Equities Sector Coverage: Stocks Pare Losses But Dow Still Closes in Red

Sector Recap  |

Consumer credit expanded by $21.36 billion in March, more than twice of the amount that was expected and at the fastest rate since late 2001. The Dow Jones Industrial Average traded down to 12,970.00 then rebounded above the flat line at 13,038.27 but stayed below the 50-day simple moving average at 13,062 going into the final half hour of trading. The NASDAQ traded down to 2939.21 then rebounded to 2970.20 well below its 50-day simple moving average at 3029.

Asian stocks plunged on Monday following the election news from Greece and France. The Nikkei 225 ended their session at 9,119 – down 2.78% on the day. The Hang Seng ended their session at 20,537 – down 2.61% on the day. European exchanges opened significantly lower, but recovered as the sun rose on Wall Street. The FTSE 100 was closed at 5,655. The DAX ended their session at 6,569 – up 0.12% on the day. The CAC 40 ended their session at 3,214 – up 1.65% on the day. The yield on the 10-Year US Treasury traded down to 1.821 percent in reaction to the European elections then rose to 1.882, still well below its 50-day and 200-day simple moving averages at 2.073 and 2.056.

Gold declined from $1644.0 the Troy ounce to $1632.2 well below the 50-day and 200-day simple moving averages at $1665.5 and $1699.0. Crude oil traded down from $98.24 per barrel to $95.34 then back above $98.00 into the final hour of trading. The low for oil was below its 200-day simple moving average at $96.32 with the 50-day at $104.71. The euro versus the dollar traded down to 1.2961 then rebounded to 1.3064 well below its 50-day simple moving average at 1.3190.

Energy

Some companies in the solar industry including First Solar (FSLR) has been idling capacity, as shares fell 6% on Friday. Statoil (STO) signed a potential $100 billion cooperation deal with Rosneft to develop the country's Arctic offshore energy resources. HollyFrontier (HFC) missed Q1 EPS estimates by seven cents with a beat on the revenue line. Northern Oil & Gas (NOG) reported Q1 EPS of fourteen cents which may not be comparable to the consensus of 24 cents. Gran Tierra Energy (GTE) missed Q1 EPS estimates by thirteen cents with in-line revenue. Murphy Oil (MUR) has been downgraded to Hold from Buy at Brean Murray. Penn West Energy (PWE) has been downgraded to Neutral from Outperform at Macquarie. Dow components – Chevron (CVX) – down 0.6%, Exxon Mobil (XOM) down 0.3%.

Energy Select Sector SPDR (XLE) was trading at $68.16 at 3:30 PM on Monday, down 0.20% on the day – down 1.40% year-to-date.

Materials

A Delaware judge ruled that Martin Marietta Materials' (MLM) hostile $5.5 billion bid for Vulcan Materials (VMC) has to be postponed for four months. Westlake Chemical (WLK) has withdrawn its $1.2 billion to acquire Georgia Gulf (GGC)) after a better offer of $35 pershare offer was rejected as too low. Globe Specialty Metals (GSM) missed Q1 EPS estimates by two cents with a beat on the revenue line. Gold miner Allied Nevada (ANV) missed Q1 EPS estimates by eleven cents with in-line revenue. Dow components – Alcoa (AA) down 1.3%, DuPont (DD) down 0.5%.

The Materials Select Sector SPDR (XLB) was trading at $35.70 at 3:30 PM on Monday, up 0.06% on the day – up 6.57% year-to-date.

Industrials

Investors have not been satisfied with the improved performance of General Motors (GM) and Ford (F) as shares are down about 30% year to date for each one, with the worry being the losses coming out of Europe. Trex Company (TREX) beat Q1 EPS estimates by 24 cents with better than expected revenue. Honda Motor (HMC) has been upgraded to Outperform from Neutral at Credit Suisse. Dow components – Boeing Co (BA) down 0.4%, Caterpillar (CAT) down 1.2%, General Electric (GE) down 0.1%, 3M Company (MMM) down 0.6%, United Technologies (UTX) down 0.5%.

The Industrial Select Sector SPDR (XLI) was trading at $36.26 at 3:30 PM on Monday, down 0.11% on the day – up 7.44% year-to-date.

Consumer Discretionary

Cablevision (CVC) rose 1.5% after the close on Friday after the Wall Street Journal reported that the company will try and sell its Clearview Cinemas movie theater chain. Avis Budget Group (CAR) reported in-line Q1 EPS with revenue up 31.4% year over year. Cinemark (CNK) beat Q1 EPS estimates by three cents with revenue up 19.8% year over year. Lowe’s (LOW): has been upgraded to Overweight from Equal Weight and Morgan Stanley. Priceline.com (PCLN) has been upgraded by Nomura to Neutral from Reduce with a $725 price target, on growth in the large US hotel market. Carnival Corp (CCL) Goldman Sachs downgrades the cruise company to Neutral from Buy due to uncertainty in the European economy. Dow Components – Disney (DIS) up 1.5% ahead of its earnings report, Home Depot down 0.6%, McDonalds (MCD) down 0.2%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $45.00 at 3:30 PM on Monday, up 0.20% on the day – up 15.33% year-to-date.

Consumer Staples

Tyson Foods (TSN) beat FQ2 EPS estimates by four cents but missed on the revenue line. TravelCenters of America (TA) reported a Q1 EPS cost by 49 cents with revenue up 11% year over year. Cott Corp (COT) has been upgraded to Overweight from Equal Weight by Morgan Stanley. Newell Rubbermaid (NWL) has been upgraded to Outperform from Perform with a $23 price target at Oppenheimer. PepsiCo (PEP) has been upgraded to Overweight from Equal Weight at Morgan Stanley, and Dr Pepper Snapple (DPS) to Equal Weight from Underweight. Procter & Gamble (PG): has been downgraded to Market Perform from Outperform with Wells Fargo. Dow components – Kraft (KFT) up 0.5%, Coca Cola (KO) up 0.3%, Procter & Gamble (PG) flat, Wal-Mart (WMT) up 0.7%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $34.15 at 3:30 PM on Monday, up 0.21% on the day – up 5.11% year-to-date.

Health Care

BioCryst Pharmaceuticals (BCRX) beat Q1 EPS estimates by thirteen cents with better than expected revenue. Achillion Pharmaceuticals (ACHN) has been upgraded to Neutral from Sell at UBS.
Dow Components – Johnson & Johnson (JNJ) up 0.1%, Merck (MRK) down 0.4%, Pfizer (PFE) flat.

The Health Care Select Sector SPDR (XLV) was trading at $37.07 at 3:30 PM on Monday, up 0.32% on the day – up 6.86% year-to-date.

Financials

Berkshire Hathaway (BRK.A) reported Q1 net earnings at $1,966 per share with operating earnings up 67% year over year to $2.67 billion. The U.S. Treasury has launched a public offering of some of taxpayers’ 70% stake or 1.25 billion AIG (AIG) shares, and AIG has indicated that they will buy $2 billion in the offering. UBS (UBS) thinks that demand has rebounded for toxic mortgage debt and is seeking buyers for CDOs assembled in 2007. The securities have a face value of $1.5 billion backed by skyscrapers, malls and hotel loans. Barclays (BCS) plans to launch an online savings bank in the US market and will attract customers by offering interest rates of around 1% on deposits. BancorpSouth (BXS) is initiated with an Equal Weight rating at Morgan Stanley. Dow Components – American Express (AXP) flat, Bank of America (BAC) up 2.0%, JP Morgan Chase (JPM) flat, Travelers (TRV) down 0.3%.

The Financial Select Sector SPDR (XLF) was trading at $15.20 at 3:30 PM on Monday, up 0.66% on the day – up 16.92% year-to-date.

Information Technology

InvenSense (INVN) shares plunged 25.5% in after hours trading on Friday after reporting in-line FQ4 EPS but the company lower guidance for FQ1 revenue. Yahoo (YHOO) appears to be negotiating to sell a 15% to25% stake in Alibaba (ALBCF.PK) back to the Chinese e-commerce company. It appears that Micron (MU) has won the right to bid for Elpida after offering over $2.5 billion for the bankrupt Japanese chipmaker. LG Electronics (LGEAF.PK) will launch a Google-powered (GOOG) Internet TV in the US as part of a push to defend against Apple (AAPL) and its rumored iTV. Cognizant Technology Solutions (CTSH) beat Q1 EPS estimates by thirteen cents with in-line revenue. NVIDIA (NVDA) has been upgraded to Buy from Neutral at Nomura. Texas Instruments (TXN) has been upgraded to Neutral from Reduce at Nomura.Dow Components – Cisco Systems (CSCO) up 0.3%, Hewlett-Packard (HPQ) down 0.9%, IBM (IBM) down 0.5%, Intel Corp (INTC) down 0.1%, Microsoft (MSFT) down 0.8%.

The Technology Select Sector SPDR (XLK) was trading at $29.05 at 3:30 PM on Monday, down 0.07% on the day – up 14.15% year-to-date.

Telecommunication Services

Leap Wireless (LEAP) has been upgraded to Neutral from Underweight at Piper Jaffray. Dow components – AT&T (T) up 0.1%, Verizon (VZ) up 0.5%.

The NASDAQ Telecommunications Index (IXTC) was trading at $201.76 at 3:30 PM on Monday, down 0.21% on the day – up 2.46% year-to-date.

Utilities

Frontier Communications (FTR) reported Q1 EPS of three cents with in-line revenue. Alliant Energy (LNT) has been downgraded to Hold from Buy at Wunderlich, which takes its target to $45 from $47. Dominion Resources (D) down 0.4%, Edison International (EIX) flat, First Energy (FE) up 0.0.4%, PG&E Corp (PCG) down 0.4%, Southern Company (SO) up 0.1%.

The Utilities Select Sector SPDR (XLU) was trading at $35.47 at 3:30 PM on Monday, down 0.28% on the day – down 1.42% year-to-date.

STOCKS: CVX, XOM, FSLR, HFC, NOG, GTE, MUR, PWE, AA, DD, MLM, VMC, GGC, GSM, ANV, BA, CAT, GE, MMM, UTX, GM, F, TREX, HMC, DIS, HD, MCD, CVC, CAR, CNK, LOW, PCLN, CCL, KFT, KO, PG, WMT, TSN, TA, COT, NWL, PEP, DPS, JNJ, MRK, PFE, BCRX, ACHN, AXP, BAC, JPM, TRV, BRK.A, AIG, UBS, BCS, CSCO, HPQ, IBM, INTC, MSFT, INVN, YHOO, ALBCF.PK, MU, LGEAF.PK, AAPL, CTSH, NVDA, TXN, T, VZ, LEAP, D, EIX, FE, PCG, FTR, LNT

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
GTE Gran Tierra Energy Inc. 2.31 0.02 0.87 1,089,061
NOG Northern Oil and Gas Inc. 2.48 0.06 2.48 2,597,820
MMM 3M Company 209.35 1.58 0.76 1,534,158 Trade
CCL Carnival Corporation 58.82 0.55 0.94 2,234,599 Trade
TSN Tyson Foods Inc. 63.32 0.26 0.41 2,841,066 Trade
FTR Frontier Communications Corporation 2.55 -0.03 -1.16 3,466,676 Trade
GSM Ferroglobe PLC 2.11 -0.07 -3.21 973,590 Trade
PG Procter & Gamble Company (The) 100.25 0.47 0.47 7,925,568 Trade
GE General Electric Company 10.17 0.14 1.40 50,741,310 Trade
CVX Chevron Corporation 119.39 0.25 0.21 4,517,629 Trade
PCG Pacific Gas & Electric Co. 18.77 -0.63 -3.25 16,304,350 Trade
JNJ Johnson & Johnson 136.60 1.18 0.87 5,223,858 Trade
AA Alcoa Corporation 30.17 0.59 1.99 3,197,583 Trade
COT Cott Corporation 13.86 -1.73 -11.10 6,358,348 Trade
INTC Intel Corporation 52.49 1.08 2.10 31,934,146 Trade
D Dominion Energy Inc. 75.05 0.71 0.96 3,219,113 Trade
TRV The Travelers Companies Inc. 131.02 1.20 0.92 1,422,860 Trade
CTSH Cognizant Technology Solutions Corporation 72.38 1.04 1.46 5,585,528 Trade
MFA MFA Financial Inc. 7.33 0.05 0.69 3,030,227 Trade
BCRX BioCryst Pharmaceuticals Inc. 9.00 0.30 3.45 516,856 Trade
CVC Cablevision Systems Corporation Class A n/a n/a n/a 0 Trade
HMC Honda Motor Company Ltd. 28.17 0.44 1.59 815,535 Trade
BCS Barclays PLC 8.16 -0.21 -2.51 3,288,391 Trade
EIX Edison International 61.41 0.15 0.24 3,909,806 Trade
PCLN BKNG Calfrac Well Services Ltd. n/a n/a n/a n/a
AXP American Express Company 107.44 0.83 0.78 2,256,445 Trade
PWE OBE Penn West Petroleum Ltd n/a n/a n/a n/a
UTX United Technologies Corporation 127.77 1.45 1.15 3,158,097 Trade
NVDA NVIDIA Corporation 159.19 3.42 2.20 10,043,531 Trade
TXN Texas Instruments Incorporated 107.31 0.67 0.63 4,392,946 Trade
MUR Murphy Oil Corporation 29.58 0.04 0.14 1,314,408 Trade
LOW Lowe's Companies Inc. 106.27 0.75 0.71 2,734,640 Trade
MLM Martin Marietta Materials Inc. 190.00 -0.38 -0.20 422,094 Trade
CSCO Cisco Systems Inc. 50.11 0.70 1.42 22,008,055 Trade
VZ Verizon Communications Inc. 56.92 0.77 1.37 12,534,431 Trade
TA TravelCenters of America LLC 4.93 0.00 0.00 112,230 Trade
GM General Motors Company 39.99 0.37 0.93 6,742,713 Trade
BAC Bank of America Corporation 29.08 -0.21 -0.72 47,887,776 Trade
HFC HollyFrontier Corporation 55.52 0.27 0.49 2,309,042 Trade
MCD McDonald's Corporation 183.17 0.36 0.20 3,073,495 Trade
TREX Trex Company Inc. 75.73 0.09 0.12 863,863 Trade
UBS UBS Group AG Registered 12.34 0.01 0.08 1,892,265 Trade
VMC Vulcan Materials Company (Holding Company) 112.68 -0.31 -0.27 1,012,309 Trade
ACHN Achillion Pharmaceuticals Inc. 2.50 0.03 1.21 1,549,084 Trade
F Ford Motor Company 8.71 0.00 0.00 40,947,503 Trade
PFE Pfizer Inc. 42.96 0.82 1.95 23,510,009 Trade
DPS KDP Dr Pepper Snapple Group Inc n/a n/a n/a n/a
FSLR First Solar Inc. 53.73 1.78 3.43 4,112,376 Trade
AIG American International Group Inc. 42.87 -0.14 -0.33 4,929,464 Trade
HPQ HP Inc. 23.74 0.35 1.50 6,729,697 Trade
YHOO Yahoo! Inc. n/a n/a n/a 0 Trade
MRK Merck & Company Inc. (new) 80.77 0.94 1.18 7,955,621 Trade
CNK Cinemark Holdings Inc Inc. 38.29 1.39 3.77 1,770,436 Trade
FE FirstEnergy Corp. 40.72 0.67 1.67 3,804,366 Trade
MU Micron Technology Inc. 42.57 1.04 2.50 22,834,253 Trade
KO Coca-Cola Company (The) 45.28 -0.58 -1.26 24,728,388 Trade
T AT&T Inc. 31.15 0.32 1.04 23,357,232 Trade
CAT Caterpillar Inc. 138.68 -0.20 -0.14 3,485,007 Trade
CAR Avis Budget Group Inc. 35.33 0.88 2.55 10,784,205 Trade
MSFT Microsoft Corporation 110.97 1.56 1.43 27,763,218 Trade
WMT Walmart Inc. 99.55 0.16 0.16 8,086,946 Trade
IBM International Business Machines Corporation 139.25 1.41 1.02 3,113,698 Trade
AAPL Apple Inc. 172.97 1.91 1.12 18,913,154 Trade
JPM JP Morgan Chase & Co. 105.00 -0.47 -0.45 10,647,258 Trade
DIS The Walt Disney Company 115.25 0.96 0.84 8,735,066 Trade
HD Home Depot Inc. (The) 192.39 0.57 0.30 3,321,635 Trade
XOM Exxon Mobil Corporation 78.42 0.60 0.77 9,519,281 Trade
BA The Boeing Company 424.05 6.47 1.55 3,132,298 Trade

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Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     
BA

     
WMT

     
DIS

     
XOM

     

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