Equities Sector Coverage: Stocks Inch Higher on Housing Boost

Sector Recap  |

Housing Starts rose a less than expected 2.3% to 750,000 units annualized in August. Building Permits fell by 1.0%. Existing Home Sales rose 7.8% in August to an annual rate of 4.82 million, the highest level since May 2010. The Dow Jones Industrial Average traded up to 13,586.35, dipped to 13,556.74 then rallied to 13,626.48 in afternoon trading. The NASDAQ traded up to 3179.33, dipped to 3172.29 then rallied to 3189.35 in afternoon trading.

Asian stocks surged on Wednesday after the Bank of Japan increased their version of quantitative easing. The Nikkei 225 ended the day at 9,232 – up 1.19%. The Hang Seng ended the day at 20,842 – up 1.16%. European exchanges also traded higher on Wednesday. The FTSE 100 ended the day at 5,888 – up 0.35%. The DAX ended the day at 7,391 – up 0.59%. The CAC 40 ended the day at 3,532 – up 0.54%. The yield on the 10-Year US Treasury declined from 1.831% to 1.763% back below the 200-day simple moving average at 1.828%.

Comex gold traded up from $1767.4 the Troy ounce to $1781.8 then down to $1764.2. Nymex crude oil declined from $96.17 per barrel to $91.25, back below its 200-day simple moving average at $96.54. The euro versus the dollar declined from 1.3083 to 1.2996.

Energy

BP (BP) is in sustained negotiations to sell its Texas City refinery to Marathon Petroleum (MPC) for as much as $2.5B. Clean Energy Fuels (CLNE) is a new Hold at KeyBanc Capital. Tidewater (TDW) is an Outperform at Wells Fargo. Golar LNG Partners (GMLP) gets upgraded to Outperform from Market Perform with Wells Fargo. Marathon Oil (MRO) is moved to Outperform from Neutral at Credit Suisse. Dow components – Chevron (CVX) down 0.38%, Exxon Mobil (XOM) down 0.40%. Energy Select Sector SPDR (XLE) was trading at $74.765 at 3:30 PM on Wednesday, down 0.91% on the day – up 8.15% year-to-date.

Materials

ArcelorMittal (MT) is started with a Sell at BTIG. Dow Chemical (DOW), DuPont (DD), PPG Industries (PPG), and Eastman Chemical (EMN) are all Sector Performs at RBC Capital. Outperforms are assigned on LyondellBasell (LYB) and Valspar (VAL). Sherwin-Williams (SHW) is initiated with a Top Pick at RBC Capital. Monsanto (MON) is added to Goldman’s list of Conviction Buys. Royal Gold (RGLD) is now Neutral from Overweight at HSBC Securities. Dow Components – Alcoa (AA) down 0.11%, DuPont (DD) up 0.90%. The Materials Select Sector SPDR (XLB) was trading at $37.885 at 3:30 PM on Wednesday, up 0.60% on the day – up 13.09% year-to-date.

Industrials

AMR (AAMRQ) is sending notices to over 11,000 employees that their jobs might be at risk, although it expects to lay off only around 4,400. Carlisle Cos (CSL) is a new Neutral at Sun Trust. Dover (DOV) is begun with a Buy at Capstone Investments. Chicago Bridge & Iron (CBI) is moved to Neutral from Outperform at Macquarie. Progessive Waste (BIN) is downgraded to Neutral from Overweight at JP Morgan. Kansas City Southern (KSU) is cut to Sell from Neutral at UBS, which gives Neutral-from-Buy reductions to competitors CSX Corp. (CSX), Union Pacific (UNP), and Norfolk Southern (NSC). Waste Management (WM) is downgraded to Underweight from Neutral at JPMorgan.

Big Movers – Excel Maritime Carriers (EXM) is up about 32%. Dow components – Boeing Co (BA) down 0.54%, Caterpillar (CAT) up 0.86%, General Electric (GE) up 0.92%, 3M Company (MMM) up 0.44%, United Technologies (UTX) up 0.14%. The Industrial Select Sector SPDR (XLI) was trading at $37.69 at 3:30 PM on Wednesday, up 0.27% on the day – up 11.67% year-to-date.

Consumer Discretionary

U.S. conglomerate Anschutz said it intends to sell its AEG sports-and-entertainment unit, which could reportedly fetch several billion dollars. Potential buyers could include News Corp. (NWS) and Liberty Media (LMCA), the owner of a 21% stake in AEG ticket rival Live Nation (LYV). Despite Green Mountain's (GMCR) travails, CEO Larry Blanford has given an upbeat interview to the WSJ, pointing out that while sales growth is falling, it's still going to be 15%-20%, which few other companies in GMCR's sector achieve. Blanford's also not worried about Starbucks' (SBUX) single-serve brewing machines, as they're espresso products while GMCR's are for filtered coffee. Amazon (AMZN) is set for another win in the e-book wars after Apple (AAPL) and four major publishers offered to allow retailers to sell the books at discounts for two years in order to end an EU antitrust probe. The publishers include CBS's (CBS) Simon & Schuster and News Corp's (NWS) HarperCollins. Retailers appear to be optimistic about the Christmas holiday season despite the gloom in other sectors because of the global economy. Department store Kohl's (KSS) expects to add 10%. AutoZone (AZO) beat estimates by 6 cents on revenue of $2.8B. Ascena Retail (ASNA) beat estimates by 2 cents and revenue by $140M. Cracker Barrel (CBRL) missed estimates by 10 cents, while beating revenue by $15M. Vera Bradley (VRA) is upgraded to Overweight from Neutral at JPMorgan. Bed Bath & Beyond (BBBY) is cut to Market Perform from Outperform at Oppenheimer. Bon-Ton Stores (BONT) is moved to Underperform from Neutral at Credit Suisse. Hasbro (HAS) and Mattel (MAT) are each Hold from Buy at Needham.
Dow Components – Disney (DIS) up 1.46%, Home Depot (HD) up 1.33%, McDonalds (MCD) up 0.05%. The Consumer Discretionary Select Sector SPDR (XLY) was trading at $47.885 at 3:30 PM on Wednesday, up 1.24% on the day – up 22.72% year-to-date.

Consumer Staples

Despite Green Mountain's (GMCR) travails, CEO Larry Blanford has given an upbeat interview to the WSJ, pointing out that while sales growth is falling, it's still going to be 15%-20%, which few other companies in GMCR's sector achieve. Blanford's also not worried about Starbucks' (SBUX) single-serve brewing machines, as they're espresso products while GMCR's are for filtered coffee. General Mills (GIS) beat estimates by 3 cents with revenue in-line with estimates. Chiquita Brands (CQB) and Fresh Del Monte (FDP) are both hoisted to Buy from Hold at BB&T Capital. PriceSmart (PSMT) is downgraded to Neutral from Buy at Janney Capital. Dow components – Coca Cola (KO) unchanged, Procter & Gamble (PG) up 0.30%, Wal-Mart (WMT) up 0.80%. The Consumer Staples Select Sector SPDR (XLP) was trading at $36.23 at 3:30 PM on Wednesday, up 0.42% on the day – up 11.51% year-to-date.

Health Care

Illumina (ILMN) CEO Jay Flatley has told Bloomberg that while the fiscal cliff will affect a third of the gene-sequencing company's customers, "it's going to probably be pretty short-lived." Achillion Pharmaceuticals (ACHN) is begun with a Buy at Deutsche Bank. Allergan (AGN) is a Hold at Canaccord. Baxter International (BAX) is a new Outperform at BMO Capital Markets. Achillion Pharmaceuticals (ACHN) gets a Buy-from-Neutral boost at Bank of America-Merrill Lynch. AstraZeneca (AZN) is now Neutral from Underperform by BNP Paribas. St. Jude Medical (STJ) gets moved to Outperform from Market Perform with Wells Fargo. GlaxoSmithKline (GSK) gets downgraded to Underperform from Outperform by BNP Paribas. Idenix Pharmaceuticals (IDIX) is lowered to Neutral from Buy at Bank of America-Merrill Lynch.
Big Movers – Achillion Pharmaceuticals (ACHN) is up about 15%, Questcor Pharmaceuticals (QCOR) is down about 40%, Idenix Pharmaceuticals (IDIX) is down about 11%. Dow Components – Johnson & Johnson (JNJ) up 0.44%, Merck (MRK) up 1.27%, Pfizer (PFE) up 1.27%, United Health Group down 0.02%. The Health Care Select Sector SPDR (XLV) was trading at $40.15 at 3:30 PM on Wednesday, up 0.30% on the day – up 15.74% year-to-date.

Financial

Blackstone (BX) has agreed to acquire Vivint for $2B from initial investors Goldman Sachs (GS), Jupiter and Peterson, Vivint CEO Todd Pedersen has told Bloomberg, confirming earlier speculation. Goldman Sachs (GS) has named Harvey Schwartz, the global co-head of its securities arm, as its next CFO. Schwartz will replace David Viniar, who is retiring at the end of January after a 12-year stint. Progressive (PGR) is upgraded to Equal Weight from Underweight at Evercore. Webster Financial (WBS) is raised to Strong Buy from Outperform at Raymond James. BB&T Corp. (BBT) is cut to Market Perform from Outperform by Sanford Bernstein. Charles Schwab (SCHW) is cut to Neutral from Buy at Goldman. Northern Trust (NTRS) is now Underperform from Neutral at Credit Suisse. Dow Components – American Express (AXP) up 0.28%, Bank of America (BAC) up 0.81%, JP Morgan Chase (JPM) up 0.30%, Travelers (TRV) up 0.09%. The Financial Select Sector SPDR (XLF) was trading at $16.07 at 3:30 PM on Wednesday, up 0.12% on the day – up 23.62% year-to-date.

Information Technology

Amazon (AMZN) is set for another win in the e-book wars after Apple (AAPL) and four major publishers offered to allow retailers to sell the books at discounts for two years in order to end an EU antitrust probe. The publishers include CBS's (CBS) Simon & Schuster and News Corp's (NWS) HarperCollins. The first iPhone 5 (AAPL) reviews are out and they mostly gush with praise. ASML Holding (ASML) is initiated with an Overweight at JPMorgan. Corning (GLW) gets a Buy-from-Neutral boost at Goldman Sachs. Broadcom (BRCM) is moved to Market Perform from Outperform at Wells Fargo. Lam Research (LRCX) is now Neutral from Buy at Citigroup. Dow Components – Cisco Systems (CSCO) down 0.50%, Hewlett-Packard (HPQ) down 0.77%, IBM (IBM) down 0.09%, Intel Corp (INTC) down 0.09%, Microsoft (MSFT) down 0.11%. The Technology Select Sector SPDR (XLK) was trading at $31.715 at 3:30 PM on Wednesday, up 0.27% on the day – up 24.62% year-to-date.

Telecommunication Services

Dow Components – AT&T (T) up 0.41%, Verizon (VZ) up 0.67%. The NASDAQ Telecommunications Index (IXTC) was trading at $200.68 at 3:30 PM on Wednesday, up 0.32% on the day – up 1.90% year-to-date.

Utilities

The Big Names – Dominion Resources (D) down 0.04%, Edison International (EIX) up 0.09%, First Energy (FE) up 0.46%, PG&E Corp (PCG) up 0.20%, Southern Company (SO) up 0.21%. The Utilities Select Sector SPDR (XLU) was trading at $36.283 at 3:30 PM on Wednesday, up 0.23% on the day – up 0.84% 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, BP, MPC, CLNE, TDW, GMLP, MRO, MT, DOW, DD, PPG, EMN, LYB, VAL, SHW, MON, RGLD, AAMRQ, CSL, DOV, CBI, BIN, KSU, CSX, UNP, NSC, WM, EXM, NWS, LMCA, LYV, GMCR, SBUX, AMZN, AAPL, CBS, NWS, KSS, AZO, ASNA, CBRL, VRA, BBBY, BONT, HAS, MAT, GMCR, SBUX, GIS, CQB, FDP, PSMT, ILMN, ACHN, AGN, BAX, ACHN, AZN, STJ, GSK, IDIX, ACHN, QCOR, IDIX, BX, GS, GS, PGR, WBS, BBT, SCHW, NTRS, AMZN, AAPL, CBS, NWS, AAPL, ASML, GLW, BRCM, LRCX

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
CBS VIAC ViacomCBS n/a n/a n/a 0 Trade
MMM 3M Company 175.63 -2.52 -1.41 4,361,414 Trade
GLW Corning Incorporated 28.56 -0.80 -2.72 6,832,317 Trade
WBS Webster Financial Corporation 47.10 -1.80 -3.68 647,610 Trade
GSK GlaxoSmithKline PLC 46.48 -0.75 -1.59 3,583,168 Trade
ASML ASML Holding N.V. 284.28 -11.55 -3.90 889,254 Trade
SHW Sherwin-Williams Company (The) 584.27 -10.57 -1.78 411,115 Trade
TDW Tidewater Inc. 16.01 -0.11 -0.68 137,429 Trade
PG Procter & Gamble Company (The) 125.69 0.55 0.44 9,338,515 Trade
GE General Electric Company 11.44 -0.27 -2.31 47,862,566 Trade
ASNA Ascena Retail Group Inc. 5.15 -0.58 -10.12 222,102 Trade
CVX Chevron Corporation 110.39 -1.46 -1.31 7,609,831 Trade
SO Southern Company (The) 69.74 0.30 0.43 4,412,299 Trade
WM Waste Management Inc. 121.19 0.19 0.16 1,191,235 Trade
PCG Pacific Gas & Electric Co. 14.04 -0.23 -1.61 8,289,862 Trade
BAX Baxter International Inc. 90.53 -0.25 -0.28 2,222,430 Trade
AZO AutoZone Inc. 1,114.49 -25.74 -2.26 211,958 Trade
LYV Live Nation Entertainment Inc. 70.90 -1.12 -1.56 1,264,292 Trade
JNJ Johnson & Johnson 148.75 0.43 0.29 7,587,103 Trade
PPG PPG Industries Inc. 122.96 -2.85 -2.27 1,368,775 Trade
AA Alcoa Corporation 14.87 -0.64 -4.13 6,596,079 Trade
CSX CSX Corporation 75.17 -1.53 -1.99 3,677,943 Trade
INTC Intel Corporation 65.69 -2.78 -4.06 30,764,002 Trade
D Dominion Energy Inc. 83.32 -0.68 -0.81 2,225,981 Trade
TRV The Travelers Companies Inc. 133.73 -1.05 -0.78 1,519,509 Trade
BONT Bankers Petroleum Ltd. n/a n/a n/a n/a
MPC Marathon Petroleum Corporation 52.70 -1.79 -3.29 7,797,172 Trade
PSMT PriceSmart Inc. 62.98 0.22 0.35 195,362 Trade
ASBPRC Associated Banc n/a n/a n/a 0 Trade
CSL Carlisle Companies Incorporated 155.20 -1.32 -0.84 440,152 Trade
EIX Edison International 76.21 -0.71 -0.92 1,475,679 Trade
AXP American Express Company 130.64 -4.47 -3.31 6,432,363 Trade
FDP Fresh Del Monte Produce Inc. 32.16 -0.13 -0.40 149,687 Trade
LRCX Lam Research Corporation 293.79 -12.75 -4.16 1,911,264 Trade
UTX United Technologies Corporation 151.03 -2.16 -1.41 4,335,735 Trade
MRO Marathon Oil Corporation 11.69 -0.24 -2.01 16,137,376 Trade
LMCA Liberty Media Corp (DE) n/a n/a n/a 0 Trade
BIN Liberty Media Corp (DE) n/a n/a n/a n/a
VRA Vera Bradley Inc. 10.22 -0.42 -3.95 247,280 Trade
CSCO Cisco Systems Inc. 47.47 -1.38 -2.82 20,665,994 Trade
LYB LyondellBasell Industries NV Class A (Netherlands) 82.11 -2.84 -3.34 3,487,989 Trade
AGN Allergan plc 189.00 0.81 0.43 5,606,117 Trade
GS Goldman Sachs Group Inc. (The) 238.14 -3.78 -1.56 2,506,445 Trade
VZ Verizon Communications Inc. 59.91 -0.37 -0.61 11,482,273 Trade
GMCR Keurig Green Mountain Inc n/a n/a n/a 0 Trade
MAT Mattel Inc. 14.12 -0.16 -1.12 2,367,055 Trade
BBT TFC Truist Financial n/a n/a n/a 0 Trade
BAC Bank of America Corporation 32.85 -0.69 -2.06 57,096,174 Trade
EMN Eastman Chemical Company 69.83 -3.34 -4.56 1,960,371 Trade
ILMN Illumina Inc. 313.92 -5.66 -1.77 859,132 Trade
MCD McDonald's Corporation 209.34 -1.90 -0.90 3,389,321 Trade
KSS Kohl's Corporation 44.68 -0.81 -1.78 2,115,410 Trade
SBUX Starbucks Corporation 88.73 -3.30 -3.59 11,066,487 Trade
BBBY Bed Bath & Beyond Inc. 15.92 -0.43 -2.63 5,301,516 Trade
STJ St. Jude Medical Inc. n/a n/a n/a 0 Trade
ACHN Achillion Pharmaceuticals Inc. 6.76 0.63 10.28 105,653,227 Trade
GIS General Mills Inc. 53.22 -0.49 -0.91 2,547,036 Trade
PFE Pfizer Inc. 40.16 0.34 0.85 30,326,362 Trade
KSU Kansas City Southern 164.08 -2.50 -1.50 993,567 Trade
GMLP Golar LNG Partners LP 7.89 -0.06 -0.75 371,416 Trade
MT Arcelor Mittal NY Registry Shares NEW 14.96 -0.44 -2.86 3,909,777 Trade
HPQ HP Inc. 21.58 -0.40 -1.82 10,554,429 Trade
AZN Astrazeneca PLC 48.90 -0.38 -0.77 2,265,598 Trade
MRK Merck & Company Inc. (new) 86.10 0.12 0.14 10,350,735 Trade
NTRS Northern Trust Corporation 98.46 -3.16 -3.11 1,305,593 Trade
BP BP p.l.c. 37.44 -0.69 -1.81 7,945,776 Trade
FE FirstEnergy Corp. 50.26 -0.21 -0.42 2,646,999 Trade
BRCM Broadcom Corp. n/a n/a n/a 0 Trade
HAS Hasbro Inc. 103.64 -1.04 -0.99 931,459 Trade
PGR Progressive Corporation (The) 75.77 -0.98 -1.28 2,490,018 Trade
CBRL Cracker Barrel Old Country Store Inc. 156.14 -1.63 -1.03 229,047 Trade
KO Coca-Cola Company (The) 57.48 -0.20 -0.35 14,359,938 Trade
T AT&T Inc. 38.25 -0.25 -0.65 35,221,574 Trade
CAT Caterpillar Inc. 135.73 -4.65 -3.31 2,920,525 Trade
SCHW Charles Schwab Corporation (The) 45.76 -1.39 -2.95 9,537,889 Trade
DOV Dover Corporation 115.43 -1.68 -1.43 909,535 Trade
UNP Union Pacific Corporation 178.47 -7.21 -3.88 4,184,125 Trade
MSFT Microsoft Corporation 162.28 -2.76 -1.67 32,078,067 Trade
CLNE Clean Energy Fuels Corp. 2.35 -0.08 -3.29 540,254 Trade
NWS News Corporation 14.10 -0.25 -1.71 639,157 Trade
RGLD Royal Gold Inc. 114.18 -0.68 -0.59 484,417 Trade
WMT Walmart Inc. 115.86 1.49 1.30 7,018,406 Trade
IBM International Business Machines Corporation 138.62 -1.94 -1.38 4,166,562 Trade
AAPL Apple Inc. 308.95 -9.36 -2.94 40,485,005 Trade
JPM JP Morgan Chase & Co. 132.03 -1.12 -0.84 12,860,456 Trade
AMZN Amazon.com Inc. 1,828.34 -33.30 -1.79 3,528,509 Trade
DIS The Walt Disney Company 135.90 -4.18 -2.98 12,831,818 Trade
HD Home Depot Inc. (The) 231.19 -0.81 -0.35 3,595,928 Trade
XOM Exxon Mobil Corporation 64.74 -1.58 -2.38 21,231,010 Trade
BA The Boeing Company 316.60 -6.45 -2.00 7,468,146 Trade

Comments

Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     
BA

     
WMT

     
DIS

     
GOOG

     
XOM

     
BRK.A

     
FB

     
JNJ

     
WFC

     
T

     
NFLX

     
TSLA

     
V

     
UNH

     
PG

     

World Economic Forum at Davos 2019 - Ben Yablon Executive VP Salt Lending

Matt Bird sits down with Ben Yablon - Executive VP of Salt Lending - at the World Economic Forum in Davos January 2019