General Stores (CASY) beat estimates by 6 cents, while missing revenue by $60M. Dow components – Kraft (KFT) down 1.23%, Coca Cola (KO) up 0.32%, Procter & Gamble (PG) down 0.17%, Wal-Mart (WMT) up 0.85%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $35.63 at 3:30 PM on Tuesday, down 0.25% on the day – up 9.66% year-to-date.



Health Care

Walgreens (WAG), Merck (MRK) and Oneok (OKE) led 14 companies in selling nearly $19B worth of debt yesterday, making it the biggest day for investment-grade bond issuance since September 8, 2010, and the third busiest on record. Bristol-Myers Squibb (BMY) and Johnson & Johnson are both a new Neutrals at Credit Suisse. IntelliPharmaCeutics (IPCI) is begun with a Buy at Brean Murray. Life Technologies (LIFE) is launched with a Buy at WallachBeth. Bristol-Myers Squibb (BMY) is boosted to Conviction Buy from Buy at Goldman Sachs. Catamaran Corp (CTRX) is upgraded to Conviction Buy from Buy at Goldman Sachs. AmerisourceBergen (ABC) is now Neutral from Conviction Buy at Goldman Sachs. Navidea Biopharmaceuticals (NAVB) is now Hold from Buy at ThinkEquity. Watson Pharmaceuticals (WPI) is downgraded to Buy from Conviction Buy at Goldman Sachs.

Big Movers – Sunesis Pharmaceuticals (SNSS) up 32.20%, Complete Genomics (GNOM) down 10.86%.
Dow Components – Johnson & Johnson (JNJ) up 0.23%, Merck (MRK) up 0.34%, Pfizer (PFE) up 0.25%.

The Health Care Select Sector SPDR (XLV) was trading at $39.40 at 3:30 PM on Tuesday, up 0.03% on the day – up 13.58% year-to-date.

Financial

The government and the Fed have made a minimum profit of $12.4B on the $182.3B bailout of AIG (AIG) after the Treasury raised $18B by selling 554M shares at $32.50 each, with the insurer purchasing about $5B. Deutsche Bank's (DB) co-CEOs have unveiled their plans to deliver return to shareholders in a lousy macro environment for investment banking, promising €4.5B in annual savings by 2015 - greater than the €3B floated two months ago. Morgan Stanley (MS) has scored a victory after consultant Perella Weinberg valued Morgan Stanley Smith Barney at below $15B. Barclays (BCS) could significantly shrink its controversial tax structuring unit, which at its peak earned up to 75% of the profits at the company's investment banking operations, as the firm looks to restore its reputation. Moody's has kept its negative outlook on U.K. banks, due to the travails of the British and eurozone economies. The agency said the likes of RBS (RBS), Lloyds (LYG) and Barclays (BCS) could also be hit by high regulatory costs following various scandals and write-downs on their exposure to foreign real estate. Investors Real Estate Trust (IRET) missed estimates by 6 cents. iStar Financial (SFI) is initiated with a Buy at BTIG Research. Corporate Office Properties (OFC) is now Neutral from Underweight at JPMorgan. Equity Residential (EQR) is raised to Buy from Hold at ISI Group. PacWest Bancorp (PACW) is upgraded to Outperform from Neutral at Macquarie. ING Groep (ING) gets downgraded to Neutral from Outperform at Macquarie. Unicredit (UNCFY) gets reduced to Hold from Buy at Société Générale.

Dow Components – American Express (AXP) down 0.30%, Bank of America (BAC) up 4.31%, JP Morgan Chase (JPM) up 1.96%, Travelers (TRV) up 2.27%.

The Financial Select Sector SPDR (XLF) was trading at $15.655 at 3:30 PM on Tuesday, up 0.68% on the day – up 20.42% year-to-date.

Information Technology

Less than 24 hours after news broke that its infrastructure CTO had left, Zynga (ZNGA) yesterday announced that chief marketing and revenue officer Jeff Karp has become the latest in a long line of executives to leave. Mark Zuckerberg is due to speak at a TechCrunch conference in San Francisco today in a rare public appearance since Facebook's (FB) bungled IPO in May, following which shares have plummeted and communication has been scarce. Ancestry.com (ACOM) is still talking with three P-E firms about a buyout, but bidders continue to balk at the company's demand for an acquisition price above $35 a share ($1.5B). Hanwha SolarOne (HSOL) missed estimates by 19 cents and revenue by $5M. Palo Alto Networks (PANW) beat estimates by 3 cents and revenue by $10M. The company guides on its FQ4 call for FQ1 revenue of $80M-$84M and EPS of $0.03; the former is mostly above an $80.1M consensus, but the latter is only in-line. Majesco Entertainment (COOL) missed estimates by 5 cents and revenue by $4M. The company now expects FQ4 results to be "in the lower end" of a revenue guidance range of $130M-$140M and EPS range of $0.20-$0.30. Street estimates stand at $139M and $0.27. Intuit (INTU) is begun with an Equal Weight at Evercore. Yelp Inc. (YELP) is picked up with a Neutral at Piper Jaffray. Synacor (SYNC) is now Neutral from Sell at Citigroup. Majesco Entertainment (COOL) is cut to Hold from Buy at Needham. TIBCO Software (TIBX) is taken to Hold from Buy at ThinkEquity.

Dow Components – Cisco Systems (CSCO) down 0.16%, Hewlett-Packard (HPQ) up 2.67%, IBM (IBM) up 0.98%, Intel Corp (INTC) up 0.82%, Microsoft (MSFT) up 0.42%.

The Technology Select Sector SPDR (XLK) was trading at $30.81 at 3:30 PM on Tuesday, up 0.16% on the day – up 21.06% year-to-date.

Telecommunication Services

Dow Components – AT&T (T) up 0.75%, Verizon (VZ) up 0.49%. The NASDAQ Telecommunications Index (IXTC) was trading at $197.16 at 3:30 PM on Tuesday, up 0.11% on the day – up 0.12% year-to-date.

Utilities

The Big Names – Dominion Resources (D) down 0.54%, Edison International (EIX) up 0.14%, First Energy (FE) down 0.29%, PG&E Corp (PCG) down 0.08%, Southern Company (SO) down 0.38%. The Utilities Select Sector SPDR (XLU) was trading at $36.50 at 3:30 PM on Tuesday, down 0.22% on the day – up 1.45% year-to-date.

STOCKS: CVX, XOM, AA, DD, BA, CAT, GE, MMM, UTX, DIS, HD, MCD, KFT, KO, PG, WMT, JNJ, MRK, PFE, AXP, BAC, JPM, TRV, CSCO, HPQ, IBM, INTC, MSFT, T, VZ, D, EIX, FE, PCG, SO, BP, PXP, RIG, EOG, NBL, DK, VQ, REPYY, SDRL, PXP, MT, BMS, PDH, HCLP, SEE, CRS, MUSA, MLM, CLF, IP, PKG, RKT, JAG, TTN, DOV, GOL, CFX, GOL, HUB-B, PHG, TYC, AONE, JW.A, AEO, KFT, GMCR, SSH, AMGN, ARIA, SNY, SNTS, SNN, AZN, BIIB, CELG, GERN, ZLCS, AIG, RBS, TWO, FULT, MCO, RF, AINV, WFC, FITB, BK, STT, APKT, FNSR, AAPL, DELL, AMD, DOX, ERIC, IFNNY, STX, GTAT, S, NEE, NRG, EXC

 

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Companies

Symbol Name Price Change % Volume
MMM 3M Company 199.54 0.00 0.00 60 Trade
SDRL Seadrill Limited (Bermuda) 0.53 0.00 0.00 65,406 Trade
PG Procter & Gamble Company (The) 86.86 0.00 0.00 0 Trade
GE General Electric Co 27.49 0.00 0.00 5,961 Trade
CVX Chevron Corporation 105.11 0.00 0.00 5,801 Trade
SO Southern Company (The) 50.50 0.00 0.00 0 Trade
PCG Pacific Gas & Electric Co. 67.29 0.00 0.00 0 Trade
RIG Transocean Ltd (Switzerland) 9.65 0.00 0.00 126,465 Trade
DOX Amdocs Limited 64.24 0.00 0.00 0 Trade
PKG Packaging Corporation of America 101.97 0.00 0.00 0 Trade
IP International Paper Company 52.16 0.00 0.00 0 Trade
JNJ Johnson & Johnson 127.53 0.00 0.00 234 Trade
WMT Wal-Mart Stores Inc. 78.31 0.00 0.00 103 Trade
AA Alcoa Inc. 33.09 0.00 0.00 455 Trade
INTC Intel Corporation 36.26 0.00 0.00 402 Trade
IBM International Business Machines Corp 153.20 0.00 0.00 337 Trade
D Dominion Resources Inc. 80.97 0.00 0.00 0 Trade
TRV The Travelers Companies Inc. 123.72 0.00 0.00 0 Trade
ARIA ARIAD Pharmaceuticals Inc. n/a n/a n/a 0 Trade
AAPL Apple Inc. 153.87 0.00 0.00 60,346 Trade
SNRW New Senior Investment Group Inc n/a n/a n/a 0 Trade
S Sprint Corporation 8.33 0.00 0.00 1,538 Trade
FITB Fifth Third Bancorp 24.47 0.00 0.00 0 Trade
CRS Carpenter Technology Corporation 36.61 0.00 0.00 0 Trade
EIX Edison International 79.95 0.00 0.00 0 Trade
NRG NRG Energy Inc. 16.45 0.00 0.00 656 Trade
JPM JP Morgan Chase 85.35 0.00 0.00 12,532 Trade
STX Seagate Technology 43.11 0.00 0.00 37 Trade
AXP American Express Company 77.44 0.00 0.00 0 Trade
FNSR Finisar Corporation 24.79 0.00 0.00 0 Trade
UTX United Technologies Corporation 122.25 0.00 0.00 0 Trade
AMD Advanced Micro Devices Inc. 10.98 0.00 0.00 132,108 Trade
MLM Martin Marietta Materials Inc. 229.53 0.00 0.00 0 Trade
CSCO Cisco Systems Inc. 31.44 0.00 0.00 3,391 Trade
ERIC Ericsson 7.05 0.00 0.00 1,386,505 Trade
DIS Walt Disney Company (The) 107.27 0.00 0.00 497 Trade
VZ Verizon Communications Inc. 45.31 0.00 0.00 150 Trade
PHG Koninklijke Philips N.V. NY Registry Shares 35.28 0.00 0.00 520 Trade
GMCR Keurig Green Mountain Inc n/a n/a n/a 0 Trade
HCLP Hi-Crush Partners LP representing limited partner 13.40 0.00 0.00 0 Trade
GERN Geron Corporation 3.01 0.00 0.00 0 Trade
BAC Bank of America Corporation 23.25 0.00 0.00 230,694 Trade
DK Delek US Holdings Inc. 25.33 0.00 0.00 0 Trade
RBS Royal Bank of Scotland Group Plc New (The) ADS 6.88 0.00 0.00 118,262 Trade
MCD McDonald\'s Corporation 149.78 0.00 0.00 711 Trade
BMS Bemis Company Inc. 44.72 0.00 0.00 0 Trade
BK Bank of New York Mellon Corporation (The) 47.38 0.00 0.00 0 Trade
SNN Smith & Nephew SNATS Inc. 35.02 0.00 0.00 0 Trade
RF Regions Financial Corporation 14.28 0.00 0.00 1,700 Trade
DD E.I. du Pont de Nemours and Co. 77.39 0.00 0.00 1 Trade
EOG EOG Resources Inc. 91.02 0.00 0.00 0 Trade
AMGN Amgen Inc. 155.43 0.00 0.00 50 Trade
NEE NextEra Energy Inc. 140.70 0.00 0.00 0 Trade
AINV Apollo Investment Corporation 6.38 0.00 0.00 0 Trade
GOL Gol Linhas Aereas Inteligentes S.A. Sponsored ADR 12.05 0.00 0.00 0 Trade
TYC Tyco International plc (Ireland) n/a n/a n/a 0
HD Home Depot Inc. (The) 156.46 0.00 0.00 1,552 Trade
XOM Exxon Mobil Corporation 81.75 0.00 0.00 5,841 Trade
TWO Two Harbors Investment Corp 10.09 0.00 0.00 0 Trade
PFE Pfizer Inc. 32.16 0.00 0.00 721 Trade
BIIB Biogen Inc. 252.97 0.00 0.00 54 Trade
WFC Wells Fargo & Company 52.78 0.00 0.00 208 Trade
AIG American International Group Inc. New 63.12 0.00 0.00 125 Trade
MT ArcelorMittal 21.92 0.00 0.00 89,447 Trade
HPQ HP Inc. 18.37 0.00 0.00 14,675 Trade
AZN Astrazeneca PLC 34.34 0.00 0.00 13,100 Trade
BA Boeing Company (The) 187.07 0.00 0.00 353 Trade
CELG Celgene Corporation 116.74 0.00 0.00 2 Trade
MRK Merck & Company Inc. (new) 65.04 0.00 0.00 0 Trade
NBL Noble Energy Inc. 29.73 0.00 0.00 0 Trade
MUSA Murphy USA Inc. 68.56 0.00 0.00 0 Trade
SEE Sealed Air Corporation 44.22 0.00 0.00 0 Trade
SNY Sanofi American Depositary Shares (Each repstg one 49.03 0.00 0.00 84,306 Trade
CFX Colfax Corporation 40.09 0.00 0.00 0 Trade
MCO Moody\'s Corporation 116.54 0.00 0.00 0 Trade
CLF Cliffs Natural Resources Inc 6.24 0.00 0.00 2,109 Trade
BP BP p.l.c. 36.40 0.00 0.00 84,643 Trade
FE FirstEnergy Corporation 28.86 0.00 0.00 15 Trade
KO Coca-Cola Company (The) 45.41 0.00 0.00 2,689 Trade
EXC Exelon Corporation 36.03 0.00 0.00 140 Trade
T AT&T Inc. 38.23 0.00 0.00 1,329 Trade
CAT Caterpillar Inc. 105.02 0.00 0.00 27 Trade
AEO American Eagle Outfitters Inc. 11.42 0.00 0.00 2 Trade
DOV Dover Corporation 81.85 0.00 0.00 0 Trade
FULT Fulton Financial Corporation 17.75 0.00 0.00 2 Trade
SSH Sunshine Heart Inc 390.80 0.00 0.00 0
MSFT Microsoft Corporation 69.62 0.00 0.00 42,630 Trade

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