Equities Sector Coverage: Stocks Close Out Strong First Quarter

Sector Recap |

will markets keep rising, is economy recovering, will dow keep risingPersonal Income rose by just 0.2% in February with Spending up 0.8%. This brings the Savings Rate down to 3.7%, the lowest since August 2009. The year over year PCE Price Index was up 2.3%, above the Federal Reserve target for inflation. Chicago PMI came in slightly below expectations at 62.2 in March with an elevated prices paid index at 70.1. The Employment Component fell to 56.3 from 64.2 in February. The final reading of the Reuters/University of Michigan's consumer sentiment index hit 76.2 for March from a preliminary reading of 74.3. The Dow Jones Industrial Average traded up to 13,224.49 on Friday afternoon still shy of its 52-week high set at 13,289.08 on March 16th. The NASDAQ’s traded up to 3111.56 then fell to 3079.05 before consolidating. The NASDAQ stayed below its 52-week high at 3134.17 set on Tuesday.

Asian stocks declined again on Friday. The Nikkei 225 ended their session at 10,084 – down 0.31% on the day. The Hang Seng ended their session at 20,556 – down 0.26% on the day. European stocks rebounded on Friday. The FTSE 100 ended their session at 5,768 – up 0.46% on the day. The DAX ended their session at 6,947 – up 1.04% on the day. The CAC 40 ended their session at 3,424 – up 1.26% on the day. The yield on the 10-Year US Treasury declined from 2.177 percent to 2.139 then rose to 2.237 closing above its 200-day simple moving average at 2.183.

Gold rebounded from $1659.0 the Troy ounce to $1670.0 staying below its 200-day simple moving average at $1685.5. Crude oil rebounded from $102.95 per barrel to $103.69, fell to $102.82, then rose to $104.15 versus its 50-day simple moving average at $103.55. The euro versus the dollar rebounded from 1.3297 to 1.3375 staying above the 50-day simple moving average at 1.3206.

Energy

PetroChina (PTR), already the world's largest publicly-traded crude producer, plans to "buy assets on a large scale" to expand output. Lufkin Industries (LUFK) is launched with a Buy recommendation and $96 target at Dahlman Rose.

Energy Select Sector SPDR (XLE) was trading at $71.75 at 4:00 PM on Friday, up 0.81% on the day – up 3.79% year-to-date. The March 2012 change was -4.18%. The 2011 change was -1.29%.

Heavily Traded: (WMB) +1%, (VLO) -3.7%, (HAL) +1.7%.

Materials

BHP's (BHP) iron-ore chief, Ian Ashby, will unexpectedly step down on July 1. Pan American Silver (PAAS) is begun with a Buy and $31 target price at Deutsche Bank, which has a Hold on Hecla Mining (HL). AK Steel (AKS) is a new Neutral at Nomura, which begins Buys on rivals US Steel (X), and Steel Dynamics (STLD).

The Materials Select Sector SPDR (XLB) was trading at $36.97 at 4:00 PM on Friday, up 0.35% on the day – up 10.36% year-to-date. The March 2012 change was +0.00. The 2011 change was -12.78%.

Heavily Traded: (AA) +1.1%, (FCX) +0.6%.

Industrials

CPI Aerostructures (CVU) is upgraded to Buy from Hold at Capstone. Raytheon (RTN) is reduced to Sector Perform from Outperform at RBC Capital.

The Industrial Select Sector SPDR (XLI) was trading at $37.415 at 4:00 PM on Friday, up 0.44% on the day – up 10.86% year-to-date. The March 2012 change was +0.50%. The 2011 change was -3.21%.

Big Movers: (AWI) -14.5%.
Heavily Traded: (GE) +0.8%, (JBLU) -0.9%.

Consumer Discretionary

Lululemon Athletica (LULU) is begun with a Buy at UBS. Buffalo Wild Wings (BWLD) is a new Equal Weight at Morgan Stanley, which begins BJ Restaurants (BJRI) at Overweight. Walt Disney (DIS) is upgraded to Buy from Neutral at Lazard. Discovery Communications (DISCA) is lifted to Buy from Neutral at Lazard. Gap Inc (GPS) is boosted to Buy from Neutral at Janney Scott with a $33 target. Wyndham Worldwide (WYN) is upgraded to Buy from Neutral at Goldman Sachs.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $45.09 at 4:00 PM on Friday, up 0.45% on the day – up 15.56% year-to-date. The March 2012 change was +4.40%. The 2011 change was +4.30%.

Big Movers: (FINL) -14.5%, (LIZ) +13%.

Consumer Staples

Beam Inc (BEAM) is initiated with a Buy at Suntrust. United Natural Foods (UNFI) is started with a Sell and $33 target at Cantor Fitzgerald.



The Consumer Staples Select Sector SPDR (XLP) was trading at $34.08 at 4:00 PM on Friday, up 0.61% on the day – up 4.89% year-to-date. The March 2012 change was +2.56%. The 2011 change was +10.85%.

Big Movers: (FEED) -12%.
Heavily Traded: (RAD) -0.6%, (KO) down slightly, (MO) +1.1%, (SVU) -2.1%.

Health Care

Amerigroup (AGP), Molina Healthcare (MOH), and Centene (CNC) are all begun with Buys at Jefferies. Incyte (INCY) is initiated with a Buy at ThinkEquity. Vivus Inc (VVUS) is upgraded to Buy from Hold at Brean Murray. Accretive Health (AH) is now Neutral from Outperform with a new lower target of $21 at Robert W. Baird. Kindred Healthcare (KND) is cut to Market Perform from Outperform with Wells Fargo. Select Medical (SEM) is moved to Market Perform from Outperform with Wells.

The Health Care Select Sector SPDR (XLV) was trading at $37.61 at 4:00 PM on Friday, up 0.75% on the day – up 8.42% year-to-date. The March 2012 change was +3.95%. The 2011 change was +10.32%.

Big Movers: (SNSS) +19.5%, (STEM) +11%, (OREX) -9.5%.

Financials

Morgan Stanley (MS) is making preparations for a major downgrade from Moody's, which is due to decide in May whether to cut ratings for 17 global institutions. BATS (BATS) is thinking about suspending its efforts to recruit corporate listings after last Friday's trading glitch and IPO fiasco, The Wall Street Journal reports. The move would be a major defeat for the company, which has viewed such listings as critical in its efforts to compete with larger rivals NYSE Euronext (NYX) and Nasdaq (NDAQ). Peoples Bancorp (PEBO) is a new Outperform and $21 price objective at Keefe Bruyette. Kilroy Realty (KRC) is resumed with a Sell at Cantor Fitzgerald amid an uncompelling current valuation. By contrast, the broker begins Buy rated coverage on Boston Properties (BXP), Brandywine Realty (BDN), and SL Green Realty (SLG). U.S. Bancorp (USB) is downgraded to Market Perform from Outperform at BMO Capital.

The Financial Select Sector SPDR (XLF) was trading at $15.795 at 4:00 PM on Friday, up 0.54% on the day – up 21.50% year-to-date (the strongest performing sector). The March 2012 change was +7.01%. The 2011 change was -18.50%; the weakest performing sector for the year.

Big Movers: (XIN) +9.25%.

Information Technology

Research In Motion (RIMM) would consider selling itself if a strategic review found that this was its best option, CEO Thorsten Heins said yesterday after the BlackBerry maker once again missed earnings forecasts. RIM's FQ4 adjusted EPS almost halved on year to $0.80 as revenue slumped 25% to $4.19, while the company said it would discontinue "providing specific quantitative guidance." Apple (AAPL) and Foxconn have forged an agreement in which the latter will hire tens of thousands of workers, halt illegal overtime, improve safety and upgrade workers' housing. Websense (WBSN) is initiated with a Market Perform at JMP Securities. LinkedIn (LNKD) is lifted to Positive from Neutral at Susquehanna. InvenSense (INVN) is cut to Perform from Outperform with a $15 objective at Oppenheimer.

The Technology Select Sector SPDR (XLK) was trading at $30.15 at 4:00 PM on Friday, down 0.33% on the day – up 18.47% year-to-date. The March 2012 change was +4.16%. The 2011 change was +1.03%.

Big Movers: (FFN) -17%, (SIHI) -12.5%, (INVN) -10%.

Telecommunication Services

Vodafone (VOD) is urgently reviewing its options in India and overseas as the country moves toward a law that would retroactively apply a tax of over $2B on Vodafone's 2007 purchase of Hutchison Whampoa's Indian telecom venture. France Telecom (FTE) is taken to Sell from Neutral at Citigroup.

The NASDAQ Telecommunications Index (IXTC) was trading at $221.24 at 4:00 PM on Friday, up 0.43% on the day – up 12.34% year-to-date. The March 2012 change was +3.64%. The 2011 change was -12.62%.

Big Movers: (TWER) +14%, (TSTRQ) -9%.
Heavily Traded: (S) -2.2%, (T) up slightly, (FTR) +1.1%, (CLWR) -2.9%, (VZ) +0.2%.

Utilities

The Utilities Select Sector SPDR (XLU) was trading at $35.045 at 3:30 PM on Friday, up 0.55% on the day – down 2.60% year-to-date (the weakest performing sector / the only negative sector). The March 2012 change was +0.44%. The 2011 change was +14.81%; the strongest performing sector for the year.

Heavily Traded: (DUK) +0.2%, (GEN) flat, (CNP) +1.5%, (EXC) -0.2%, (AES) +0.2%, (SO) flat, (AEP) +0.5%, (PPL) +0.6%.

STOCKS: PTR, LUFK, WMB, VLO, HAL, BHP, PAAS, HL, AKS, X, STLD, AA, FCX, CVU, RTN, AWI, GE, JBLU, LULU, BWLD, BJRI, DIS, DISCA, GPS, WYN, FINL, LIZ, BEAM, UNFI, FEED, RAD, KO, MO, SVU, AGP, CNC, INCY, VVUS, AH, KND, SEM, SNSS, STEM, OREX, MS, BATS, NYX, NDAQ, PEBO, KRC, BXP, BDN, SLG, USB, XIN, RIMM, AAPL, WBSN, LNKD, INVN, FFN, SIHI, VOD, FTE, TWER, TSTRQ, S, T, FTR, CLWR, VZ, DUK, GEN, CNP, EXC, AES, SO, AEP, PPL

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
CVU CPI Aerostructures Inc. 7.85 0.15 1.95 30,686
CNC Centene Corporation 74.57 -0.68 -0.90 920,450 Trade
GEN Genesis Healthcare Inc. 1.86 -0.06 -3.13 91,356 Trade
FTR Frontier Communications Corporation 1.33 -0.03 -2.21 15,484,487 Trade
GE General Electric Co 27.45 -0.04 -0.15 30,624,045 Trade
SO Southern Company (The) 50.45 -0.05 -0.10 3,265,939 Trade
AKS AK Steel Holding Corporation 5.80 -0.14 -2.36 9,098,231 Trade
FINL The Finish Line Inc. 14.14 0.07 0.50 849,875 Trade
WYN Wyndham Worldwide Corp Common Stock 99.63 0.53 0.53 1,210,014 Trade
RTN Raytheon Company 163.30 0.19 0.12 1,468,401 Trade
AA Alcoa Inc. 33.27 0.18 0.54 2,410,586 Trade
VLO Valero Energy Corporation 62.45 -0.74 -1.17 3,718,744 Trade
CNP CenterPoint Energy Inc (Holding Co) 28.33 0.15 0.53 2,109,843 Trade
KND Kindred Healthcare Inc. 9.90 -0.30 -2.94 551,352 Trade
RAD Rite Aid Corporation 3.67 -0.03 -0.81 6,819,769 Trade
SIS:CA Savaria Corporation 17.29 0.45 2.67 115,655
MO Altria Group Inc. 74.41 0.27 0.36 5,680,989 Trade
AAPL Apple Inc. 153.61 -0.26 -0.17 21,927,637 Trade
S Sprint Corporation 8.40 0.07 0.84 6,651,970 Trade
PPL PPL Corp 39.86 -0.04 -0.10 2,144,829 Trade
PEBO Peoples Bancorp Inc. 31.05 0.19 0.62 22,586 Trade
INVN InvenSense Inc. n/a n/a n/a 0 Trade
MS Morgan Stanley 42.84 0.21 0.49 5,346,476 Trade
SNSS Sunesis Pharmaceuticals Inc. 3.09 0.02 0.65 30,878 Trade
BDN Brandywine Realty Trust 17.44 -0.07 -0.40 471,840 Trade
VOD Vodafone Group Plc 29.98 0.07 0.23 7,251,414 Trade
BWLD Buffalo Wild Wings Inc. 151.00 -2.25 -1.47 398,791 Trade
AWI Armstrong World Industries Inc 42.00 0.65 1.57 531,710 Trade
INCY Incyte Corporation 134.38 -4.03 -2.91 2,366,454 Trade
AES The AES Corporation 11.79 0.01 0.08 2,565,130 Trade
DIS Walt Disney Company (The) 108.41 1.14 1.06 6,236,779 Trade
SLG SL Green Realty Corporation 101.84 -0.82 -0.80 455,918 Trade
JBLU JetBlue Airways Corporation 22.95 0.14 0.61 4,881,281 Trade
KRC Kilroy Realty Corporation 72.97 -0.78 -1.06 268,660 Trade
WMB Williams Companies Inc. (The) 29.69 -0.17 -0.57 5,106,338 Trade
XIN Xinyuan Real Estate Co Ltd American Depositary Sha 4.84 -0.12 -2.42 191,311 Trade
PTR PetroChina Company Limited 67.78 -0.35 -0.51 101,716 Trade
VZ Verizon Communications Inc. 45.32 0.01 0.02 5,999,937 Trade
SEM Select Medical Holdings Corporation 13.80 -0.10 -0.72 333,815 Trade
UNFI United Natural Foods Inc. 39.92 -0.12 -0.30 556,790 Trade
OREX Orexigen Therapeutics Inc. 2.97 0.03 1.02 41,442 Trade
SVU SuperValu Inc. 3.85 -0.02 -0.52 1,393,002 Trade
BHP BHP Billiton Limited 35.84 -0.37 -1.02 1,350,535 Trade
USB U.S. Bancorp 51.44 -0.33 -0.64 6,721,847 Trade
LNKD LinkedIn Corporation Class A n/a n/a n/a 0 Trade
FCX Freeport-McMoRan Inc. 11.67 -0.03 -0.26 9,747,397 Trade
HL Hecla Mining Company 6.02 0.04 0.67 4,443,331 Trade
PAAS Pan American Silver Corp. 17.72 0.18 1.03 1,404,101 Trade
BJRI BJ\'s Restaurants Inc. 45.50 -0.55 -1.19 221,064 Trade
BXP Boston Properties Inc. 121.35 -0.65 -0.53 400,926 Trade
GPS Gap Inc. (The) 22.42 0.40 1.82 6,113,673 Trade
VVUS VIVUS Inc. 1.13 0.01 0.89 642,219 Trade
LIZ Liz Claiborne Inc. n/a n/a n/a 0 Trade
LULU lululemon athletica inc. 48.23 -0.46 -0.94 3,020,873 Trade
X United States Steel Corp. 19.74 -0.51 -2.52 15,744,254 Trade
NDAQ Nasdaq Inc. 67.58 -0.61 -0.89 561,929 Trade
STEM StemCells Inc. n/a n/a n/a n/a
KO Coca-Cola Company (The) 45.39 -0.02 -0.04 11,341,383 Trade
EXC Exelon Corporation 35.82 -0.21 -0.58 5,699,892 Trade
T AT&T Inc. 38.12 -0.11 -0.29 13,725,914 Trade
HAL Halliburton Company 45.76 0.35 0.77 9,938,793 Trade
DUK Duke Energy Corporation (Holding Company) 85.07 -0.07 -0.08 2,023,992 Trade
TWER Towerstream Corporation 0.18 0.01 5.42 251,688
AEP American Electric Power Company 70.87 0.07 0.10 3,464,774 Trade
STLD Steel Dynamics Inc. 33.71 -0.73 -2.12 3,611,189 Trade

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