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.


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.


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.


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.


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.


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.



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


Symbol Name Price Change % Volume
AA Alcoa Inc. 26.88 0.19 0.71 6,223,217
AAPL Apple Inc. 116.60 -0.46 -0.39 23,192,665
AEO American Eagle Outfitters Inc. 17.66 0.16 0.91 2,624,373
AIG American International Group Inc. New 60.00 -0.07 -0.12 4,218,319
AINV Apollo Investment Corporation 6.00 0.05 0.84 770,392
AMD Advanced Micro Devices Inc. 6.52 -0.44 -6.32 64,243,549
AMGN Amgen Inc. 158.51 -2.99 -1.85 3,540,978
ARIA ARIAD Pharmaceuticals Inc. 10.38 -0.40 -3.71 11,157,740
AXP American Express Company 67.36 0.58 0.87 8,561,225
AZN Astrazeneca PLC 30.72 -0.28 -0.90 2,681,479
BA Boeing Company (The) 135.63 -0.21 -0.15 2,205,772
BAC Bank of America Corporation 16.67 0.11 0.66 77,954,926
BIIB Biogen Inc. 290.65 -9.01 -3.01 1,567,526
BK Bank of New York Mellon Corporation (The) 43.05 0.80 1.89 12,004,288
BMS Bemis Company Inc. 50.00 -0.46 -0.91 545,253
BP BP p.l.c. 36.25 0.20 0.55 4,214,936
CAT Caterpillar Inc. 86.33 -0.30 -0.35 3,592,524
CELG Celgene Corporation 98.91 -1.11 -1.11 4,660,808
CFX Colfax Corporation 30.02 0.72 2.46 1,048,060
CLF Cliffs Natural Resources Inc 6.01 -0.08 -1.31 7,651,851
CRS Carpenter Technology Corporation 39.07 0.14 0.36 171,555
CSCO Cisco Systems Inc. 30.15 -0.01 -0.03 15,140,452
CVX Chevron Corporation 101.30 -0.57 -0.56 5,622,393
D Dominion Resources Inc. 72.84 -0.27 -0.37 1,510,791
DD E.I. du Pont de Nemours and Co. 69.70 0.24 0.35 1,824,762
DIS Walt Disney Company (The) 93.03 1.00 1.09 13,814,538
DK Delek US Holdings Inc. 17.44 0.48 2.83 562,456
DOV Dover Corporation 68.64 0.44 0.65 1,371,552
DOX Amdocs Limited 58.99 -0.52 -0.87 864,724
EIX Edison International 70.90 -0.85 -1.18 1,625,069
EOG EOG Resources Inc. 93.88 -1.03 -1.09 2,729,648
ERIC Ericsson 5.10 -0.27 -5.03 20,443,516
EXC Exelon Corporation 32.50 -0.34 -1.04 3,905,431
FE FirstEnergy Corporation 33.19 0.34 1.04 4,060,791
FITB Fifth Third Bancorp 21.21 0.19 0.90 6,436,276
FNSR Finisar Corporation 29.16 -0.52 -1.75 949,045
FULT Fulton Financial Corporation 14.80 0.00 0.00 948,098
GE General Electric Co 28.98 -0.09 -0.31 64,153,187
GERN Geron Corporation 2.12 0.03 1.44 1,189,281
GMCR Keurig Green Mountain Inc n/a n/a n/a 0
GOL Gol Linhas Aereas Inteligentes S.A. Sponsored ADR 25.65 0.74 2.97 257,970
HCLP Hi-Crush Partners LP representing limited partner 17.80 0.35 2.01 321,833
HD Home Depot Inc. (The) 126.60 0.35 0.28 3,234,121
HPQ HP Inc. 13.80 -0.30 -2.13 14,610,055
IBM International Business Machines Corp 149.63 -1.89 -1.25 4,414,206
INTC Intel Corporation 35.15 -0.28 -0.79 20,813,248
IP International Paper Company 47.00 -0.18 -0.38 2,206,108
JNJ Johnson & Johnson 113.44 -1.43 -1.24 8,422,032
JPM JP Morgan Chase 68.49 0.23 0.34 12,175,674
KO Coca-Cola Company (The) 42.13 0.20 0.48 14,401,515
MCD McDonald\'s Corporation 113.93 3.36 3.04 10,108,048
MCO Moody\'s Corporation 102.24 -5.85 -5.41 3,985,071
MLM Martin Marietta Materials Inc. 179.73 1.43 0.80 532,805
MMM 3M Company 169.50 -0.36 -0.21 2,013,555
MRK Merck & Company Inc. (new) 61.20 -0.72 -1.16 7,406,681
MSFT Microsoft Corporation 59.66 2.41 4.21 80,032,206
MT ArcelorMittal 6.68 0.15 2.30 23,140,217
MUSA Murphy USA Inc. 68.61 -0.26 -0.38 199,835
NBL Noble Energy Inc. 35.74 -0.18 -0.50 2,453,269
NEE NextEra Energy Inc. 123.71 -0.42 -0.34 1,126,152
NRG NRG Energy Inc. 11.52 -0.12 -1.03 6,071,971
PCG Pacific Gas & Electric Co. 60.31 -0.53 -0.87 1,312,897
PFE Pfizer Inc. 32.18 -0.36 -1.11 18,834,961
PG Procter & Gamble Company (The) 84.33 -0.60 -0.71 13,974,139
PHG Koninklijke Philips N.V. NY Registry Shares 28.43 -0.23 -0.80 1,578,011
PKG Packaging Corporation of America 81.54 0.41 0.51 903,063
RBS Royal Bank of Scotland Group Plc New (The) ADS 4.68 0.08 1.74 1,288,835
RF Regions Financial Corporation 10.64 0.03 0.28 13,930,481
RIG Transocean Ltd (Switzerland) 10.50 -0.09 -0.85 8,151,599
S Sprint Corporation 6.55 -0.17 -2.53 23,888,251
SDRL Seadrill Limited (Bermuda) 2.31 -0.04 -1.70 5,310,938
SEE Sealed Air Corporation 43.34 -0.25 -0.57 2,772,178
SNN Smith & Nephew SNATS Inc. 30.40 -0.31 -1.01 270,705
SNRW New Senior Investment Group Inc n/a n/a n/a 0
SNY Sanofi American Depositary Shares (Each repstg one 37.75 -0.32 -0.84 2,046,302
SO Southern Company (The) 50.53 -0.19 -0.37 3,342,677
SSH Sunshine Heart Inc 0.36 -0.01 -2.17 37,076
STX Seagate Technology 34.50 -0.48 -1.37 4,484,120
T AT&T Inc. 37.49 -1.16 -3.00 82,764,994
TRV The Travelers Companies Inc. 108.35 -1.17 -1.07 3,768,289
TWO Two Harbors Investment Corp 8.39 -0.02 -0.24 1,071,116
TYC Tyco International plc (Ireland) n/a n/a n/a 0
UTX United Technologies Corporation 98.67 -0.62 -0.62 4,094,992
VZ Verizon Communications Inc. 48.20 -0.94 -1.91 24,784,972
WFC Wells Fargo & Company 45.09 0.16 0.36 21,490,816
WMT Wal-Mart Stores Inc. 68.34 -0.39 -0.57 7,844,583
XOM Exxon Mobil Corporation 86.62 -0.59 -0.68 10,736,170


Emerging Growth

Relevium Technologies Inc.

Relevium Technologies Inc is engaged in the acquisition of products, technologies and businesses relating to musculoskeletal function, specifically Pain Relief, Injury Recovery and Active Performance.

Private Markets


Airbnb is a community marketplace for people to list, discover, and book unique accommodations around the world — online or from a mobile phone. Whether an apartment for a night,…


Uber connects riders with safe, reliable, convenient transportation providers at a variety of price-points in cities around the world. Uber makes money from charging their drivers 20% of the fare…