Equities Sector Coverage: Stocks Edge Lower Ahead of Earnings

Sector Recap |

nyse, wall street, economy, stock marketThe Dow Jones Industrial Average traded down to 12,686.57 on Monday morning then rebounded in the afternoon. The NASDAQ traded down to 2919.04 on Monday morning then rebounded in the afternoon.

Asian stocks were lower on Monday. The Nikkei 225 ended the day at 8,897 – down 1.37%. The Hang Seng ended the day at 19,428 – down 1.88%. European exchanges traded lower on Monday. The FTSE 100 ended the day at 5,627 – down 0.62%. The DAX ended the day at 6,388 – down 0.35%. The CAC 40 ended the day at 3,157 – down 0.38%. The yield on the 10-Year US Treasury note traded down from 1.549% to 1.505% on Monday.

Gold rebounded from $1576.0 the Troy ounce to $1593.1 on Monday as the 50-day and 200-day simple moving averages decline to $1598.2 and $1661.1. Crude oil rebounded from $84.00 per barrel to $86.48 trading between its 200-week simple moving average at $80.35 and the 50-day at $89.04. The euro versus the dollar rebounded from 1.2259 to 1.2323.

Energy

Cabot Oil & Gas (COG) has been upgraded to Buy from Neutral at Goldman. Carrizo Oil & Gas (CRZO) has been downgraded to Market Perform from Outperform at BMO Capital. Ormat Tech (ORA) has been downgraded to Underweight from Equal Weight at Barclays. Dow components – Chevron (CVX) down 0.95%, Exxon Mobil (XOM) down 1.75%.
Energy Select Sector SPDR (XLE) was trading at $65.89 at 3:30 PM on Monday, down 0.60% on the day – down 4.69% year-to-date.

Materials

Alcoa (AA) kicks off the second quarter earnings results today, and analysts have sharply cut their EPS estimates to just $0.05 vs. $0.32 a year ago. Revenues are projected to slide 11.8% to $5.81 billion. Producing aluminum is being pressured by rising input costs and sinking finished-product prices. LyondellBasell (LYB) has been upgraded to Outperform from Neutral at Macquarie. Thompson Creek Metals (TC) has been upgraded to Buy from Hold at Deutsche Bank. Weyerhaeuser (WY) has been upgraded to Buy from Neutral at Citigroup. Smithfield Foods (SFD) and Archer Daniels (ADM) have been downgraded to Market Perform from Outperform at BMO Capital. Pan Am Silver (PAAS) has been downgraded to Hold from Buy at Deutsche Bank. Dow components – Alcoa (AA) down 1.73%, DuPont (DD) down 2.04%.
The Materials Select Sector SPDR (XLB) was trading at $34.90 at 3:30 PM on Monday, down 0.71% on the day – up 4.18% year-to-date.

Industrials

United Technologies (UTX) Sikorsky Aircraft division has signed a five-year $7.3 billion deal to supply the US armed forces with H-60 Black Hawk helicopters and additional versions of the aircraft. The agreement is the eighth multi-year procurement of the helicopters including options that could add $1 to $2 billion to the value of the contract. General Motors (GM) believes that faster growth in Russia will partially offset slowing sales in China. Mueller Water (MWA) has been upgraded to Buy from Hold at Brean Murray with a $5.10 price target. Catalysts include the recent positive housing data. Alaska Air (ALK) has been downgraded to Underweight from Equal Weight at Barclays. Dow components – Boeing Co (BA) up 0.75%, Caterpillar (CAT) down 1.43%, General Electric (GE) down 0.15%, 3M Company (MMM) down 0.38%, United Technologies (UTX) down 0.24%.
The Industrial Select Sector SPDR (XLI) was trading at $35.15 at 3:30 PM on Monday, down 0.17% on the day – up 4.15% year-to-date.

Consumer Discretionary

Coach (COH) has been upgraded to Overweight from Neutral at Atlantic Equities. Pearson Plc (PSO) has been downgraded to Neutral from Buy at Citigroup. PetSmart (PETM) has been downgraded to Hold from Buy at Needham amid valuation concerns. Dow Components – Disney (DIS) down 0.22%, Home Depot down 0.08%, McDonalds (MCD) down 0.36%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $43.50 at 3:30 PM on Monday, down 0.62% on the day – up 11.48% year-to-date.



Consumer Staples

DSW Inc (DSW) - The shoe company is initiated with a Hold rating at Canaccord Genuity Boston Beer (SAM) has been downgraded to Sell from Neutral at UBS. Dollar Tree (DLTR) has been downgraded to Underweight from Equal Weight at Morgan Stanley. Smithfield Foods (SFD) and Archer Daniels (ADM) have been downgraded to Market Perform from Outperform at BMO Capital. Tyson Foods (TSN) has been downgraded to Market Perform from Outperform at BMO Capital. Dow components – Kraft (KFT) down 0.10%, Coca Cola (KO) down 0.23%, Procter & Gamble (PG) up 0.55%, Wal-Mart (WMT) up 0.29%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $34.87 at 3:30 PM on Monday, down 0.26% on the day – up 7.33% year-to-date.

Health Care

WellPoint (WLP) will acquire Amerigroup (AGP) for $92 a share in a cash deal worth about $4.9 billion. The offer represents a 43% premium over Amerigroup's closing price on Friday, and AGP shares were up 40% in the premarket. Celgene (CELG) is one of two firms other than GSK (GSK) considering buying Human Genome Sciences (HGSI) and holding talks with the company. Human Genome will be holding an auction, and the deadline for bids is July 16. Nanosphere (NSPH) has been upgraded to Buy from Neutral at ROTH Capital. Sirona Dental Systems (SIRO) has been upgraded to Outperform from Perform at Robert W. Baird. Lincare (LNCR) has been downgraded to Hold from Buy at Jefferies. Dow Components – Johnson & Johnson (JNJ) up 0.37%, Merck (MRK) up 1.08%, Pfizer (PFE) up 0.10%.
The Health Care Select Sector SPDR (XLV) was trading at $37.82 at 3:30 PM on Monday, up 0.50% on the day – up 9.02% year-to-date.

Financial

According to Britain’s Sunday Times, Barclays (BCS) is considering spinning off its investment-banking unit following the Libor scandal. The division could be headquartered in New York while the UK-based retail and commercial bank businesses stay in London. Wells Fargo (WFC) has been initiated with a Buy rating at Jefferies. MasterCard (MA) and Visa (V) have been downgraded to Sell from Neutral at UBS, sending each lower before the open on Monday. State Street (STT) has been downgraded to Neutral from Buy at Goldman. TD Ameritrade (AMTD) has been downgraded to Sell from Neutral at Goldman. Dow Components – American Express (AXP) down 0.98%, Bank of America (BAC) down 0.52%, JP Morgan Chase (JPM) down 0.44%, Travelers (TRV) down 0.19%.

The Financial Select Sector SPDR (XLF) was trading at $14.42 at 3:30 PM on Monday, down 0.35% on the day – up 10.92% year-to-date.

Information Technology

Entropic Communications (ENTR) has been initiated with a Buy rating and $8 price target at Needham, which sees the company gaining market share in the set-top box arena. Youku.com (YOKU) has been initiated with an Overweight rating at JP Morgan. Lam Research (LRCX) has been downgraded to Outperform from Buy at Credit Agricole. SolarWinds (SWI) has been downgraded to Market Perform from Outperform at FBR Capital. Dow Components – Cisco Systems (CSCO) down 0.72%, Hewlett-Packard (HPQ) down 0.69%, IBM (IBM) down 1.13%, Intel Corp (INTC) down 0.99%, Microsoft (MSFT) down 0.66%.
The Technology Select Sector SPDR (XLK) was trading at $28.59 at 3:30 PM on Monday, down 0.35% on the day – up 12.34% year-to-date.

Telecommunication Services

Equinix (EQIX) has been initiated with a Buy rating at Deutsche Bank.Dow Components – AT&T Inc down 0.14%, Verizon (VZ) up 0.20%.
The NASDAQ Telecommunications Index (IXTC) was trading at $181.04 at 3:30 PM on Monday, down 0.74% on the day – down 8.07% year-to-date.

Utilities

Dominion Resources (D) down 0.37%, Edison International (EIX) up 0.22%, First Energy (FE) down 0.20%, PG&E Corp (PCG) down 0.16%, Southern Company (SO) up 0.43%.
The Utilities Select Sector SPDR (XLU) was trading at $36.70 at 3:30 PM on Monday, down 0.35% on the day – up 2.00% year-to-date.

STOCKS: CVX, XOM, COG, CRZO, ORA, AA, DD, LYB, TC, WY, SFD, ADM, PAAS, BA, CAT, GE, MMM, UTX, GM, MWA, ALK, DIS, HD, MCD, COH, PSO, PETM, KFT, KO, PG, WMT, DSW, SAM, DLTR, TSN, AVP, JNJ, MRK, PFE, WLP, AGP, CELG, GSK, HGSI, NSPH, SIRO, LNCR, AXP, BAC, JPM, TRV, BCS, WFC, MA, V, STT, AMTD, CSCO, HPQ, IBM, INTC, MSFT, ENTR, YOKU, LRCX, SWI, T, VZ, EQIX, D, EIX, FE, PCG, SO

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 200.05 1.02 0.51 2,175,148 Trade
COG Cabot Oil & Gas Corporation 25.18 0.02 0.08 6,260,436 Trade
GSK GlaxoSmithKline PLC 40.75 -0.10 -0.24 3,673,080 Trade
SAM Boston Beer Co. Cl A 135.65 1.70 1.27 182,981 Trade
TSN Tyson Foods Inc. 63.36 0.33 0.52 1,633,046 Trade
EQIX Equinix Inc. 442.87 2.83 0.64 374,045 Trade
PG Procter & Gamble Company (The) 90.68 1.38 1.55 11,089,181 Trade
GE General Electric Co 25.79 0.20 0.78 39,888,012 Trade
CVX Chevron Corporation 106.11 0.99 0.94 5,888,389 Trade
SO Southern Company (The) 47.82 0.42 0.89 4,629,121 Trade
PCG Pacific Gas & Electric Co. 67.55 -0.35 -0.52 2,842,161 Trade
CRZO Carrizo Oil & Gas Inc. 15.89 0.34 2.19 3,677,830 Trade
JNJ Johnson & Johnson 130.83 -0.12 -0.09 5,838,110 Trade
WMT Wal-Mart Stores Inc. 79.78 0.88 1.12 8,052,464 Trade
AA Alcoa Inc. 36.36 -0.27 -0.74 2,044,409 Trade
INTC Intel Corporation 34.97 0.22 0.63 43,062,842 Trade
IBM International Business Machines Corp 145.07 -0.29 -0.20 6,430,841 Trade
D Dominion Resources Inc. 77.12 0.07 0.09 1,553,339 Trade
TRV The Travelers Companies Inc. 125.88 -0.12 -0.10 1,694,031 Trade
AGII Argo Group International Holdings Ltd. 59.15 -1.40 -2.31 133,660 Trade
BCS Barclays PLC 10.87 -0.17 -1.54 3,672,405 Trade
EIX Edison International 79.22 0.31 0.39 1,312,466 Trade
ALK Alaska Air Group Inc. 87.98 0.26 0.30 2,459,829 Trade
JPM JP Morgan Chase 91.55 -0.38 -0.41 12,332,375 Trade
AXP American Express Company 83.85 -1.45 -1.70 6,119,259 Trade
AMTD TD Ameritrade Holding Corporation 45.96 -0.17 -0.37 1,956,303 Trade
LRCX Lam Research Corporation 164.76 -3.58 -2.13 5,665,243 Trade
UTX United Technologies Corporation 118.69 -0.85 -0.71 4,257,311 Trade
AVP Avon Products Inc. 3.74 0.04 1.08 3,646,020 Trade
V Visa Inc. 99.57 -1.28 -1.27 10,543,859 Trade
SIRO Sirona Dental Systems Inc. n/a n/a n/a 0 Trade
CSCO Cisco Systems Inc. 31.57 -0.09 -0.28 21,437,389 Trade
WY Weyerhaeuser Company 34.23 0.31 0.91 4,104,457 Trade
DIS Walt Disney Company (The) 110.00 3.06 2.86 10,468,680 Trade
LYB LyondellBasell Industries NV Class A (Netherlands) 86.53 -0.81 -0.93 2,959,929 Trade
COH Coach Inc. 47.97 0.08 0.17 4,513,342 Trade
VZ Verizon Communications Inc. 47.81 3.41 7.68 44,702,494 Trade
NSPH Nanosphere Inc n/a n/a n/a 0 Trade
GM General Motors Company 35.94 0.32 0.90 10,006,533 Trade
DLTR Dollar Tree Inc. 72.24 1.32 1.86 3,007,469 Trade
BAC Bank of America Corporation 24.11 -0.10 -0.41 62,902,110 Trade
ORA Ormat Technologies Inc. 58.50 -0.66 -1.12 120,301 Trade
MCD McDonald\'s Corporation 156.95 0.44 0.28 4,624,114 Trade
PSO Pearson Plc 8.50 0.12 1.43 434,425 Trade
PAAS Pan American Silver Corp. 16.48 -0.47 -2.77 1,593,459 Trade
ADM Archer-Daniels-Midland Company 41.78 0.07 0.17 2,978,055 Trade
DD E.I. du Pont de Nemours and Co. 84.59 0.16 0.19 2,191,217 Trade
TC TC n/a n/a n/a 0
DSW DSW Inc. 18.72 0.88 4.93 1,706,839 Trade
HD Home Depot Inc. (The) 147.73 1.04 0.71 5,399,029 Trade
XOM Exxon Mobil Corporation 80.83 0.46 0.57 11,149,690 Trade
PFE Pfizer Inc. 33.00 0.11 0.33 16,661,472 Trade
WFC Wells Fargo & Company 54.71 -0.20 -0.36 17,352,646 Trade
HPQ HP Inc. 19.21 -0.05 -0.26 14,731,886 Trade
BA Boeing Company (The) 241.00 7.55 3.23 10,860,578 Trade
CELG Celgene Corporation 134.15 -3.60 -2.61 6,048,153 Trade
MRK Merck & Company Inc. (new) 63.69 1.89 3.06 21,846,256 Trade
SWI SolarWinds n/a n/a n/a 0 Trade
FE FirstEnergy Corporation 31.25 0.15 0.48 5,909,171 Trade
YOKU Youku Tudou Inc ADR (Sponsored) n/a n/a n/a 0 Trade
KO Coca-Cola Company (The) 46.12 0.38 0.83 15,195,172 Trade
T AT&T Inc. 39.41 1.38 3.63 61,986,966 Trade
MWA MUELLER WATER PRODUCTS 11.49 0.08 0.70 754,669 Trade
CAT Caterpillar Inc. 114.37 0.85 0.75 5,583,481 Trade
MSFT Microsoft Corporation 73.16 -0.89 -1.20 36,844,220 Trade

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