Equities Sector Coverage: Stocks Pare Gains But Still Closer Higher

Sector Recap |

Energy

Chevron (CVX) expects Q3 results to beat analyst forecasts and come in at the same level as Q2, when it reported EPS of $3.85. Energy Transfer Partners (ETP) is increased to Outperform from Perform with a $47.75 target at Morgan Keegan. Boardwalk Pipeline Partners (BWP) is also upgraded to Outperform from Perform at Morgan Keegan. Patriot Coal (PCX) gets cut to Sell from Neutral at Goldman. First Solar (FSLR) is taken to Sell from Neutral at Ticonderoga. In afternoon trading: Shares of General Maritime (GMR) are up about 51.5%. Shares of Frontline (FRO) are up about 17.25%. Shares of Cal Dive International (DVR) are up about 13.5%. Shares of W&T Offshore (WTI) are up about 12.25%.

Energy Select Sector SPDR (XLE) was trading at $64.13 at 4:00 PM on Wednesday, up 0.53% on the day – down 6.04% year-to-date.

Materials

Alcoa (AA) got the Q3 earnings season off to a poor start after reporting that EPS more than doubled to $0.15 but came in way below reduced expectations of $0.23. Revenue jumped 21% to $6.4B and beat forecasts. In afternoon trading: Shares of Cemex (CX) are up about 18%. Shares of Aluminum of China (ACH) are up about 12%. Shares of Rare Element (REE) are up about 8.25%. Shares of Mechel (MTL) are up about 7.5%. Shares of Louisiana-Pacific (LPX) are up about 7.25%.

The Materials Select Sector SPDR (XLB) was trading at $32.79 at 4:00 PM on Wednesday, up 0.99% on the day – down 14.63% year-to-date.

Industrials

Acuity Brands (AYI) is a new Hold and $38 target price at Jefferies. Norfolk Southern (NSC) and C.H. Robinson (CHRW) are now Hold from Buy at Deutsche Bank. In afternoon trading: Shares of A123 Systems (AONE) are up about 21.75%. Shares of Excel Maritime (EXM) are up about 17%. Shares of Paragon Shipping (PRGN) are up about 16.25%. Shares of WABCO (WBC) are up about 7.5%. Shares of DryShips (DRYS) are up about 7.5%. Shares of US Airways (LCC) are up about 7.5%.

The Industrial Select Sector SPDR (XLI) was trading at $31.89 at 4:00 PM on Wednesday, up 1.27% on the day – down 8.55% year-to-date.

Consumer Discretionary

AMC Networks (AMCX) is a new Underweight at Morgan Stanley. Cheesecake Factory (CAKE) is started with a Sell at Goldman Sachs, which has new Neutrals on DineEquity (DIN), Brinker International (EAT), and PF Chang’s (PFCB). Priceline.com (PCLN) is begun with a Buy and $580 price objective at Jefferies. In afternoon trading: Shares of Liz Claiborne (LIZ) is up about 32.5% after the company agreed to sell its Liz Claiborne, Monet and Kensie fashion brands for $328 million in cash, allowing the cash-strapped apparel maker to reduce its debt. Shares of Hovnanian (HOV) are up about 10%. Shares of Beazer Homes (BZH) are up about 9.5%. Shares of Eastman Kodak (EK) are down about 9%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $38.08 at 4:00 PM on Wednesday, up 0.90% on the day – up 1.79% year-to-date.

Consumer Staples

Bank of America-Merrill Lynch launches Buys on Altria (MO) and Philip Morris (PM) and assigns new Neutrals on Reynolds American (RAI) and Lorillard (LO). Carrefour SA (CRRFY) is cut Neutral from Buy at JP Morgan. In afternoon trading: Shares of AgFeed (FEED) are up about 17.75%. Shares of Zhongpin (HOGS) are up about 14.5%. Shares of Farmer Brothers (FARM) are up about 7.75%. Shares of Imperial Sugar (IPSU) are up about 7.25%. Shares of Coffee Holding (JVA) are down about 8%. Shares of Diamond Foods (DMND) are down about 6.5%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $30.72 at 4:00 PM on Wednesday, down 0.79% on the day – up 4.81% year-to-date.

Healthcare

TE Connectivity (TEL) will replace Cephalon (CEPH) in the S&P 500 index after the close of trading on Friday. Cephalon is being acquired by Teva (TEVA) in a deal expected to be completed within the next few days. Align Technology (ALGN) is a new Neutral at Credit Suisse. Humana (HUM) and HealthSpring (HS) are each upgraded to Outperform from Perform at Oppenheimer, with respective increased price objectives of $87 and $45. WebMD Health (WBMD) is downgraded to Neutral from Buy at Goldman. In afternoon trading: Shares of Pacific Biosciences (PACB) are up about 28.25%. Shares of Gentiva Health Services (GTIV) are up about 16.25%. Shares of Metabolix (MBLX) are up about 13%.

The Health Care Select Sector SPDR (XLV) was trading at $32.60 at 4:00 PM on Wednesday, up slightly on the day – up 3.49% year-to-date.



Financials

Private-equity firm Bain Capital is in final negotiations to buy Japanese restaurant chain Skylark from Nomura (NMR) for up to ¥260B ($3.4B), including debt. Bank of America-Merrill Lynch has new Neutrals on SunTrust Banks (STI) and BB&T Corp (BBT). It begins Buys on U.S. Bancorp (USB), PNC Financial Services (PNC), and Wells Fargo (WFC). First Republic Bank (FRC) is initiated with a Buy at Cantor Fitzgerald. BNP Paribas (BNPQY) is upgraded to Buy from Hold at Societe Generale. Lloyds Banking (LYG) is lowered to Hold from Buy at Canaccord Genuity. Commerzbank AG (CRZBY) and Credit Agricole SA (CRARY) are both now Hold from Buy at Societe Generale, which cuts Natixis (NTXFF) by 180 degrees, to Sell from Buy. Waddell & Reed (WDR) is downgraded to Hold from Buy at Jefferies. Cullen/Frost Bankers (CFR) is cut to Underperform from Neutral at Sterne Agee.

The Financial Select Sector SPDR (XLF) was trading at $12.75 at 4:00 PM on Wednesday, up 2.53% on the day – down 20.09% year-to-date.

Information Technology

Hewlett Packard (HPQ) is reconsidering its plan to spin off or sell its PC arm, as new analyses show that the costs could outweigh the benefits. Matters continue to deteriorate for RIM (RIMM) as disruptions to its Blackberry service extend into a third day and spread further into Asia, having mainly affected Europe and Latin America until now. UPDATE: "BlackBerry subscribers in the Americas may be experiencing intermittent service delays this morning," RIM said in a statement. Samsung (SSNLF) says it will soon release amended versions of three Galaxy smartphones to bypass temporary sales bans in some European nations on handsets that violated an Apple (AAPL) patent. TE Connectivity (TEL) will replace Cephalon (CEPH) in the S&P 500 index after the close of trading on Friday. Cephalon is being acquired by Teva (TEVA) in a deal expected to be completed within the next few days. RBC Capital resumes Outperforms on Dow member Intel (INTC), along with Analog Devices (ADI), Cypress Semiconductor (CY), Marvell Technology (MRVL), and Texas Instruments (TXN). It starts Sector Perfoms on Altera (ALTR), Broadcom (BRCM), and Freescale (FSL), and names Sandisk (SNDK) a Top Pick. GT Advanced Technologies (GTAT) gets picked up at an Underperform at Jefferies. IAC/InterActiveCorp (IACI) is upgraded to Buy from Neutral at Goldman Sachs. Nokia (NOK) is moved to Neutral from Reduce at Nomura, but is now Sell from Neutral at WestLB. Xerox (XRX), Lexmark (LXK), and Brocade (BRCD) are each downgraded to Underweight from Neutral at JP Morgan, which takes Seagate Technology (STX) to Neutral from Overweight. Rackspace (RAX) is reduced to Hold from Buy at The Benchmark Company with a new target of $42. WebMD Health (WBMD) is downgraded to Neutral from Buy at Goldman. In afternoon trading: Shares of Broadsoft (BSFT) are up about 12%. Shares of Giant Interactive Group (GA) are up about 12%.

The Technology Select Sector SPDR (XLK) was trading at $25.27 at 4:00 PM on Wednesday, up 0.44% on the day – up 0.32% year-to-date.

Telecommunications Services

In afternoon trading: Actives: Shares of Sprint Nextel (S) are up about 8%. Shares of TerreStar (TSTRQ) are up about 7.5%. Shares of Clearwire (CLWR) are up about 7%. Shares of Telecom Italia (TI) are up about 5.8%. Shares of Premiere Global Services (PGI) are up about 5.4%. Shares of Turkcell (TKC) are up about 5.2%. Shares of NII Holdings (NIHD) are up about 5.1%. Shares of magicJack VocalTec (CALL) are down about 5.75%.

The NASDAQ Telecommunications Index (IXTC) was trading at $193.47 at 4:00 PM on Wednesday, up 0.83% on the day – down 14.15% year-to-date.

Utilities

Calpine (CPN) is initiated with a Buy at ISI Group, which has a Hold on rival Dynegy (DYN). In afternoon trading: Actives: Shares of Duke Energy (DUK) are down about a quarter of a percent. Shares of CenterPoint Energy (CNP) are down about 0.4%. Shares of Exelon (EXC) are up about 1.5%. Shares of PPL Corp (PPL) are up about 0.4%. Shares of Genon Energy (GEN) are up about 0.7%. Shares of AES Corp (AES) are up about 2.6%. Shares of NV Energy (NVE) are up about 1.1%.

The Utilities Select Sector SPDR (XLU) was trading at $33.66 at 4:00 PM on Wednesday, down 0.24% on the day – up 7.40% year-to-date.

STOCKS: CVX, ETP, BWP, PCX, FSLR, GMR, FRO, DVR, WTI, AA, CX, ACH, REE, MTL, LPX, AYI, NSC, CHRW, AONE, EXM, PRGN, WBC, DRYS, LCC, AMCX, CAKE, DIN, EAT, PFCB, PCLN, LIZ, HOV, BZH, EK, MO, PM, RAI, LO, CRRFY, FEED, HOGS, FARM, IPSU, JVA, DMND, TEL, CEPH, TEVA, ALGN, HUM, HS, WBMD, PACB, GTIV, MBLX, NMR, STI, BBT, USB, PNC, WFC, FRC, BNPQY, LYG, CRZBY, CRARY, NTXFF, WDR, CFR, HPQ, RIMM, SSNLF, AAPL, INTC, ADI, CY, MRVL, TXN, ALTR, BRCM, FSL, SNDK, GTAT, IACI, NOK, XRX, LXK, BRCD, STX, RAX, BSFT, GA, S, TSTRQ, CLWR, TI, PGI, TKC, NIHD, CALL, CPN, DYN, DUK, CNP, EXC, PPL, GEN, AES, NVE

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
REE Rare Element Resources n/a n/a n/a n/a
AYI Acuity Brands Inc (Holding Company) 206.15 -4.47 -2.12 946,732
WDR Waddell & Reed Financial Inc. 18.77 0.32 1.73 1,593,115
RAI Reynolds American Inc 58.00 0.32 0.55 25,969,505
GEN Genesis Healthcare Inc. 4.34 -0.02 -0.46 93,178
FARM Farmer Brothers Company 33.75 -0.25 -0.74 22,432
BRCD Brocade Communications Systems Inc. 12.47 0.00 0.00 5,048,142
ACH Aluminum Corporation of China Limited American Dep 11.22 -0.16 -1.41 62,978
CVX Chevron Corporation 115.94 -0.34 -0.29 4,855,334
BWP Boardwalk Pipeline Partners LP 18.13 -0.07 -0.38 627,893
TI Telecom Italia S.P.A. New 8.81 -0.19 -2.11 82,451
VNDKD VendTek Systems Inc n/a n/a n/a 0
DRYS DryShips Inc. 1.59 -0.03 -1.85 28,788,020
BSFT BroadSoft Inc. 42.85 -0.25 -0.58 410,731
AA Alcoa Inc. 34.81 2.17 6.65 6,421,628
MBLX Metabolix Inc. n/a n/a n/a n/a
INTC Intel Corporation 36.76 -0.04 -0.11 15,390,578
CNP CenterPoint Energy Inc (Holding Co) 25.68 0.19 0.75 2,759,326
PNC PNC Financial Services Group Inc. (The) 116.32 2.39 2.10 3,086,183
CFR Cullen/Frost Bankers Inc. 86.63 0.95 1.11 650,682
MO Altria Group Inc. 69.16 0.68 0.99 8,063,616
AAPL Apple Inc. 119.99 -0.01 -0.01 23,832,047
ADI Analog Devices Inc. 73.01 0.73 1.01 2,107,097
WBMD WebMD Health Corp 50.62 -0.30 -0.59 678,934
S Sprint Corporation 8.73 0.08 0.92 11,496,561
PPL PPL Corp 34.54 -0.15 -0.43 2,218,783
BZH Beazer Homes USA Inc. 13.12 0.15 1.16 618,506
TKC Turkcell Iletisim Hizmetleri AS 6.94 -0.09 -1.28 372,653
PCLN The Priceline Group Inc. 1,541.86 1.73 0.11 246,019
STX Seagate Technology 37.24 0.22 0.59 2,866,839
TXN Texas Instruments Incorporated 74.38 -0.11 -0.15 5,531,370
SNDK SanDisk Corp. n/a n/a n/a 0
HUM Humana Inc. 206.11 2.07 1.01 1,924,734
HOV Hovnanian Enterprises Inc. Class A 2.25 0.09 4.17 2,228,955
MTL Mechel PAO American Depositary Shares (Each rep. 1 6.31 -0.13 -2.02 284,807
PRGN Paragon Shipping Inc n/a n/a n/a 0
AES The AES Corporation 11.93 0.02 0.17 4,558,526
CHRW C.H. Robinson Worldwide Inc. 74.05 0.49 0.67 1,188,694
BBT BB&T Corporation 46.20 0.64 1.40 7,225,686
MRVL Marvell Technology Group Ltd. 14.21 -0.01 -0.07 1,960,280
USB U.S. Bancorp 50.56 0.25 0.50 6,525,369
NOK Nokia Corporation Sponsored American Depositary Sh 4.69 -0.05 -1.05 6,745,508
CPN Calpine Corporation 12.20 -0.21 -1.69 3,722,803
LYG Lloyds Banking Group Plc American Depositary Share 3.25 -0.06 -1.81 5,406,143
JVA Coffee Holding Co. Inc. 4.60 -0.13 -2.75 39,761
LIZ Liz Claiborne Inc. n/a n/a n/a 0
XRX Xerox Corporation 7.02 0.09 1.30 11,953,492
FSL Freescale Semiconductor n/a n/a n/a 0
FRO Frontline Ltd 7.08 0.01 0.14 1,098,702
PM Philip Morris International Inc 93.49 1.13 1.22 5,236,824
ALTR Altera Corp. n/a n/a n/a 0
FSLR First Solar Inc. 34.41 -0.76 -2.16 1,463,465
TEVA Teva Pharmaceutical Industries Limited American De 34.10 0.35 1.04 10,028,589
PGI Premiere Global Services n/a n/a n/a 0
ALGN Align Technology Inc. 94.42 -0.92 -0.96 794,216
DIN DineEquity Inc 74.97 0.76 1.02 206,461
WFC Wells Fargo & Company 54.27 0.49 0.91 21,187,274
CAKE The Cheesecake Factory Incorporated 59.48 -0.11 -0.18 544,278
FRC FIRST REPUBLIC BANK 92.13 0.41 0.45 1,458,673
HPQ HP Inc. 14.58 0.00 0.00 13,671,484
WTI W&T Offshore Inc. 3.18 -0.01 -0.31 1,833,890
PACB Pacific Biosciences of California Inc. 4.81 0.03 0.63 935,187
AMCX AMC Networks Inc. 56.82 0.07 0.12 557,720
BRCM Broadcom Corp. n/a n/a n/a 0
LPX Louisiana-Pacific Corporation 19.18 -0.28 -1.44 1,891,854
CY Cypress Semiconductor Corporation 11.38 -0.05 -0.44 3,700,418
IACI IAC/InterActiveCorp n/a n/a n/a 0
CALL magicJack VocalTec Ltd 8.00 -0.20 -2.44 71,608
EXC Exelon Corporation 35.71 -0.17 -0.47 3,016,309
WBC Wabco Holdings Inc. 105.86 1.65 1.58 351,172
DUK Duke Energy Corporation (Holding Company) 77.50 0.04 0.05 2,235,709
DMND Diamond Foods Inc. n/a n/a n/a 0
TEL TE Connectivity Ltd. New Switzerland Registered Sh 69.82 0.69 1.00 1,130,029
CX Cemex S.A.B. de C.V. Sponsored ADR 8.31 0.02 0.24 13,393,371
NMR Nomura Holdings Inc ADR American Depositary Shares 6.05 0.09 1.51 95,493
RAX Rackspace Hosting Inc n/a n/a n/a 0
LXK Lexmark International Inc. n/a n/a n/a 0
NIHD NII Holdings Inc. 3.00 -0.30 -9.09 361,351
STI SunTrust Banks Inc. 54.36 0.48 0.89 3,280,070

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