Companies continue to make massive bets on the fast-growing market for natural gas, with Kinder Morgan (KMI) announcing a blockbuster deal to buy fellow pipeline company El Paso (EP) for $21B ($26.87 / share – a 37% premium) in cash and shares, or over $38B including debt. Anadarko has reached a deal to pay BP (BP) $4B for its share of the clean-up costs of the Gulf of Mexico oil spill, with both companies agreeing to mutually release claims against each other. Not wanting to miss out on the U.S. energy party, Norway's Statoil (STO) has agreed to buy the outstanding shares in oil firm Brigham Exploration (BEXP) for $4.4B ($36.50 / share – a 20% premium). Halliburton (HAL) beat estimates by 2 cents and revenue by $160M. Raymond James raises Noble Corp (NE) and Transocean (RIG) to Strong Buy from Outperform. Cimarex (XEC) gets lowered to Neutral from Buy at Lazard. In afternoon trading: Shares of El Paso are up about 24.5%. Shares of Brigham Exploration are up about 20%. Shares of General Maritime (GMR) are down about 14.25%. Shares of Patriot Coal (PCX) are down about 10.5%.
Energy Select Sector SPDR (XLE) was trading at $65.73 at 4:00 PM on Monday, down 1.31% on the day – down 3.69% year-to-date.
Rio Tinto (RIO) plans to sell or spin off an estimated $8B worth of aluminum assets across six countries in a move seen as enabling it to increase its focus on iron ore, which accounts for nearly 80% of earnings and generates margins of 70%. LyondellBasell (LYB) is launched with a Buy at Deutsche Bank. Vulcan Materials (VMC) is now Neutral from Sell at Goldman. PPG Industries (PPG) gets upgraded to Positive from Neutral at Susquehanna. Alcoa (AA) is downgraded to Underperform from Market Perform at First Global. In afternoon trading: Shares of Cemex (CX) are down about 11%. Shares of Vale SA (VALE) are down about 8.5%. Shares of Walter Energy (WLT) are down about 8%.
The Materials Select Sector SPDR (XLB) was trading at $32.56 at 4:00 PM on Monday, down 2.75% on the day – down 15.23% year-to-date.
It's not in the U.S. oil or gas industry, but U.K. Security services firm G4S (GFSZY) has also announced a major acquisition, saying it is to buy Danish outsourcer ISS for £5.2B ($8.2B) in cash and shares. Philips (PHG) is to cut 4,500 jobs as part of a plan to save €800M in costs. The move comes after Q3 2011 net profit collapsed 85% to €76M, although this did beat forecasts. Revenue slipped a less dramatic 1.2% to €5.39B and also topped expectations. Caterpillar (CAT) is boosted to Buy from Neutral at Goldman Sachs. Jefferies takes Timken (TKR), Parker-Hannifin (PH), Joy Global (JOYG), Eaton (ETN), Cummins (CMI), and CNH Global (CHH) all up to Buy from Hold. Navistar (NAV) is now Sell from Neutral at Goldman. In afternoon trading: Shares of Manitowoc (MTW) are down about 9.75%.
The Industrial Select Sector SPDR (XLI) was trading at $31.44 at 4:00 PM on Monday, down 2.33% on the day – down 9.84% year-to-date.
Citigroup (C) could halt its sale of EMI after second-round bids for all or part of the record company came in at the low end of an expected range of $3B-$4B. Bidders include BMG Music (KKR), Sony/ATV (SNE), Vivendi's Universal Music (VIVHY) and Warner. Following setbacks at three large Ford (F) plants last week, the automaker's tentative contract with the UAW now looks poised for authorization after two major union locals gave the deal their overwhelming support. Hasbro (HAS) missed estimates by 3 cents and revenue by $70M. Tiffany & Co (TIF) is begun with a Buy and $90 price objective at Sterne Agee. Family Dollar (FDO) is increased to Overweight from Equal Weight by Barclays. WPP Group plc (WPPGY) gets hoisted to Buy from Hold at the Royal Bank of Scotland. Compass Group (CMPGY) is now Outperform from Neutral at Exane BNP Paribas. Dollar Tree (DLTR) is now Equal Weight from Overweight at Barclays. Sterne Agee reduces ratings on Columbia Sportswear (COLM), Dick’s Sporting Goods (DKS), and K-Swiss (KSWS) to Underperform from Neutral. It also cuts Hibbett Sports (HIBB), Kenneth Cole Productions (KCP), Shoe Carnival (SCVL) and Wolverine World Wide (WWW) to Neutral from Buy. Interpublic Group (IPG) is cut to Hold at Deutsche Bank.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $38.11 at 4:00 PM on Monday, down 1.45% on the day – up 1.87% year-to-date.
Archer-Daniels (ADM) gets picked up with a Hold at Argus. Procter & Gamble (PG) is upgraded to Outperform from Market Perform at BMO Capital. In afternoon trading: Shares of AgFeed (FEED) are down about 11%. Shares of Green Mountain Coffee Roasters (GMCR) are down about 10.75%. Shares of Coffee Holding (JVA) are down about 6.75%. Shares of Pilgrim’s Pride (PPC) are down about 6.25%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $30.68 at 4:00 PM on Monday, down 0.62% on the day – up 4.67% year-to-date.
In afternoon trading: Shares of Anadys Pharmaceuticals (ANDS) are up about 250% after agreeing to be acquired by Roche (RHHBY) for $3.70 / share in cash (a 256% premium). Shares of Inhibitex (INHX) are up about 9.5%. Shares of Avanir Pharmaceuticals (AVNR) are down about 9.25%. Shares of Five Star Quality Care (FVE) are down about 9.25%. Shares of Skilled Healthcare (SKH) are down about 8.75%. Shares of Optimer Pharmaceuticals (OPTR) are down about 8.5%. Shares of Vertex Pharmaceuticals (VRTX) are down about 8.5%. Shares of Pacific Biosciences (PACB) are down about 8.5%. Shares of Depomed (DEPO) are down about 8%.
The Health Care Select Sector SPDR (XLV) was trading at $32.41 at 4:00 PM on Monday, down 1.43% on the day – up 2.89% year-to-date.
Citigroup (C) could halt its sale of EMI after second-round bids for all or part of the record company came in at the low end of an expected range of $3B-$4B. Bidders include BMG Music (KKR), Sony/ATV (SNE), Vivendi's Universal Music (VIVHY) and Warner. First Horizon National (FHN) missed estimates by 2 cents, but beat revenue by $38M. Citigroup (C) reported 3Q earnings of 84 Cents / share, topping estimates. Aviva (AV) is upgraded to Buy from Neutral at UBS. EastGroup (EGP) is moved to Buy from Neutral at Janney Montgomery Scott. American Capital Agency (AGNC) is moved to Market Perform from Outperform at JMP Securities. In afternoon trading: Shares of Wells Fargo (WFC) are down about 8%.
The Financial Select Sector SPDR (XLF) was trading at $12.28 at 4:00 PM on Monday, down 2.54% on the day – down 23.01% year-to-date.
IBM (IBM) is expected to announce that Q3 EPS rose to $3.21 from $2.82 when it reports earnings after the bell today, with revenue forecast to have increased to $26.11B from $24.27B. Apple (AAPL) is taken to Hold from Buy at BGC Financial. Veeco Instruments (VECO) is lowered to Sell from Hold at Canaccord Genuity. In afternoon trading: Shares of Shanda Interactive Entertainment (SNDA) are up about 18%. Shares of Energy Conversion Devices (ENER) are down about 14.5%. Shares of Motricity (MOTR) are down about 11.5%. Shares of Rubicon Technology (RBCN) are down about 11.25%. Shares of Veeco Instruments are down about 11%. Shares of Cree Inc. (CREE) are down about 10.5%.
The Technology Select Sector SPDR (XLK) was trading at $25.64 at 4:00 PM on Monday, down 1.38% on the day – up 1.79% year-to-date.
Citigroup (C) could halt its sale of EMI after second-round bids for all or part of the record company came in at the low end of an expected range of $3B-$4B. Bidders include BMG Music (KKR), Sony/ATV (SNE), Vivendi's Universal Music (VIVHY) and Warner. In afternoon trading: Shares of Clearwire (CLWR) are down about 12.5%. Shares of Level 3 Communications (LVLT) are down about 5.5%. Shares of TerreStar (TSTRQ) are down about 5.25%. Actives: Shares of Sprint Nextel (S) are up slightly, while shares of AT&T (T) are down about 0.3% and shares of Verizon (VZ) are down about 1.1%.
The NASDAQ Telecommunications Index (IXTC) was trading at $194.46 at 4:00 PM on Monday, down 2.41% on the day – down 13.72% year-to-date.
In afternoon trading: Actives: Shares of Duke Energy (DUK) are up about 0.9%. Shares of Genon Energy (GEN) are down about 1.1%. Shares of NiSource (NI) are up about 1.7%. Shares of AES Corp. (AES) are down about 2.5%. Shares of CenterPoint Energy (CNP) are up about 0.75%. Shares of PPL Corp. (PPL) are down about a quarter of a percent. Shares of Southern Co. (SO) are up about a half of a percent. Shares of Exelon (EXC) are down about 1.1%.
The Utilities Select Sector SPDR (XLU) was trading at $33.91 at 4:00 PM on Monday, down 0.21% on the day – up 8.20% year-to-date.
STOCKS: KMI, EP, BP, STO, BEXP, HAL, NE, RIG, XEC, GMR, PCX, RIO, LYB, VMC, PPG, AA, CX, VALE, WLT, GFSZY, PHG, CAT, TKR, PH, JOYG, ETN, CMI, CHH, NAV, MTW, C, KKR, SNE, VIVHY, F, HAS, TIF, FDO, WPPGY, CMPGY, DLTR, COLM, DKS, KSWS, HIBB, KCP, SCVL, WWW, IPG, ADM, PG, FEED, GMCR, JVA, PPC, ANDS, RHHBY, INHX, AVNR, FVE, SKH, OPTR, VRTX, PACB, DEPO, FHN, AV, EGP, AGNC, WFC, IBM, AAPL, VECO, SNDA, ENER, MOTR, RBCN, CREE, CLWR, LVLT, TSTRQ, S, T, VZ, DUK, GEN, NI, AES, CNP, PPL, SO, EXC
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