Equities Sector Coverage: Stocks Pop on Earnings and Economic Positives

Sector Recap  |

The Consumer Price Index rose 0.6% in September and is up 2.0% year over year. Industrial Production rose by 0.4% in September with Capacity Utilization at 78.3%. The NAHB Housing Market Index rose a point to 41 in October, which is still below the 50 neutral reading.  The Dow Jones Industrial Average traded up to 13,556.37 on Tuesday versus the October 5 high at 13,661.87. The NASDAQ traded up to 3102.59 on Tuesday versus its 50-day simple moving average at 3093.56.

Asian stocks were higher on Tuesday. The Nikkei 225 closed at 8,701 – up 1.44%. The Hang Seng closed at 21,207 – up 0.28%. European exchanges were higher on Tuesday. The FTSE 100 ended the day at 5,871 – up 1.12%. The DAX ended the day at 7,376 – up 1.58%. The CAC 40 ended the day at 3,501 – up 2.36%. The yield on the 10-Year US Treasury rose from 1.660% to 1.726% versus the 50-day and 200-day simple moving averages at 1.695% and 1.803%.

Comex gold rebounded from $1736.1 the Troy ounce to $1748.9 above its 50-day simple moving average at $1713.1 and well below the 2012 high at $1798.1 on October 5. Nymex crude oil rebounded from $91.44 per barrel to $92.32 then declined to $91.30 staying below its 50-day and 200-day simple moving averages at $93.95 and $95.87. The euro versus the dollar rebounded from 1.2945 to 1.3059 staying above its 200-day simple moving average at 1.2825 with the September 17 high at 1.3170.


FMC Technologies (FTI) is a fresh Neutral at Credit Suisse. Baker Hughes (BHI), Schlumberger (SLB), and Weatherford International (WFT) are all new Neutrals at Credit Suisse, which covers Cameron (CAM) and Halliburton (HAL) at Outperform. Denbury Resources (DNR) is raised to Positive from Neutral at Susquehanna. Helmerich & Payne (HP) gets increased to Outperform from Sector Perform at RBC Capital. Big Mover – Overseas Shipholding Group (OSG) is down about 23%. Dow components – Chevron (CVX) is up about 15. Exxon Mobil (XOM) is up about 0.8%. Energy Select Sector SPDR (XLE) was trading at $73.93 at 3:30 PM on Tuesday, up 1.37% on the day – up 6.94% year-to-date.


Packaging of America (PKG) missed estimates by a penny, while beating revenue by $3M. Barclays begins Equal Weight coverage on Agnico-Eagle Mines (AEM), Barrick Gold (ABX), Eldorado Gold (EGO), IAMGOLD (IAG), and Kinross Gold (KCG). It establishes more upbeat Overweights on Newmont Mining (NEM), Goldcorp (GG), and Yamana Gold (AUY). Boise Inc. (BZ) is downgraded to Hold from Buy at TD Securities. Mechel Steel (MTL) is moved to Neutral from Overweight at HSBC Securities. Dow Components – Alcoa (AA) is up about 1.25%. DuPont (DD) is up about 1.25%. The Materials Select Sector SPDR (XLB) was trading at $37.489 at 3:30 PM on Tuesday, up 2.21% on the day – up 11.91% year-to-date.


A123 Systems (AONE) did not have sufficient cash to fund operations and filed for bankruptcy protection, this morning. The company, which received a $249M grant from the government, failed to meet interest payments on approximately $143M of its material debt agreements yesterday. Illinois Tool Works' (ITW) Chairman and CEO David Speer has taken a health-related leave of absence and will be replaced on an interim basis by Vice Chairman Scott Santi, who's also becoming President and COO. Mueller Water (MWA) is moved to Outperform from Sector Perform at RBC Capital. Aecom Technology (ACM) is cut to Hold from Buy at BB&T Capital. Robert Baird gives Neutral-from-Outperform ratings reductions to United Parcel Service (UPS) and Expeditors International (EXPD). Big Mover – A123 Systems (AONE) is down about 75%. Dow components – Boeing Co (BA) is up about 1.9%. Caterpillar (CAT) is up about 2.25%. General Electric (GE) is up about 0.2% 3M Company (MMM) is up 1.7%. United Technologies (UTX) is up about 1.9%. The Industrial Select Sector SPDR (XLI) was trading at $37.06 at 3:30 PM on Tuesday, up 0.98% on the day – up 9.81% year-to-date.

Consumer Discretionary

Bridgepoint Education (BPI) plummeted by as much as 13% in post-market trading after the for-profit education company said it was being investigated by the DOJ over compensation for its admissions staff. Japanese banks Sumitomo Mitsui (SMFG), Mitsubishi UFJ (MTU) and Resona (RSNHF) are providing Panasonic (PC) with $7.6B of loan commitments, allowing the electronics giant to avoid having to raise money in the markets. EU new-car registrations for September highlight the sector's troubles in the region, slumping 10.8% to 1.1M, the fastest drop in a year. Volkswagon (VLKAF), Ford (F), Opel (GM) and Renault all suffered sharp declines, although BMW's (BAMXF) sales climbed 11%. Domino's Pizza (DPZ) beat estimates by 2 cents and revenue by $4M. Mattel (MAT) beat estimates by 5 cents with revenue in-line with estimates. Wolverine World Wide (WWW) missed estimates by a penny and revenue by $9M. Joe's Jeans (JOEZ) beat estimates by 3 cents and revenue by $3M. Genuine Parts (GPC) is a new Equal-Weight at Morgan Stanley. Interval Leisure Group (IILG) is initiated with a Buy at SunTrust. Fossil Inc (FOSL) gets a Buy-from-Neutral boost at Citigroup. Dow Components – Disney (DIS) is up about 1%. Home Depot (HD) is down slightly. McDonalds (MCD) is up about 0.5%. The Consumer Discretionary Select Sector SPDR (XLY) was trading at $47.095 at 3:30 PM on Tuesday, up 0.82% on the day – up 20.69% year-to-date.

Consumer Staples

Russia, the world's second-largest cigarette market, has threatened to crack down even further on sales of the product, with Prime Minister Dmitry Medvedev accusing Philip Morris (PM) and British American Tobacco (BTI) of intentionally hooking women and children. Coca-Cola (KO) beat estimates by a penny, while missing revenue by $50M. WD-40 Company (WDFC) missed estimates by 14 cents and revenue by $9M. The company also cuts its outlook for FY13, now expecting net sales of $356M to $370M, or $2.31 to $2.40 per share, versus Street expectations of $2.56 per share. Kroger (KR) is lifted to Buy from Hold at Jefferies. Lorillard (LO) is upgraded to Outperform from Market Perform at Wells Fargo. Dow components – Coca Cola (KO) is down about 0.75%. Procter & Gamble (PG) is up about 0.4%. Wal-Mart (WMT) is down about 0.6%. The Consumer Staples Select Sector SPDR (XLP) was trading at $36.14 at 3:30 PM on Tuesday, up 0.14% on the day – up 11.23% year-to-date.

Health Care

UnitedHealth's (UNH) Q3 net profit jumped 28% to $1.6B and EPS of $1.50 handily beat forecasts, while revenue climbed 8% to $27.3B, missing expectations. UnitedHealth raised it 2012 EPS outlook to $5.20-$5.25, above consensus of $5.10. ICU Medical (ICUI) beat estimates by 14 cents with revenue in-line with estimates. Johnson & Johnson (JNJ) beat EPS and revenue expectations earning $1.25 a share, on revenue of $17.1 billion. OraSure Technologies (OSUR) is initiated with a Market Perform at Raymond James. Medicines Co. (MDCO) is moved to Buy from Hold at Jefferies. Big Mover – Isis Pharmaceuticals (ISIS) is down about 21.5%. Dow Components – Johnson & Johnson (JNJ) is up about 1.1%. Merck (MRK) is up about 1.3%. Pfizer (PFE) is up about 1%. United Health Group (UNH) is down about 1.1%. The Health Care Select Sector SPDR (XLV) was trading at $41.26 at 3:30 PM on Tuesday, up 0.90% on the day – up 18.94% year-to-date.


RBS (RBS) will be given permission this week to leave the Asset Protection Scheme, a state-backed insurance program covering the bank's old "toxic assets," the FT reports. Japanese banks Sumitomo Mitsui (SMFG), Mitsubishi UFJ (MTU) and Resona (RSNHF) are providing Panasonic (PC) with $7.6B of loan commitments, allowing the electronics giant to avoid having to raise money in the markets. Sumitomo and Mitsubishi are also reportedly helping Softbank (SFTBF) finance its $20.1B acquisition of Sprint (S). Goldman Sachs (GS) beat estimates by 66 cents and revenue by $1.2B. PNC Financial Services (PNC) beat estimates by 4 cents and revenue by $70M. Brown & Brown (BRO) missed estimates by a penny and revenue by $8M. Citigroup’s (C) CEO – Vikram Pandit and President / COO – John Havens - will resign. Aon Corp. (AON) is initiated with a Buy at MKM Partners. Capital Bank (CBF) is initiated with an Outperform at FBR Capital. Home Loan Servicing (HLSS) is a new Buy at Bank of America-Merrill Lynch. Citigroup (C) is moved to Strong Buy from Outperform at Raymond James. Strategic Hotels & Resorts (BEE) is raised to Overweight from Neutral at JPMorgan. Tower Group (TWGP) is placed on the Top Picks List at FBR Capital. Dow Components – American Express (AXP) is up about 1.8% Bank of America (BAC) is down about 0.2%. JP Morgan Chase (JPM) is up about 0.6%. The Travelers Companies (TRV) is up about 1.7%. The Financial Select Sector SPDR (XLF) was trading at $16.065 at 3:30 PM on Tuesday, up 0.47% on the day – up 23.58% year-to-date.

Information Technology

Intel (INTC) and IBM (IBM) are expected to report contrasting fortunes when they release their Q3 earnings after the close today. Analysts estimate that Intel's EPS fell to $0.50 from $0.65 a year ago as revenue dropped 7.1% to $13.23B. IBM's EPS is seen rising to $3.61 from $3.28 but revenue slipping 3% to $25.36B. Microchip (MCHP) warned it expects to report FQ2 revenue of $407M-$408M, below a consensus of $420.3M. Glu Mobile (GLUU) gets begun with a Buy rating at Stifel Nicolaus. Alliance Data Systems (ADS) is listed to Outperform from Market Perform at Wells Fargo. LG Display (LPL) gets lifted to Outperform from Sell at Crédit Agricole. Riverbed Technology (RVBD) is now Neutral from Buy at Citigroup. ZTE Corp. (ZTCOY) is taken to Neutral from Buy at UBS. Big Mover – Bankrate (RATE) is down about 25.5%. Dow Components – Cisco Systems (CSCO) is up about 1.8%. Hewlett-Packard (HPQ) is up about 0.6%. IBM (IBM) is up about 0.7%. Intel Corp (INTC) is up about 2.4%. Microsoft (MSFT) is down slightly. The Technology Select Sector SPDR (XLK) was trading at $30.45 at 3:30 PM on Tuesday, up 1.26% the day – up 19.65% year-to-date.

Telecommunication Services

Telefonica (TEF) plans to raise up to €1.68B in the IPO of Telefonica Deutschland by selling 225M shares in the German unit at €5.25-€6.50 each. Japanese banks Sumitomo Mitsui (SMFG), Mitsubishi UFJ (MTU) are reportedly helping Softbank (SFTBF) finance its $20.1B acquisition of Sprint (S). Softbank's (SFTBF) $20.1B acquisition of Sprint (S) will bring foreign purchases by Japanese corporations to $75B this year, surpassing last year's record $69B and highlighting how the companies have been increasingly making large overseas acquisitions as a way to expand beyond their mature domestic market. Sprint (S) is taken to Market Perform from Underperform by Sanford Bernstein, which says the Softbank (SFTBY) deal makes “bankruptcy risk…de minimis.” Sprint (S) is now Neutral from Outperform at Robert W. Baird, which says the telecom firm still faces many of the same competitive and structural challenges even after the Softbank (SFTBY) deal. Big Mover – Clearwire (CLWR) is down about 17%. Dow Components – AT&T (T) is up about 0.2%. Verizon (VZ) is down about 1%. The NASDAQ Telecommunications Index (IXTC) was trading at $196.52 at 3:30 PM on Tuesday, up 1.07% on the day – down 0.21% year-to-date.


The Big Names – Dominion Resources (D) is down about 0.5%. Edison International (EIX) is up about 0.5%. First Energy (FE) is up about 0.4%. PG&E Corp (PCG) is relatively unchanged. Southern Company (SO) is up about 0.2%. The Utilities Select Sector SPDR (XLU) was trading at $36.695 at 3:30 PM on Tuesday, up 0.12% on the day – up 1.99% year-to-date.


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Symbol Name Price Change % Volume
MMM 3M Company 172.84 -0.50 -0.29 2,187,533 Trade
UNH UnitedHealth Group Incorporated (DE) 265.96 0.06 0.02 2,611,403 Trade
UPS United Parcel Service Inc. 105.79 -0.12 -0.11 2,288,208 Trade
EXPD Expeditors International of Washington Inc. 74.11 -0.04 -0.05 770,500 Trade
KR Kroger Company (The) 22.08 0.19 0.87 7,398,934 Trade
PG Procter & Gamble Company (The) 115.48 0.49 0.43 6,240,874 Trade
GE General Electric Company 10.27 -0.10 -0.96 42,095,061 Trade
CVX Chevron Corporation 125.72 -0.26 -0.21 3,739,153 Trade
SO Southern Company (The) 56.11 0.44 0.79 4,005,412 Trade
PCG Pacific Gas & Electric Co. 17.74 -1.66 -8.56 18,190,669 Trade
GLUU Glu Mobile Inc. 7.65 0.32 4.37 3,486,604 Trade
TEF Telefonica SA 8.34 0.01 0.12 795,134 Trade
PKG Packaging Corporation of America 97.12 -2.23 -2.24 1,439,569 Trade
JNJ Johnson & Johnson 134.71 0.41 0.31 10,038,224 Trade
FOSL Fossil Group Inc. 11.31 -0.17 -1.48 649,129 Trade
AA Alcoa Corporation 23.17 0.57 2.52 3,320,942 Trade
WWW Wolverine World Wide Inc. 27.24 -0.04 -0.15 380,852 Trade
INTC Intel Corporation 50.12 0.20 0.40 14,345,082 Trade
MTU MUFG Mitsubishi UFJ Financial Group Inc. n/a n/a n/a n/a
D Dominion Energy Inc. 78.09 0.59 0.76 2,695,726 Trade
TRV The Travelers Companies Inc. 154.83 1.44 0.94 923,438 Trade
PNC PNC Financial Services Group Inc. (The) 140.20 -1.99 -1.40 2,534,868 Trade
OSUR OraSure Technologies Inc. 8.55 -0.03 -0.35 311,524 Trade
IAG Iamgold Corporation 3.50 -0.05 -1.41 2,134,044 Trade
HP Helmerich & Payne Inc. 51.29 -0.86 -1.65 1,071,664 Trade
C Citigroup Inc. 71.71 -0.06 -0.08 23,365,832 Trade
S Sprint Corporation 7.11 0.01 0.14 14,444,559 Trade
LJPC La Jolla Pharmaceutical Company 9.24 -0.34 -3.55 380,460 Trade
DPZ Domino's Pizza Inc 269.92 -12.19 -4.32 1,668,425 Trade
EIX Edison International 70.56 -0.08 -0.11 2,744,328 Trade
AXP American Express Company 128.57 0.61 0.48 2,355,882 Trade
UTX United Technologies Corporation 133.23 -0.49 -0.37 2,378,726 Trade
MDCO The Medicines Company 36.63 -0.05 -0.14 1,171,737 Trade
AEM Agnico Eagle Mines Limited 51.85 -0.04 -0.08 842,324 Trade
ISIS Isis Pharmaceuticals Inc. n/a n/a n/a 0 Trade
MTL Mechel PAO American Depositary Shares (Each rep. 1) 2.03 0.00 0.00 41,518 Trade
CSCO Cisco Systems Inc. 58.05 0.10 0.17 8,809,738 Trade
CAM Cameron International Corp n/a n/a n/a 0 Trade
SMFG Sumitomo Mitsui Financial Group Inc Unsponsored American Depositary Shares (Japan) 7.03 0.01 0.14 1,015,040 Trade
GS Goldman Sachs Group Inc. (The) 211.58 -2.36 -1.10 2,600,222 Trade
MCHP Microchip Technology Incorporated 92.60 0.89 0.97 1,503,639 Trade
VZ Verizon Communications Inc. 57.58 0.39 0.68 11,734,393 Trade
MAT Mattel Inc. 12.00 0.04 0.33 2,732,168 Trade
ABX GOLD Barrick Gold Corporation (BC) n/a n/a n/a 0
GM General Motors Company 39.36 0.15 0.38 5,448,843 Trade
ICUI ICU Medical Inc. 249.10 0.30 0.12 103,202 Trade
BAC Bank of America Corporation 29.22 -0.23 -0.78 46,462,058 Trade
RBS Royal Bank of Scotland Group Plc New (The) ADS 5.82 -0.05 -0.85 877,689 Trade
IILG Interval Leisure Group Inc. n/a n/a n/a n/a
MCD McDonald's Corporation 214.21 1.22 0.57 2,408,827 Trade
EGO Eldorado Gold Corporation 6.98 -0.01 -0.14 3,238,742 Trade
WFT WFTIF Weatherford International plc (Ireland) n/a n/a n/a 0
AUY Yamana Gold Inc. (Canada) 2.65 0.01 0.38 8,858,425 Trade
ACM AECOM 37.36 -0.01 -0.03 371,488 Trade
JOEZ Joe's Jeans Inc. n/a n/a n/a n/a
WDFC WD-40 Company 175.22 -2.80 -1.57 114,088 Trade
DNR Denbury Resources Inc. 1.22 -0.07 -5.43 13,817,894 Trade
PM Philip Morris International Inc 81.47 -0.42 -0.51 5,325,317 Trade
F Ford Motor Company 10.42 -0.07 -0.67 33,753,508 Trade
PFE Pfizer Inc. 42.75 0.35 0.83 19,320,588 Trade
BEE Strategic Hotels & Resorts Inc. n/a n/a n/a 0 Trade
BPI ZVO BiotechPharmaceutical Index n/a n/a n/a 0
HPQ HP Inc. 21.35 0.12 0.57 8,418,966 Trade
MRK Merck & Company Inc. (new) 80.96 1.23 1.54 10,422,286 Trade
BRO Brown & Brown Inc. 34.92 -0.07 -0.20 584,756 Trade
ITW Illinois Tool Works Inc. 151.26 -0.22 -0.15 869,759 Trade
FE FirstEnergy Corp. 43.86 0.45 1.04 3,525,101 Trade
AON Aon plc Class A (UK) 197.53 0.06 0.03 739,425 Trade
KO Coca-Cola Company (The) 52.13 0.01 0.02 5,876,139 Trade
T AT&T Inc. 33.71 0.06 0.18 20,255,058 Trade
LPL LG Display Co Ltd AMERICAN DEPOSITORY SHARES 7.19 0.01 0.14 231,279 Trade
MWA MUELLER WATER PRODUCTS 9.53 -0.07 -0.73 392,433 Trade
CAT Caterpillar Inc. 139.64 1.28 0.93 4,498,676 Trade
HAL Halliburton Company 23.46 -0.29 -1.22 13,114,445 Trade
NEM Newmont Goldcorp Corporation 39.17 -0.25 -0.63 4,264,901 Trade
ADS Alliance Data Systems Corporation 150.02 0.42 0.28 488,928 Trade
GPC Genuine Parts Company 104.81 -0.60 -0.57 650,013 Trade
FTI TechnipFMC plc 25.26 -0.52 -2.02 1,782,155 Trade
SLB Schlumberger N.V. 40.47 -0.34 -0.83 6,903,792 Trade
MSFT Microsoft Corporation 138.90 0.00 0.00 16,651,457 Trade
WMT Walmart Inc. 114.98 0.38 0.33 3,346,076 Trade
IBM International Business Machines Corporation 143.32 0.58 0.41 2,368,309 Trade
JPM JP Morgan Chase & Co. 113.90 -1.40 -1.21 12,946,597 Trade
DIS The Walt Disney Company 145.06 0.18 0.12 5,289,248 Trade
HD Home Depot Inc. (The) 218.70 0.47 0.22 3,141,289 Trade
XOM Exxon Mobil Corporation 77.08 -0.55 -0.71 7,116,356 Trade
BA The Boeing Company 361.61 -3.72 -1.02 4,814,634 Trade



Symbol Last Price Change % Change






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