Equities Sector Coverage: Stocks Extend Streak With Modest Gains

Sector Recap |

RIMMMichigan Consumer Sentiment came in at a weak reading of 57.8 in September. Next week we get housing data including Housing Starts and Existing Home Sales and that two-day FOMC meeting. On Wednesday afternoon we learn whether or not the FOMC has any new easing tricks up their sleeves. The Dow Jones Industrial Average continued to rally for the fifth consecutive session trading above 11,500 to 11,532.47 on optimism that the European debt crisis may ease. The Dow dipped to 11,407.41 as Eurozone finance ministers balked at U.S. suggestions before rebounding back above 11,500 in the afternoon. The NASDAQ continued its rally staying above 2600 with a high at 2627.28.

Asian stocks rebounded again on Friday with the Nikkei 225 gaining 2.25% to 8,864 and the Hang Seng higher by 1.43% to 19,455. European stocks reversed gains as Eurozone finance ministers resisted pressures from the US for a solution to their sovereign debt crisis. Stocks ended mixed with the FTSE 100 up 0.58% to 5,368 with the DAX gaining 1.18% to 5,574, and the CAC 40 down 0.48% to 3031. The yield on the 10-Year US Treasury rose from 1.992 percent to 2.118 staying within Thursday’s trading range. Gold traded up from $1765.4 the Troy ounce to $1825.0, as traders continue to observe the potential double top on the daily chart. Crude oil traded down from $89.78 per barrel to $87.00 remaining below its 50- day simple moving average at $90.37. The euro versus the US dollar traded down from 1.3892 to 1.3757.

Energy

Deutsche Bank has Holds on Trina Solar (TSL), SunPower (SPWRA), JinkSolar (JKS), ReneSola (SOL), First Solar (FSLR), Suntech Power (STP), Yingli Green (YGE), Veeco Instruments (VECO), and Itron (ITRI). It has Buys on MEMC Electronic (WFR), and Cree Inc (CREE). In afternoon trading: Shares of Treaty Energy (TECO) are up about 14.25%. Shares of Patriot Coal (PCX) are down about 10%. Shares of Yingli Green are down about 9%. Shares of Suntech Power are down about 6.5%. Shares of Trina Solar are down about 5.75%. Shares of First Solar are down about 5.75%.

Energy Select Sector SPDR (XLE) was trading at $67.09 at 4:00 PM on Friday, down 0.61% on the day – down 1.70% year-to-date.

Materials

HSBC Securities upgrades Iamgold (IAG), Harmony (HMY), and Yamana (AUY) to Overweight from Neutral. Horsehead Holding (ZINC) is hoisted to Outperform from Mkt Perform at FBR Capital. Royal Gold (RGLD) is downgraded to Neutral from Overweight at HSBC. In afternoon trading: Actives: Shares of Alcoa (AA) are relatively unchanged. Shares of Freeport McMoran (FCX) are down about 2.5%. Shares of Vale (VALE) are down about a quarter of a percent. Shares of Dow Chemical (DOW) are up about 1.4%. Shares of Yamana are up about 3.5%.

The Materials Select Sector SPDR (XLB) was trading at $34.52 at 4:00 PM on Friday, down 0.20% on the day – down 10.13% year-to-date.

Industrials

A123 Systems (AONE) gets picked up at Overweight by Piper Jaffray. Flowserve (FLS) is now Buy from Neutral at UBS. American Superconductor (AMSC) is downgraded to Hold with Wunderlich with a new target of $6. In afternoon trading: Shares of YRC Worldwide (YRCW) are down about 77% after shareholders agreed to increase the trucking company’s share count to 1.9 billion from 48 billion, a massive dilution of existing shareholders. The increase is part of the company’s restructuring plan to avoid bankruptcy. Shares of Broadwind Energy (BWEN) are down about 18% on after the company announced that it has priced an underwritten public offering of 32.5M shares of its common stock at a price to the public of $0.40/share for gross proceeds of $13.0M.

The Industrial Select Sector SPDR (XLI) was trading at $31.97 at 4:00 PM on Friday, down slightly on the day – down 8.32% year-to-date.

Consumer Discretionary

McCormick & Schmick’s (MSSR) is a new Buy at Capstone. Publicis Groupe SA (PUBGY) is boosted to Buy from Hold at the Royal Bank of Scotland.  In afternoon trading: Shares of Wonder Auto Technology (WATG) are down about 9.7%. Shares of Netflix (NFLX) are down about 7.8%. Shares of Cumulus Media (CMLS) are down about 6.1%. Shares of 99 Cents Only Stores (NDN) are up about 9.6%. Shares of Deer Consumer Products (DEER) are up about 9.1%. Actives: Shares of Sirius XM (SIRI) are down about 0.8%. Shares of Ford Motor (F) are down about 0.9%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $37.77 at 4:00 PM on Friday, up 0.77% on the day – up 0.96% year-to-date.

Consumer Staples

Revlon (REV) is raised to Outperform from Market Perform by BMO Capital. In afternoon trading: Shares of Diamond Foods (DMND) are up about 9%. Shares of Farmer Brothers (FARM) are up about 7.8%. Shares of Revlon are up about 6.2%. Shares of Hansen Natural (HANS) are up about 5.2%. Shares of AgFeed Industries (FEED) are down about 5.6%. Actives: Shares of Procter & Gamble (PG) are up about 2.8%. Shares of Altria Group (MO) are down about 0.3%. Shares of Coca Cola (KO) are up about 0.5%. Shares of Pepsi (PEP) are down about 2.1%. Shares of Wal-Mart (WMT) are up about 0.5%. Shares of CVS Caremark (CVS) are down about 1.7%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $30.84 at 4:00 PM on Friday, down slightly on the day – up 5.22% year-to-date.

Healthcare

Allergan (AGN) is begun with a Buy at Deutsche Bank. Biomarin Pharmaceuticals (BMRN) is picked up at Outperform by RBC Capital. Raptor Pharmaceuticals (RPTP) is resumed with an Outperform recommendation and $11 price objective at Oppenheimer. Gilead Sciences (GILD) gets a Buy-from-Neutral increase at Goldman. In afternoon trading: Shares of Anadys Pharmaceuticals (ANDS) are up about 18.7%. Shares of XOMA (XOMA) are up about 7.5%. Shares of Arena Pharmaceuticals (ARNA) are up about 7.4%. Shares of Warner Chilcott (WCRX) are up about 7%. Shares of Zoll Medical (ZOLL) are down about 8%.

The Health Care Select Sector SPDR (XLV) was trading at $33.02 at 4:00 PM on Friday, unchanged on the day – up 4.83% year-to-date.

Financials

Following the arrest of a UBS (UBS) employee who allegedly racked up $2B in losses from unauthorized trading, Moody's places the bank's Aa3 rating under review. Goldman Sachs (GS) informs clients it will close down its quantitative-based Global Alpha fund by the end of October as a combination of losses and redemptions brings assets under management down to $1B from about $12B at its peak before the financial crisis. Morgan Stanley (MS) Chairman John Mack - who led a savage round of cost cuts at the firm's fixed income division on his way to becoming CEO - will retire at the end of the year. Current CEO James Gorman will assume his duties. Citigroup (C) is begun with a Market Perform at Wells Fargo. TD Ameritrade (AMTD) is taken to Buy from Hold at Citigroup. Royal Bank of Scotland (RBS) is upgraded to Add from Neutral at West LB. In afternoon trading: Shares of Washington Mutual (WAMUQ) are down about 12.5%. Shares of The PMI Group (PMI) are down about 11%.

The Financial Select Sector SPDR (XLF) was trading at $12.91 at 4:00 PM on Friday, down slightly on the day – down 19.09% year-to-date.

Information Technology

Research in Motion (RIMM) missed FQ2 forecasts on both the top and bottom line. Shipments for the Playbook tablet totaled just 200K, less than half street consensus of 490K. Guidance for FQ3 was largely in-line with estimates as the company is confident a "major" software update and promotions will generate better sales later this year. Research In Motion is reduced to Market Perform from Outperform by Raymond James and to Underperform from Sector Perform at Pacific Crest. Beijing Jingdong Century Trading Company, which runs online shopping site 360buy.com, hopes to raise $4-$5B in a 2012 U.S. IPO - a number that would dwarf Google's (GOOG) $1.9B 2004 offering as the largest ever for an internet firm. After a week of volatility following the dismissal of CEO Carol Bartz, Yahoo (YHOO) has drawn the attention of strategic investors and buyout shops, including Silver Lake - which has already approached the Web giant with an offer, working with Andreessen Horowitz. Dominant search engine Google (GOOG) reports that display ad spending from its biggest advertisers more than doubled over the past year, due to improved sales technologies and, well, more advertisers. With its SEC issue resolved and markets a bit calmer, the online coupon giant Groupon is gassing up for its road show and hopes to go public in late October or early November. Barclays launches Overweights on Linkedin (LNKD), Demand Media (DMD), InterActiveCorp (IACI), and Shutterfly (SFLY). It has Underweights on WebMD Health (WBMD) and OpenTable (OPEN). Vitesse Semiconductor (VTSS) is initiated with a Hold and price target of $3.50 at Wunderlich. Plexus (PLXS) is a new Neutral at Goldman Sachs. Deutsche Bank has Holds on Trina Solar (TSL), SunPower (SPWRA), JinkSolar (JKS), ReneSola (SOL), First Solar (FSLR), Suntech Power (STP), Yingli Green (YGE), Veeco Instruments (VECO), and Itron (ITRI). It has Buys on MEMC Electronic (WFR), and Cree Inc (CREE). Aixtron (AIXG) is upgraded to Hold from Sell at the Royal Bank of Scotland. Adobe Systems (ADBE) is downgraded to Market Perform from Outperform at JMP Securities.  MasterCard (MA) is now Neutral from Outperform with a $385 target price at brokers Robert W. Baird. Veeco Instruments (VECO) is now Neutral from Buy at Bank of America-Merrill Lynch. In afternoon trading: Shares of RIMM are down about 20%.

The Technology Select Sector SPDR (XLK) was trading at $24.98 at 4:00 PM on Friday, up 0.73% on the day – down 0.83% year-to-date.

Telecommunications Services

In afternoon trading: Shares of Cogent Communications Group (CCOI) are up about 7%. Actives: Shares of Sprint Nextel (S) are down about 4%. Shares of AT&T (T) are up about 0.8%. Shares of Verizon (VZ) are up about 0.8%. Shares of Level 3 Communications (LVLT) are down about 2.8%. Shares of Frontier Communications (FTR) are up about a half of a percent. Shares of MetroPCS (PCS) are down about 3%.

The NASDAQ Telecommunications Index (IXTC) was trading at $195.80 at 4:00 PM on Friday, down 0.93% on the day – down 13.12% year-to-date.

Utilities

E.ON AG (EONGY) gets moved to Overweight from Neutral at JP Morgan. In afternoon trading: Actives: Shares of Duke Energy (DUK) are up about 0.6%. Shares of American Electric Power (AEP) are down about 0.6%. Shares of Southern (SO) are up about 1%. Shares of AES Corp (AES) are up about 1.3%. Shares of Exelon (EXC) are up about 1.2%. Shares of Genon Energy (GEN) are down about 1%. Shares of PPL Corp (PPL) are up about 1%. Shares of CenterPoint Energy (CNP) are up about 0.2%.

The Utilities Select Sector SPDR (XLU) was trading at $33.98 at 4:00 PM on Friday, up slightly on the day – up 8.42% year-to-date.

STOCKS: TSL, SPWRA, JKS, SOL, FSLR, STP, YGE, VECO, ITRI, WFR, CREE, TECO, PCX, IAG, HMY, AUY, ZINC, RGLD, AA, FCX, VALE, DOW, AONE, FLS, AMSC, YRCW, BWEN, MSSR, PUBGY, WATG, NFLX, CMLS, NDN, DEER, SIRI, F, REV, DMND, FARM, HANS, FEED, PG, MO, KO, PEP, WMT, CVS, AGN, BMRN, RPTP, GILD, ANDS, XOMA, ARNA, WCRX, ZOLL, UBS, GS, MS, C, AMTD, RBS, WAMUQ, PMI, RIMM, GOOG, YHOO, LNKD, DMD, IACI, SFLY, WBMD, OPEN, VTSS, PLXS, AIXG, ADBE, MA, CCOI, S, T, VZ, LVLT, FTR, PCS, EONGY, DUK, AEP, SO, AES, EXC, GEN, PPL, CNP

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
AA Alcoa Inc. 9.76 -0.02 -0.20 12,146,577
ABT Abbott Laboratories 42.19 -0.03 -0.07 6,912,285
ADBE Adobe Systems Incorporated 107.47 -0.45 -0.42 3,087,239
AEP American Electric Power Company 66.66 0.06 0.09 2,031,124
AES The AES Corporation 13.26 0.07 0.53 3,955,833
AGN Allergan plc 243.94 0.51 0.21 2,686,485
AIXG Aixtron SE 6.11 -0.06 -0.97 14,178
AMSC American Superconductor Corporation 6.83 -0.11 -1.59 27,549
AMTD TD Ameritrade Holding Corporation 33.12 -0.54 -1.60 1,950,853
ARNA Arena Pharmaceuticals Inc. 1.74 -0.03 -1.69 1,415,905
AUY Yamana Gold Inc. (Canada) 4.49 -0.20 -4.26 19,561,614
BMRN BioMarin Pharmaceutical Inc. 97.40 -0.05 -0.05 812,600
BWEN Broadwind Energy Inc. 4.35 -0.06 -1.36 16,543
C Citigroup Inc. 47.15 0.04 0.08 14,793,526
CCOI Cogent Communications Holdings Inc. 37.13 0.18 0.49 220,210
CMLS Cumulus Media Inc. 0.32 -0.02 -4.87 167,955
CNP CenterPoint Energy Inc (Holding Co) 24.19 0.08 0.33 3,008,593
CREE Cree Inc. 24.97 -0.07 -0.28 537,263
CVS CVS Health Corporation 90.60 0.03 0.03 3,865,273
DMD Demand Media Inc. 5.80 0.01 0.17 35,474
DMND Diamond Foods Inc. n/a n/a n/a 0
DUK Duke Energy Corporation (Holding Company) 82.52 0.01 0.01 2,348,821
EXC Exelon Corporation 34.80 -0.42 -1.19 3,946,652
F Ford Motor Company 12.17 -0.01 -0.08 18,993,510
FARM Farmer Brothers Company 36.45 0.25 0.69 174,657
FCX Freeport-McMoRan Inc. 10.63 -0.35 -3.19 22,336,624
FLS Flowserve Corporation 46.18 -1.99 -4.13 1,308,226
FSLR First Solar Inc. 37.06 1.64 4.63 4,412,931
FTR Frontier Communications Corporation 4.33 0.00 0.00 19,247,444
GEN Genesis Healthcare Inc. 2.72 -0.07 -2.51 154,075
GILD Gilead Sciences Inc. 81.37 -0.15 -0.18 7,534,538
GOOG Alphabet Inc. 786.90 -0.31 -0.04 1,411,937
GS The Goldman Sachs Group Inc. 165.13 -2.89 -1.72 3,421,183
HMY Harmony Gold Mining Company Limited 3.50 -0.05 -1.41 3,046,524
IACI IAC/InterActiveCorp n/a n/a n/a 0
IAG Iamgold Corporation 4.12 -0.19 -4.41 7,342,082
ITRI Itron Inc. 55.17 -0.69 -1.24 255,923
JKS JinkoSolar Holding Company Limited American Deposi 15.18 0.01 0.07 527,891
KO Coca-Cola Company (The) 42.74 -0.22 -0.51 8,852,719
LNKD LinkedIn Corporation Class A 192.79 0.31 0.16 974,626
LVLT Level 3 Communications Inc. 47.55 0.15 0.32 3,135,539
MO Altria Group Inc. 63.87 -0.25 -0.39 4,428,499
MS Morgan Stanley 31.91 -0.33 -1.02 9,400,557
NFLX Netflix Inc. 95.94 0.11 0.11 6,179,471
PEP Pepsico Inc. 107.34 -0.48 -0.45 3,235,889
PG Procter & Gamble Company (The) 87.76 -1.23 -1.38 48,281,375
PLXS Plexus Corp. 47.18 -0.54 -1.13 127,345
PPL PPL Corp 35.70 -0.12 -0.34 4,155,500
RBS Royal Bank of Scotland Group Plc New (The) ADS 4.75 -0.12 -2.46 1,784,362
REV Revlon Inc. New 36.77 0.40 1.10 51,516
RGLD Royal Gold Inc. 81.42 -2.67 -3.18 624,065
RPTP Raptor Pharmaceutical Corp. 9.00 0.04 0.39 1,825,660
S Sprint Corporation 6.64 0.02 0.30 8,699,931
SFLY Shutterfly Inc. 44.67 -0.28 -0.62 820,155
SIRI Sirius XM Holdings Inc. 4.21 0.00 0.00 43,030,687
SO Southern Company (The) 53.53 0.05 0.09 4,282,665
SOL Renesola Ltd. of Beneficial Interest 1.00 -0.01 -0.99 199,480
T AT&T Inc. 41.28 0.17 0.41 18,867,573
TSL Trina Solar Limited Sponsored ADR (Cayman Islands) 10.32 -0.11 -1.05 1,190,629
UBS UBS Group AG Registered 13.81 -0.16 -1.15 1,147,236
VALE VALE S.A. American Depositary Shares Each Represen 5.42 0.00 0.00 15,016,506
VECO Veeco Instruments Inc. 19.17 -0.25 -1.29 107,609
VZ Verizon Communications Inc. 52.56 0.21 0.40 13,014,796
WBMD WebMD Health Corp 50.30 -0.38 -0.75 469,139
WMT Wal-Mart Stores Inc. 72.35 0.08 0.11 7,696,449
XOMA XOMA Corporation 0.52 -0.00 -0.02 922,500
YGE Yingli Green Energy Holding Company Limited ADR 3.89 0.19 5.14 119,703
YHOO Yahoo! Inc. 42.80 -1.35 -3.06 31,888,521
YRCW YRC Worldwide Inc. 12.35 0.09 0.73 539,689
ZINC Horsehead Hldg Corp n/a n/a n/a 0

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