Equities Sector Coverage: Stocks Fall Ahead of Jackson Hole

Sector Recap  |

Initial Jobless Claims were unchanged at 374,000 still above the 350,000 recessionary threshold. Personal Income rose 0.3% in July with Spending up 0.4%. The Dow Jones Industrial Average traded down to 12,978.91. The NASDAQ traded down to 3045.92.

Asian stocks were lower on Thursday. The Nikkei 225 ended the day at 8,984 – down 0.95%. The Hang Seng ended the day at 19,553 – down 1.19%. European exchanges traded lower on Thursday. The FTSE 100 ended the day at 5,719 – down 0.42%. The DAX ended the day at 6,895 – down 1.64%. The CAC 40 ended the day at 3,379 – down 1.02%. The yield on the 10-Year US Treasury note declined from 1.657% to 1.608% versus the five-week modified moving average at 1.649%.

Gold traded rebounded to $1666.7 the Troy ounce then declined to $1652.3 staying above the 200-day simple moving average at $1646.4. Crude oil traded rebounded to $95.60 per barrel then declined to $93.95 versus the 200-day simple moving average at $96.70. The euro versus the dollar traded down from 1.2563 to 1.2491 above its 50-day simple moving average at 1.2365.

Energy

Magnum Hunter Resources (MHR) is a new Neutral at Goldman Sachs. Natural Resource Partners (NRP) is a new Hold at Dahlman Rose. QR Energy (QRE) is initiated with an Overweight at JP Morgan. Frontline (FRO) is upgraded to Market Perform from Underperform with Wells Fargo. Nexen (NXY) is now Equal Weight from Overweight at Barclays. Oiltanking Partners (OILT) is moved to Neutral from Buy at Bank of America-Merrill.

Dow components – Chevron (CVX) down 0.36%, Exxon Mobil (XOM) down 0.16%.

Energy Select Sector SPDR (XLE) was trading at $71.02 at 3:30 PM on Thursday, down 0.78% on the day – up 2.73% year-to-date.

Materials

LyondellBasell (LYB) will replace Sears (SHLD) in the S&P 500 after the close of trading next Tuesday. Carlyle Group (CG) to Buy DuPont (DD) Performance Coatings Business for $4.9 Billion. Louisiana-Pacific (LPX) is moved to Buy from Neutral at Bank of America-Merrill Lynch. Louisiana-Pacific (LPX) is downgraded to Hold from Buy at Deutsche Bank.

Dow Components – Alcoa (AA) up 0.71%, DuPont (DD) up 0.72%.

The Materials Select Sector SPDR (XLB) was trading at $35.40 at 3:30 PM on Thursday, down 0.65% on the day – up 5.67% year-to-date.

Industrials

AMR (AAMRQ) is in negotiations to receive $1B-$2B in equity financing from a group of distressed debt funds that includes JPMorgan Securities (JPM) and which holds over $600M in the carrier's bonds. The money would help AMR exit bankruptcy protection and put it in a stronger position as it negotiates a potential merger with US Airways (LCC). Casella Waste Systems (CWST) missed estimates by 7 cents with revenue in-line with estimates. Flow International (FLOW) reported Q2 EPS of $0.05 (in-line), while beating revenue by $1.5M. Equifax (EFX) is assigned with a Hold at Deutsche Bank. Volvo (VOLVY) is hoisted to Buy from Hold at Société Générale.

Dow components – Boeing Co (BA) up 0.29%, Caterpillar (CAT) up 0.10%, General Electric (GE) up 0.53%, 3M Company (MMM) up 0.31%, United Technologies (UTX) down 0.31%.

The Industrial Select Sector SPDR (XLI) was trading at $36.27 at 3:30 PM on Thursday, down 0.49% on the day – up 7.47% year-to-date.

Consumer Discretionary

South Korea's Mando said it may offer to acquire the 70% of Halla Climate Control that's owned by U.S. autoparts company Visteon (VC). LyondellBasell (LYB) will replace Sears (SHLD) in the S&P 500 after the close of trading next Tuesday. Pier 1 Imports (PIR) beat estimates by a penny and revenue by $2M. Pandora Media (P) beat estimates by 3 cents with revenue in-line with estimates. FQ3 guidance is for revenue of $115M-$118M and EPS of $0.00-$0.01 (largely above consensus of $114.4M and $0.00). FY13 guidance is for revenue of $425M-$432M and EPS of -$0.04 to -$0.08 (above consensus of $424.2M and -$0.12). Oxford Industries (OXM) beat estimates by 2 cents and revenue by $2M. However, the company came up short in its FY12 guidance; affirming its previously issued guidance range of $2.85 to $2.95 and net sales of $850M to $865M (versus the Street of $2.99 per share in earnings on sales of $866M). Coldwater Creek (CWTR) beat estimates by 4 cents, while missing revenue by $16M. Vera Bradley (VRA) missed estimates by 2 cents, while beating revenue by $1M. Kingfisher (KGFHY) is moved to Buy from Neutral at Citigroup. Pandora (P) is upgraded to Buy from Hold at Canaccord. World Wrestling Entertainment (WWE) is raised to Buy from Neutral at Roth Capital.

Big Movers – Pandora (P) up 10.56%, Vera Bradley (VRA) down 10.54%
Dow Components – Disney (DIS) up 0.97%, Home Depot (HD) up 0.72%, McDonalds (MCD) down 0.56%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $45.47 at 3:30 PM on Thursday, down 0.31% on the day – up 16.53% year-to-date.

Consumer Staples

Costco (COST) reported August comparable-store sales +6% (consensus +4.5%). Dow components – Kraft (KFT) down 0.41%, Coca Cola (KO) down 1.08%, Procter & Gamble (PG) up 0.04%, Wal-Mart (WMT) up 0.54%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $35.54 at 3:30 PM on Thursday, down 0.14% on the day – up 9.39% year-to-date.

Health Care

Bio-Reference Laboratories (BRLI) beat estimates by 3 cents with revenue in-line with estimates. Greenway (GWAY) beat estimates by a penny and revenue by $2M. Aetna (AET) is a new Neutral at Credit Suisse. Centene (CNC) is covered with a Neutral at Credit Suisse. Cepheid (CPHD) is a Hold at Cantor Fitzgerald. Geron Corp (GERN) is begun with a Buy at Stifel Nicolaus. Vertex Pharmaceuticals (VRTX) is begun with a Buy at ThinkEquity. Cigna (CI) is moved to Outperform from Neutral at Credit Suisse. Cadence Pharmaceuticals (CADX) is moved to Market Perform from Outperform at Leerink. Coventry Health Care (CVH) is downgraded to Neutral from Outperform at Credit Suisse as they are no longer trading on fundamentals following this week’s acquisition offer from Aetna (AET). Humana (HUM) is now Neutral from Outperform at Credit Suisse. Triple-S Management (GTS) gets downgraded to Neutral from Outperform at Credit Suisse.

Big Movers – StemCells (STEM) up 17.39%, Sarepta Therapeutics (SRPT) up 16.90%
Dow Components – Johnson & Johnson (JNJ) up 0.20%, Merck (MRK) up 0.74%, Pfizer (PFE) up 0.84%.

The Health Care Select Sector SPDR (XLV) was trading at $38.79 at 3:30 PM on Thursday, down 0.15% on the day – up 11.82% year-to-date.

Financial

Barclays (BCS) has named Antony Jenkins as CEO to replace Bob Diamond, who resigned in the wake of the Libor scandal. Scotiabank (BNS) has agreed to acquire the Canadian online bank of ING (ING) for $3.16B in a deal that will provide the Dutch company with a $1.4B after-tax gain. Louis Freeh, the trustee for MF Global's (MFGLQ) parent company, yesterday called on the firm's other bankruptcy administrators in the U.S. and U.K. to come to a "global resolution" with him over getting money back for creditors and clients rather than going through costly and time-consuming litigation. Carlyle Group (CG) to Buy DuPont (DD) Performance Coatings Business for $4.9 Billion. Royal Bank of Canada (RY) posts adjusted FQ3 earnings of $1.31/share, beating estimates by $0.13. Toronto Dominion Bank (TD) beat estimates by C$0.09 and revenue by C$70M. IntercontinentalExchange (ICE) is downgraded to Outperform from Strong Buy at Raymond James.

Dow Components – American Express (AXP) down 0.03%, Bank of America (BAC) up 0.50%, JP Morgan Chase (JPM) up 0.59%, Travelers (TRV) down 0.02%.

The Financial Select Sector SPDR (XLF) was trading at $15.092 at 3:30 PM on Thursday, down 0.25% on the day – up 16.09% year-to-date.

Information Technology

Intel (INTC) has provided details about its wireless charging technology for notebooks and mobile devices, saying that unlike older technology that requires a "charging mat" (such as with electric toothbrushes), it can work simply by placing two devices near each other and running the required software. Ciena (CIEN) missed estimates by 2 cents with revenue in-line with estimates. Methode Electronics (MEI) beat estimates by 9 cents with revenue in-line with estimates. TiVo (TIVO) beat estimates by a penny with revenue in-line with estimates. Alliance Data Systems (ADS) is a new Neutral at Citigroup. Brightcove (BCOV) gets a Strong Buy-from-Outperform boost at Raymond James. Angie’s List (ANGI) is downgraded to Hold from Buy at Canaccord. Ericsson (ERIC) is moved to Underperform from Neutral at Credit Suisse. KLA-Tencor (KLAC) gets cut to Neutral from Positive at Susquehanna. Yingli Green Energy (YGE) is slashed to Sell from Hold at ThinkEquity.

Big Movers – Ciena (CIEN) down 18.36%, First Solar (FSLR) down 15.74%.
Dow Components – Cisco Systems (CSCO) up 0.21%, Hewlett-Packard (HPQ) up 0.53%, IBM (IBM) up 0.46%, Intel Corp (INTC) down 1.06%, Microsoft (MSFT) up 0.19%.

The Technology Select Sector SPDR (XLK) was trading at $30.36 at 3:30 PM on Thursday, down 0.75% on the day – up 19.29% year-to-date.

Telecommunication Services

Dow Components – AT&T (T) up 0.87%, Verizon (VZ) up 1.36%. The NASDAQ Telecommunications Index (IXTC) was trading at $195.27 at 3:30 PM on Thursday, down 1.18% on the day – down 0.84% year-to-date.

Utilities

Calpine (CPN) is upgraded to Overweight from Equal Weight by Barclays. Dominion Resources (D) down 1.54%, Edison International (EIX) up 0.87%, First Energy (FE) down 0.83%, PG&E Corp (PCG) down 0.30%, Southern Company (SO) down 0.31%.

The Utilities Select Sector SPDR (XLU) was trading at $36.47 at 3:30 PM on Thursday, down 0.27% on the day – up 1.36% year-to-date.

STOCKS: CVX, XOM, AA, DD, BA, CAT, GE, MMM, UTX, DIS, HD, MCD, KFT, KO, PG, WMT, JNJ, MRK, PFE, AXP, BAC, JPM, TRV, CSCO, HPQ, IBM, INTC, MSFT, T, VZ, D, EIX, FE, PCG, SO, MHR, NRP, QRE, FRO, NXY, OILT, LYB, SHLD, CG, DD, LPX, AAMRQ, JPM, LCC, CWST, FLOW, EFX, VOLVY, VC, PIR, P, OXM, CWTR, VRA, KGFHY, WWE, VRA, COST, BRLI, GWAY, AET, CNC, CPHD, GERN, VRTX, CI, CADX, CVH, AET, HUM, GTS, STEM, SRPT, BCS, BNS, ING, MFGLQ, RY, TD, ICE, INTC, CIEN, MEI, TIVO, ADS, BCOV, ANGI, ERIC, KLAC, YGE, CIEN, FSLR

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
CI Cigna Corporation 179.96 2.93 1.66 3,057,657 Trade
MMM 3M Company 176.49 3.65 2.11 3,918,853 Trade
FLOW SPX FLOW Inc. 38.27 0.12 0.31 374,531 Trade
CNC Centene Corporation 53.74 -0.32 -0.59 2,943,179 Trade
PG Procter & Gamble Company (The) 115.89 0.41 0.36 7,644,578 Trade
GE General Electric Company 10.38 0.11 1.07 39,533,151 Trade
CVX Chevron Corporation 124.76 -0.96 -0.76 4,697,588 Trade
ICE Intercontinental Exchange Inc. 91.77 -0.12 -0.13 1,176,832 Trade
SO Southern Company (The) 55.66 -0.45 -0.80 3,127,437 Trade
TD Toronto Dominion Bank (The) 58.66 0.01 0.02 1,046,518 Trade
PCG Pacific Gas & Electric Co. 18.13 0.39 2.20 8,245,907 Trade
CPHD CEPHEID n/a n/a n/a 0 Trade
OXM Oxford Industries Inc. 71.06 1.69 2.44 210,853 Trade
JNJ Johnson & Johnson 132.50 -2.21 -1.64 10,214,538 Trade
CG The Carlyle Group L.P. 23.93 0.16 0.67 462,680 Trade
AA Alcoa Corporation 23.32 0.15 0.65 2,881,522 Trade
INTC Intel Corporation 49.17 -0.95 -1.90 17,131,368 Trade
D Dominion Energy Inc. 77.48 -0.61 -0.78 2,599,174 Trade
TRV The Travelers Companies Inc. 154.59 -0.24 -0.16 877,973 Trade
BCS Barclays PLC 7.80 0.00 0.00 1,243,136 Trade
FVI:CA Fortuna Silver Mines Inc. 4.17 0.54 14.88 1,487,546
BNS Bank Nova Scotia Halifax Pfd 3 53.08 -0.16 -0.30 619,930 Trade
EIX Edison International 70.10 -0.46 -0.65 2,827,148 Trade
AXP American Express Company 128.06 -0.51 -0.40 2,733,988 Trade
UTX United Technologies Corporation 133.19 -0.04 -0.03 3,200,202 Trade
RY Royal Bank of Canada 79.88 -0.01 -0.01 584,971 Trade
HUM Humana Inc. 284.30 -1.02 -0.36 796,970 Trade
SRPT Sarepta Therapeutics Inc. 153.25 -3.66 -2.33 727,589 Trade
VRA Vera Bradley Inc. 11.24 -0.22 -1.92 185,356 Trade
CSCO Cisco Systems Inc. 57.62 -0.43 -0.74 11,501,067 Trade
ERIC Ericsson 9.59 -0.03 -0.31 7,698,119 Trade
LYB LyondellBasell Industries NV Class A (Netherlands) 87.80 1.92 2.24 3,233,091 Trade
COST Costco Wholesale Corporation 280.65 0.07 0.02 1,379,215 Trade
VZ Verizon Communications Inc. 57.41 -0.17 -0.30 10,556,199 Trade
SHLD SHLDQ Sears Holdings Corporation n/a n/a n/a 0
GERN Geron Corporation 1.21 -0.02 -1.63 3,216,347 Trade
BAC Bank of America Corporation 28.99 -0.23 -0.79 54,920,407 Trade
GTS Triple-S Management Corporation Class B 24.63 -0.06 -0.24 47,037 Trade
MCD McDonald's Corporation 213.72 -0.49 -0.23 2,380,836 Trade
YGE Yingli Green Energy Holding Company Limited ADR n/a n/a n/a n/a
CIEN Ciena Corporation 44.36 0.17 0.38 1,780,524 Trade
CWST Casella Waste Systems Inc. 42.01 0.91 2.21 194,467 Trade
FRO Frontline Ltd. 8.32 0.36 4.52 720,854 Trade
PFE Pfizer Inc. 42.85 0.10 0.23 18,551,648 Trade
FSLR First Solar Inc. 64.49 -1.51 -2.29 834,900 Trade
STEM StemCells Inc. n/a n/a n/a n/a
HPQ HP Inc. 21.31 -0.04 -0.19 6,269,016 Trade
KLAC KLA Corporation 122.50 -1.04 -0.84 905,517 Trade
MRK Merck & Company Inc. (new) 81.59 0.63 0.78 8,061,677 Trade
PIR Pier 1 Imports Inc. 5.29 -0.71 -11.83 332,930 Trade
ING ING Group N.V. 11.69 0.04 0.34 1,767,123 Trade
WWE World Wrestling Entertainment Inc. Class A 72.38 -0.74 -1.01 716,048 Trade
FE FirstEnergy Corp. 43.55 -0.31 -0.71 2,200,690 Trade
LPX Louisiana-Pacific Corporation 26.21 0.04 0.15 1,121,237 Trade
KO Coca-Cola Company (The) 52.14 0.01 0.02 7,132,540 Trade
MEI Methode Electronics Inc. 29.13 0.88 3.12 414,621 Trade
T AT&T Inc. 33.58 -0.13 -0.39 17,869,349 Trade
EFX Equifax Inc. 137.42 0.21 0.15 388,403 Trade
CAT Caterpillar Inc. 139.09 -0.55 -0.39 4,051,572 Trade
MHR Magnum Hunter Resources Corp n/a n/a n/a 0
VRTX Vertex Pharmaceuticals Incorporated 176.16 -0.21 -0.12 619,960 Trade
ADS Alliance Data Systems Corporation 150.75 0.73 0.49 620,538 Trade
NRP Natural Resource Partners LP Limited Partnership 33.22 -0.31 -0.92 43,557 Trade
BCOV Brightcove Inc. 11.53 0.11 0.96 200,282 Trade
MSFT Microsoft Corporation 137.08 -1.82 -1.31 22,726,128 Trade
ANGI ANGI Homeservices Inc. 13.53 -0.40 -2.87 953,772 Trade
WMT Walmart Inc. 114.76 -0.22 -0.19 3,488,164 Trade
IBM International Business Machines Corporation 143.53 0.21 0.15 3,474,688 Trade
JPM JP Morgan Chase & Co. 115.12 1.22 1.07 16,944,998 Trade
DIS The Walt Disney Company 144.30 -0.76 -0.52 5,854,707 Trade
HD Home Depot Inc. (The) 217.26 -1.44 -0.66 2,657,421 Trade
XOM Exxon Mobil Corporation 75.93 -1.15 -1.49 10,197,358 Trade
BA The Boeing Company 362.75 1.14 0.32 2,960,425 Trade

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Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     

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