Equities Sector Coverage: Stocks Drop on Bernanke Comments But Close Flat

Sector Recap  |

The Dow Jones Industrial Average rebounded to 13,329.44 then consolidated during Fed Chief Bernanke’s press conference dipping into the red at 13,239.65 but staying above its 50-day and 200-day simple moving average at 13,133.65 and 13,002.30. The Nasdaq traded up to 3033.93 then down to 3019.22 then up to 3035.19 after the Fed Statement then down to 3013.00 during the Fed Chief’s press conference staying above its 50-day and 200-day simple moving averages at 2999.94 and 2988.91.

Asian stocks were higher on Wednesday. The Nikkei 225 closed at 9581 – up 0.59%. The Hang Seng closed at 22,503 – up 0.80%. European exchanges were higher on Tuesday. The FTSE 100 ended the day at 5,946 – up 0.35%. The DAX ended the day at 7,615 – up 0.33%. The CAC 40 ended the day at 3,647 – up 0.01%. The yield on the 10-Year US Treasury traded between 1.646% and 1.673% before the FOMC Statement then rose to 1.704% on the announcement of QE4, staying versus the 50-day and 200-day simple moving averages at 1.678% and 1.747%.

Comex gold rebounded from $1708.5 the Troy ounce to $1725.0 staying between the 200-day simple moving average at $1663.4 and the 50-day simple moving average at $1728.3. Nymex crude oil rebounded from $85.68 per barrel to $87.68 staying below the 50-day and 200-day simple moving averages at $87.86 and $93.02. The euro versus the dollar traded up from 1.2998 to 1.3095 staying above its 200-day simple moving average at 1.2782 and the 50-day at 1.2921.

Energy

As expected, OPEC has left its oil output ceiling at 30M BPD at its meeting in Vienna today, although it's unclear whether the cartel will do anything to address the fact that it's producing well above that figure. Chesapeake Energy (CHK) has agreed to sell a substantial majority of its midstream assets to Access Midstream Partners (ACMP) for $2.16B. Meanwhile, Williams Cos. (WMB) will acquire a 50% interest in Access GP and 25% of limited partner units of Access Midstream for $2.4B. Crédit Agricole cuts National Oilwell Varco (NOV) and Patterson-UTI Energy (PTEN) to Outperform from Buy. Big Movers – TOP Ships (TOPS) is up about 13%, while Cobalt International Energy (CIE) is down about 7%, both on over 3x average volume. Dow components – Chevron (CVX) is up about 0.7%. Exxon Mobil (XOM) is up about 1%. Energy Select Sector SPDR (XLE) was trading at $72.14 at 3:30 PM on Wednesday, up 0.33% on the day – up 4.35% year-to-date.

Materials

Molycorp (MCP) said that Mark Smith has left as CEO but didn't provide an explanation, although the WSJ reported that Smith was fired. Molycorp named Vice Chairman Constantine Karayannopoulos as Smith's interim replacement. Agrium (AGU) and Intrepid Potash (IPI) are new Neutrals at Goldman Sachs, which starts CF Industries (CF) at a Sell and picks up Mosaic (MOS) and Potash (POT) with Buys. Anglo American (AAUKY) received an Equal Weight-from-Underweight boost at Barclays. Big Mover – Greif Inc. (GEF) is up about 7.5% on over 3x average volume. Dow Components – Alcoa (AA) is down slightly. DuPont (DD) is up about 2%. The Materials Select Sector SPDR (XLB) was trading at $36.46 at 3:30 PM on Wednesday, down 0.30% on the day – up 8.84% year-to-date.

Industrials

Joy Global (JOY) beat estimates by 22 cents on revenue of $1.6B. The outlook for the company's mining equipment remains weak for now… The company expects FY2013 EPS at $5.90-$6.50 on revenue of $4.9B-$5.2B. ABM Industries (ABM) is upgraded to Buy from Hold at Keybanc. Towers Watson (TW) is taken to Outperform from Perform at Robert W. Baird. FedEx (FDX) is reduced to Outperform from Strong Buy at Raymond James. Knight Transportation (KNX) is now Neutral from Buy at Bank of America-Merrill Lynch. Big Mover – Swisher Hygiene (SWSH) is up about 8.5% on over 2x average volume. Dow components – Boeing Co (BA) is down slightly. Caterpillar (CAT) is up about 1.4%. General Electric (GE) is up about 1.7%. 3M Company (MMM) is down about 0.5%. United Technologies (UTX) is relatively unchanged. The Industrial Select Sector SPDR (XLI) was trading at $37.83 at 3:30 PM on Wednesday, up 0.19% on the day – up 12.09% year-to-date.

Consumer Discretionary

The WSJ has continued its focus on executive trading at Big Lots (BIG), finding that ten senior managers sold a total of over $23M in stock in March. The sales were made just before the firm reported slowing Q1 revenues, which sent shares plunging 24% in one day. Nike (NKE) is a new Neutral at JPMorgan, which has an Underweight on Under Armour (UA). Deckers Outdoor (DECK) is assigned a Buy at Janney Montgomery Scott. Mattress Firm Holding (MFRM) is initiated with a Buy at Citigroup. Expedia (EXPE) is a new Neutral at Janney, along with MakeMyTrip (MMYT) and priceline.com (PCLN). Orbitz (OWW) is initiated with a Buy. Coinstar (CSTR) is upgraded to Outperform from Market Perform at Northland. Royal Caribbean (RCL) is reduced to Neutral from Buy at Longbow. Big Mover – Eastman Kodak (EKDKQ) is down about 11%. Dow Components – Disney (DIS) is up about 0.9%. Home Depot (HD) is up about 0.25%. McDonalds (MCD) is relatively unchanged. The Consumer Discretionary Select Sector SPDR (XLY) was trading at $47.41 at 3:30 PM on Wednesday, up 0.23% on the day – up 21.50% year-to-date.

Consumer Staples

Costco's (COST) FQ1 net profit jumped 30% to $416M as EPS of $0.95 (beating consensus by 2 cents), but a revenue increase of 9.5% to $23.2B missed expectations. Costco's performance was boosted by a 14.3% increase in fee revenue after it raised some membership fees last year. Avon (AVP) intends to cut about 1,500 jobs worldwide and to exit South Korea and Vietnam as part of its program to save $400M a year by the end of 2015, which it announced in November. Mondelez International (MDLZ) is moved to Hold from Buy at Argus. Big Mover – Lifeadvantage (LFVN) is down about 11.5%. Dow components – Coca Cola (KO) is down about 0.25%. Procter & Gamble (PG) is up about 0.4%. Wal-Mart (WMT) is down about 2.6%. The Consumer Staples Select Sector SPDR (XLP) was trading at $36.13 at 3:30 PM on Wednesday, down 0.08% on the day – up 11.20% year-to-date.

Health Care

HIV drug maker Gilead Sciences Inc. (GILD) said it will pay about $510 million ($2.95 / share – an 81% premium) to buy drug developer YM BioSciences Inc. (YMI). Acadia Pharmaceuticals (ACAD) announced today a private equity financing to sell 19 million shares of common stock at $4.43 per share, plus warrants to purchase 500,000 shares at $0.01. The company expects gross proceeds of $86.4M. Warburg Pincus is reportedly looking at selling Bausch & Lomb and is seeking at least $10B for the eyecare company. Warburg's banker, Goldman Sachs, has contacted Sanofi (SNY), GlaxoSmithKline (GSK) and Merck (MRK), and plans to reach out to Abbott Laboratories (ABT). Alnylam Pharmaceuticals (ALNY) is raised to Overweight from Neutral at Piper Jaffray. Novartis (NVS) is now Hold from Buy at Deutsche Bank. Teva Pharmaceutical (TEVA) is taken to Market Perform from Outperform at Leerink. Big Movers - YM Biosciences (YMI) is up about 77%. AspenBio (APPY) is up about 22%. Cardiome Pharma (CRME) is up about 20%. Acadia Pharmaceuticals (ACAD) is up about 16.5%. Peregrine Pharmaceuticals (PPHM) is up about 15%. Acura Pharmaceuticals (ACUR) is down about 13.5%. Dow Components – Johnson & Johnson (JNJ) is up slightly. Merck (MRK) is up about 0.4%. Pfizer (PFE) is relatively unchanged. United Health Group (UNH) is up about 1.5%. The Health Care Select Sector SPDR (XLV) was trading at $41.05 at 3:30 PM on Wednesday, down 0.07% on the day – up 18.33% year-to-date.

Financials

The Fed is reportedly discouraging top U.S. banks from making large acquisitions as it informally uses powers it received under the Dodd-Frank Law and attempts to limit the ability of banks to threaten the stability of the financial system should they fail. Those told not to make major purchases include Capital One Financial (COF) after its $9B acquisition of ING's (ING) U.S. online business. Carlyle (CG) is a new Neutral at Bank of America-Merrill Lynch. Prosperity Bancshares (PB) is upgraded to Outperform from Neutral at Robert W. Baird. Sterling Bancorp (STL) is upgraded to Market Perform from Underperform at BMO Capital. Boston Properties (BXP) is downgraded to Hold from Buy at Stifel Nicolaus. Stifel Financial (SF) is downgraded to Underperform from Market Perform with Wells Fargo. Big Mover – MGIC Investment (MTG) is up about 8.5% on over 2x average volume. Dow Components – American Express (AXP) is up about 1.7%. Bank of America (BAC) is up about 1%. JP Morgan Chase (JPM) is up about 1.1%. The Travelers Companies (TRV) is up about 0.25%. The Financial Select Sector SPDR (XLF) was trading at $16.145 at 3:30 PM on Wednesday, up 0.47% on the day – up 24.19% year-to-date.

Information Technology

DayStar Technologies, Inc. (DSTI) announced that former United States Secretary of Energy, former Governor of New Mexico and Nobel Prize nominee, Bill Richardson, has joined the Board of Directors. Solar stocks are soaring today following news that Chinese officials would spend at least $2.1 billion to support the struggling industry [LDK Solar Co. (LDK), JinkoSolar (JKS), Yingli Green Energy (YGE), JA Solar (JASO) and Trina Solar (TSL), Canadian Solar (CSIQ), Renesol (SOL), Suntech Power (STP)]. SolarCity (SCTY) slashed its expected IPO price to $8 from $13-$15 and delayed going public at least a day. Akamai Technologies (AKAM) is a new Neutral at Goldman Sachs. OpenTable (OPEN) is an Overweight at JPMorgan. Yelp Inc. (YELP) is an Outperform at Credit Suisse. Take-Two Interactive Software (TTWO) is now Overweight from Neutral at Piper Jaffray. 3D Systems (DDD) is now Neutral from Underweight at JPMorgan. Seagate Technology (STX) gets downgraded to Underweight from Neutral at JPMorgan. Big Movers – DayStar Technologies (DSTI) is up about 60%. JinkoSolar (JKS) is up about 20%. Yingli Green Energy (YGE) is up about 18.25%. LDK Solar (LDK) is up about 16.5%. JA Solar (JASO) is up about 16.5%. Renesola (SOL) is up about 16%. Canadian Solar (CSIQ) is up about 14.5%. Trina Solar (TSL) is up about 13.5%. Suntech Power (STP) is up about 12.25%. Dow Components – Cisco Systems (CSCO) is up about 0.25%. Hewlett-Packard (HPQ) is up about 2.3%. IBM (IBM) is down about 0.4%. Intel Corp (INTC) is up about 0.3%. Microsoft (MSFT) is down about 0.2%. The Technology Select Sector SPDR (XLK) was trading at $29.17 at 3:30 PM on Wednesday, down 0.21% the day – up 14.62% year-to-date.

Telecommunication Services

Big Mover – Neutral Tandem (IQNT) is up about 9%. Dow Components – AT&T (T) is up about 1.4%. Verizon (VZ) is up about 1.1%. The NASDAQ Telecommunications Index (IXTC) was trading at $201.10 at 3:30 PM on Wednesday, up 0.02% on the day – up 2.12% year-to-date.

Utilities

E.ON AG (EONGY) is cut to Underperform from Neutral at Credit Suisse. The Big Names – Dominion Resources (D) is up about 0.3%. Edison International (EIX) is up about 0.25%. First Energy (FE) is relatively unchanged. PG&E Corp (PCG) is up about 0.25%. Southern Company (SO) is down about 0.4%. The Utilities Select Sector SPDR (XLU) was trading at $35.545 at 3:30 PM on Wednesday, down 0.01% on the day – down 1.21% year-to-date.

STOCKS: CVX, XOM, AA, DD, BA, CAT, GE, MMM, UTX, DIS, HD, MCD, KO, PG, WMT, JNJ, MRK, PFE, UNH, AXP, BAC, JPM, TRV, CSCO, HPQ, IBM, INTC, MSFT, T, VZ, D, EIX, FE, PCG, SO, CHK, ACMP, WMB, NOV, PTEN, TOPS, CIE, MCP, AGU, IPI, CF, MOS, POT, AAUKY, GEF, JOY, ABM, TW, FDX, KNX, SWSH, BIG, NKE, UA, DECK, MFRM, EXPE, MMYT, PCLN, OWW, CSTR, RCL, EKDKQ, COST, AVP, MDLZ, LFVN, GILD, YMI, ACAD, SNY, GSK, MRK, ABT, ALNY, NVS, TEVA, APPY, CRME, PPHM, ACUR, COF, ING, CG, PB, STL, BXP, SF, MTG, DSTI, LDK, JKS, YGE, JASO, TSL, CSIQ, SOL, STP, SCTY, AKAM, OPEN, YELP, TTWO, DDD, TSX, IQNT, EONGY

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
MMM 3M Company 209.00 4.09 2.00 2,620,428 Trade
UNH UnitedHealth Group Incorporated (DE) 271.11 6.17 2.33 3,857,794 Trade
GSK GlaxoSmithKline PLC 40.34 -0.07 -0.17 3,574,702 Trade
CF CF Industries Holdings Inc. 47.09 0.48 1.03 3,283,939 Trade
DECK Deckers Outdoor Corporation 129.90 2.24 1.75 694,799 Trade
PG Procter & Gamble Company (The) 93.82 -0.01 -0.01 13,013,482 Trade
GE General Electric Company 8.02 -0.15 -1.84 176,608,926 Trade
CVX Chevron Corporation 119.06 2.11 1.80 6,706,879 Trade
ABT Abbott Laboratories 72.04 1.31 1.85 9,860,817 Trade
SO Southern Company (The) 46.89 0.31 0.67 7,551,984 Trade
MOS Mosaic Company (The) 36.67 0.53 1.47 4,224,322 Trade
PCG Pacific Gas & Electric Co. 24.40 6.66 37.54 54,698,387 Trade
ABM ABM Industries Incorporated 31.47 0.51 1.65 535,196 Trade
YELP Yelp Inc. 32.77 -0.24 -0.73 1,629,522 Trade
MMYT MakeMyTrip Limited 23.85 -0.10 -0.42 221,748 Trade
JNJ Johnson & Johnson 145.99 1.49 1.03 8,494,311 Trade
CG The Carlyle Group L.P. 17.97 -0.60 -3.23 1,273,175 Trade
IPI Intrepid Potash Inc 3.81 -0.14 -3.54 793,071 Trade
WMT Walmart Inc. 97.69 -1.85 -1.86 14,235,231 Trade
AA Alcoa Corporation 35.95 0.01 0.03 3,092,050 Trade
INTC Intel Corporation 48.83 0.72 1.50 31,670,572 Trade
IBM International Business Machines Corporation 121.57 0.13 0.11 4,076,315 Trade
LFVN Lifevantage Corporation 11.42 -0.16 -1.38 101,622 Trade
D Dominion Energy Inc. 73.61 0.16 0.22 3,683,335 Trade
NOV National Oilwell Varco Inc. 33.65 0.15 0.45 2,797,317 Trade
TRV The Travelers Companies Inc. 128.77 3.18 2.53 2,734,079 Trade
APPY Venaxis Inc. n/a n/a n/a n/a
BIG Big Lots Inc. 41.53 -0.55 -1.31 792,384 Trade
ACAD ACADIA Pharmaceuticals Inc. 18.93 0.30 1.61 1,740,949 Trade
MDLZ Mondelez International Inc. 44.27 0.33 0.75 6,467,746 Trade
EXPE Expedia Group Inc. 116.95 -2.80 -2.34 2,373,234 Trade
ALNY Alnylam Pharmaceuticals Inc. 73.16 3.79 5.46 883,246 Trade
AKAM Akamai Technologies Inc. 69.87 0.41 0.59 1,179,584 Trade
ACUR Acura Pharmaceuticals Inc. 0.23 0.03 15.00 12,037
EIX Edison International 54.45 7.26 15.38 8,828,715 Trade
GILD Gilead Sciences Inc. 69.20 -0.58 -0.83 8,059,111 Trade
AXLL Axiall Corporation n/a n/a n/a 0 Trade
UA Under Armour Inc. Class C 20.21 -0.69 -3.30 3,419,715 Trade
PCLN BKNG Calfrac Well Services Ltd. n/a n/a n/a n/a
JPM JP Morgan Chase & Co. 109.99 -0.08 -0.07 13,798,551 Trade
AXP American Express Company 109.46 -0.14 -0.13 3,486,223 Trade
UTX United Technologies Corporation 130.13 0.40 0.31 5,184,353 Trade
AVP Avon Products Inc. 2.13 -0.03 -1.39 3,740,166 Trade
TSL Trina Solar Limited Sponsored ADR (Cayman Islands) n/a n/a n/a 0 Trade
CSCO Cisco Systems Inc. 46.35 -0.42 -0.90 31,327,415 Trade
DIS The Walt Disney Company 116.19 -0.92 -0.79 7,142,193 Trade
WMB Williams Companies Inc. (The) 25.13 0.13 0.52 8,644,295 Trade
COST Costco Wholesale Corporation 231.02 1.08 0.47 2,822,396 Trade
VZ Verizon Communications Inc. 60.21 1.13 1.91 19,470,986 Trade
NKE Nike Inc. 74.74 0.41 0.55 8,064,168 Trade
BAC Bank of America Corporation 27.75 -0.15 -0.54 52,456,146 Trade
COF Capital One Financial Corporation 87.64 -1.52 -1.70 3,519,700 Trade
TW Towers Watson & Co. n/a n/a n/a 0 Trade
GEF Greif Inc. Class A 51.31 0.58 1.14 171,198 Trade
MCD McDonald's Corporation 187.59 4.03 2.20 3,759,462 Trade
YGE Yingli Green Energy Holding Company Limited ADR n/a n/a n/a n/a
BXP Boston Properties Inc. 125.57 1.40 1.13 584,350 Trade
SCTY SolarCity Corporation n/a n/a n/a 0 Trade
CRME CORV Minefinders Corporation Ltd. n/a n/a n/a n/a
JOY Joy Global Inc. n/a n/a n/a 0 Trade
JKS JinkoSolar Holding Company Limited American Depositary Shares (each representing 4) 9.28 0.20 2.20 332,349 Trade
PPHM CDMO Peregrine Pharmaceuticals Inc. n/a n/a n/a n/a
HD Home Depot Inc. (The) 177.02 -0.34 -0.19 6,834,880 Trade
XOM Exxon Mobil Corporation 78.96 0.77 0.98 13,704,889 Trade
PFE Pfizer Inc. 43.51 0.30 0.69 23,343,969 Trade
TEVA Teva Pharmaceutical Industries Limited American Depositary Shares 22.25 -0.37 -1.64 9,454,689 Trade
KNX Knight-Swift Transportation Holdings Inc. 31.73 -0.89 -2.73 2,587,547 Trade
NVS Novartis AG 87.75 0.51 0.58 2,188,433 Trade
CSIQ Canadian Solar Inc. 16.00 0.77 5.06 3,023,297 Trade
FDX FedEx Corporation 226.69 -1.12 -0.49 1,240,878 Trade
HPQ HP Inc. 24.16 -0.01 -0.04 8,672,140 Trade
BA The Boeing Company 335.95 -5.62 -1.65 4,425,161 Trade
MRK Merck & Company Inc. (new) 76.06 1.22 1.63 13,725,173 Trade
STL Sterling Bancorp 18.64 0.10 0.54 2,580,862 Trade
ING ING Group N.V. 12.36 -0.10 -0.80 3,261,045 Trade
SNY Sanofi American Depositary Shares (Each repstg one-half of one) 45.10 0.53 1.19 1,229,625 Trade
FE FirstEnergy Corp. 38.77 -0.05 -0.13 3,203,032 Trade
TTWO Take-Two Interactive Software Inc. 113.93 0.87 0.77 3,867,005 Trade
KO Coca-Cola Company (The) 50.17 0.43 0.86 13,405,755 Trade
SF Stifel Financial Corporation 49.75 0.47 0.95 407,050 Trade
T AT&T Inc. 30.29 0.17 0.56 28,929,502 Trade
CAT Caterpillar Inc. 129.96 0.54 0.42 5,957,745 Trade
DDD 3D Systems Corporation 13.11 0.25 1.94 1,408,244 Trade
SOL Renesola Ltd. ADR 1.67 0.01 0.61 18,431 Trade
TOPS TOP Ships Inc. 1.30 -0.08 -5.80 671,185 Trade
MTG MGIC Investment Corporation 12.05 -0.10 -0.82 3,276,413 Trade
MSFT Microsoft Corporation 108.29 1.01 0.94 33,502,121 Trade
CHK Chesapeake Energy Corporation 3.58 -0.15 -4.02 33,107,222 Trade
IQNT Inteliquent Inc. n/a n/a n/a 0 Trade
MFRM Mattress Firm Holding Corp. n/a n/a n/a 0 Trade
CIE Cobalt International Energy Inc. COBALT INTERNATIO n/a n/a n/a n/a
PTEN Patterson-UTI Energy Inc. 15.37 0.28 1.86 2,233,435 Trade
SWSH Swisher Hygiene Inc n/a n/a n/a 0

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