New Home Sales fell 2.3% in August to an annual rate of just 295,000 units. The inventory of new homes fell to another new record low of 162,000 units. The price of a new home fell 7.7% year over year. Tomorrow we get Consumer Confidence, then Durable Goods Orders on Wednesday, the final reading of Q2 GDP on Thursday, and Personal Income & Spending and Chicago PMI on Friday. The Dow Jones Industrial Average opened well above its 200-week and 120-month simple moving averages at 10,662 and 10,590 and traded higher to a final half hour high above 11,000. The NASDAQ traded down from 2501.48 to 2446.12 then rebounded above 2500 into the final half hour of trading.
Asian stocks declined on Monday with the Nikkei 225 lower by 2.17% to 8,374 and the Hang Seng down 1.48% to 17,408. European stocks opened lower but rebounded into the green on hopes of new measures to ease Europe’s debt crisis. The FTSE 100 closed up just 0.45% to 5,089 with the DAX surging 2.87% to 5,346 and the CAC 40 climbing 1.75% to 2,859. The yield on the 10-Year US Treasury, which tested an all time low of 1.671 percent on Friday rose to 1.909 on Monday. Gold plunged to $1535.0 the Troy ounce overnight then rebounded to close above $1600. This volatility is a sign that the parabolic bubble has popped. Crude oil fell to $77.11 per barrel then rebounded to $81.29 staying well below its 200-week simple moving average at $83.63, as global economic concerns continue. The euro versus the US dollar traded between 1.3365 and 1.3548.
Energy
Green Plains Renewable Energy (GPRE) is a new Neutral at Credit Suisse. Occidental Petroleum (OXY) is upgraded to Buy from Hold at Citigroup. Tortoise Energy Infrastructure (TYG) is taken to Outperform from Perform with a $41 target at brokers Robert W. Baird. First Solar (FSLR) gets moved by Maxim Group to Hold from Sell. In afternoon trading: Shares of Uranium Energy (UEC) are down about 11%. Shares of Trina Solar (TSL) are down about 5%. Shares of Western Refining (WNR) are up about 8.9%. Shares of Key Energy Services (KEG) are up about 7.8%. Shares of RPC Inc. (RES) are up about 7.8%. Shares of Helix Energy Solutions (HLX) are up about 6.8%. Shares of CONSOL Energy (CNX) are up about 6.2%. Shares of Arch Coal (ACI) are up about 6.1%. Shares of Tesoro (TSO) are up about 6%. Shares of ION Geophysical (IO) are up about 5.7%. Shares of Occidental Petroleum are up about 5.3%. Shares of Marathon Oil (MRO) are up about 5%.
Energy Select Sector SPDR (XLE) was trading at $60.84 at 4:00 PM on Monday, up 3.65% on the day – down 10.86% year-to-date.
Materials
Rio Tinto (RIO) is reportedly considering spinning off part of its Australian aluminum assets in response to a planned carbon emissions tax. CEMEX S.A. (CX) is boosted to Overweight from Equal Weight by Barclays. Ternium S.A. (TX) is taken to Buy from Neutral at Goldman. In afternoon trading: Shares of Tronox (TROX) are down about 26%. Shares of Icanhoe Mines (IVN) are down about 13.25%. Shares of Horsehead Holding (ZINC) are down about 9.2%. Shares of Headwaters (HW) are down about 7.4%. Shares of Avalon Rare Metals (AVL) are up about 14%. Shares of Silvercorp Metals (SVM) are up about 7.6%. Shares of Sherwin Williams (SHW) are up about 6.5%.
The Materials Select Sector SPDR (XLB) was trading at $31.21 at 4:00 PM on Monday, up 3.21% on the day – down 18.75% year-to-date.
Industrials
After three years of delays and billions of dollars in extra costs, Boeing (BA) delivered yesterday its first 787 Dreamliner to All Nippon Airways. Roadrunner Transportation (RRTS) is reinstated as a Buy at BB&T Capital. United Technologies (UTX) is lifted to Overweight from Equal Weight at Morgan Stanley. Foster Wheeler (FWLT) is upgraded to Outperform from Market Perform at BMO Capital. Herman Miller (MLHR) is raised to Strong Buy from Outperform at Raymond James. Goodrich (GR) gets moved to Equal Weight from Overweight at Morgan Stanley. In afternoon trading: Shares of A-Power Energy Generation Systems (APWR) are down about 80%. Shares of American Superconductor (AMSC) are down about 9.5%.
The Industrial Select Sector SPDR (XLI) was trading at $30.05 at 4:00 PM on Monday, up 2.52% on the day – down 13.82% year-to-date.
Consumer Discretionary
McGraw-Hill (MHP) disclosed this morning that it had received a Wells Notice from the SEC. Officials are considering a civil injunctive against McGraw’s S&P over the rating of a CDO. Netflix (NFLX) is boosted to Buy from Neutral by Merriman. Expedia (EXPE) is upgraded to Overweight from Neutral at Piper Jaffray with a $33 target price. In afternoon trading: Shares of Blockbuster (BLOAQ) are up about 28.5%. Shares of American Eagle (AEO) are up about 8.8%. Shares of Macy’s (M) are up about 6.5%. Shares of Eastman Kodak (EK) are down about 25.25%. Shares of Xueda Education Group (XUE) are down about 11%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $36.57 at 4:00 PM on Monday, up 2.35% on the day – down 2.25% year-to-date.
Consumer Staples
Green Mountain Coffee Roasters (GMCR) is begun with a Buy and $130 price objective at Argus. Estee Lauder (EL) is lifted to Buy from Hold with a $113 target price at Stifel Nicolaus. Nestle (NSRGY) and Danone (DANOY) are both downgraded to Buy from Hold at ING Group. In afternoon trading: Shares of The Fresh Market (TFM) are up about 8.9%. Shares of Smart Balance (SMBL) are up about 7.3%. Shares of Dole Food (DOLE) are up about 6.4%. Shares of Spartan Stores (SPTN) are up about 6.2%. Shares of American Oriental Bioengineering (AOB) are down about 7.5%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $30.07 at 4:00 PM on Monday, up 1.93% on the day – up 2.59% year-to-date.
Healthcare
Alkermes (ALKS) is raised to Buy from Hold at Jefferies. In afternoon trading: Shares of Orexigen Therapeutics (OREX) are down about 11%. Shares of Skilled Healthcare (SKH) are down about 8.5%. Shares of Tengion (TNGN) are down about 6.1%. Shares of United Therapeutics (UTHR) are down about 5.7%. Shares of Akorn (AKRX) are down about 5.5%. Shares of Antares Pharma (AIS) are up about 7.2%. Shares of Affymetrix (AFFX) are up about 6.6%. Shares of ImmunoGen (IMGN) are up about 5.8%. Shares of NuVasive (NUVA) are up about 5.9%.
The Health Care Select Sector SPDR (XLV) was trading at $32.00 at 4:00 PM on Monday, up 1.65% on the day – up 1.59% year-to-date.
Financials
UBS (UBS) CEO Oswald Gruebel has stepped down amid the fallout of the $2.3B rogue trading scandal, and board member Sergio Ermotti has been appointed CEO on an interim basis. First Horizon (FHN) is moved to Overweight from Equal Weight at Morgan Stanley. First Cash Financial (FCFS) is now Underperform from Neutral at Sterne Agee. People’s United Financial (PBCT) is downgraded to Equal Weight from Overweight at Morgan Stanley. In afternoon trading: Shares of Commerzbank AG (CRZBY) are up about 22.8%. Shares of Allianz (AZSEY) are up about 10.5%. Shares of Deutsche Bank (DB) are up about 10.3%. Shares of ING Groep (ING) are up about 10%. Shares of Ambac Financial (ABKFQ) are down about 19.6%.
The Financial Select Sector SPDR (XLF) was trading at $12.20 at 4:00 PM on Monday, up 4.45% on the day – down 23.51% year-to-date.
Information Technology
Groupon is still committed to going public, but is unsure on IPO timing after several missteps and in light of market volatility. Itron (ITRI) is a new Overweight at Morgan Stanley. Advanced Micro Devices (AMD) is now Buy from Neutral at UBS. Novellus (NVLS) is now Neutral from Negative at Susquehanna. Cisco Systems (CSCO) is taken to Neutral from Buy at brokerage firm Miller Tabak. In afternoon trading: Shares of InterDigital (IDCC) are down about 14.5%. Shares of Energy Conversion Devices (ENER) are down about 13%. Shares of Entropic Communications (ENTR) are up about 11.4%.
The Technology Select Sector SPDR (XLK) was trading at $24.30 at 4:00 PM on Monday, up 1.25% on the day – down 3.53% year-to-date.
Telecommunications Services
In afternoon trading: Shares of Clearwire (CLWR) are up about 5.2%. Actives: Shares of Sprint Nextel (S) are down about 2.2%. Shares of AT&T (T) are up about 1.4%. Shares of Level 3 Communications (LVLT) are up about 1.3%. Shares of Verizon (VZ) are up about 1.1%. Shares of Frontier Communications (FTR) are up about 0.6%. Shares of Vodafone (VOD) are up about 1%.
The NASDAQ Telecommunications Index (IXTC) was trading at $184.66 at 4:00 PM on Monday, up 1.67% on the day – down 18.06% year-to-date.
Utilities
NV Energy (NVE) is increased to Buy from Neutral at Goldman, which also adds Great Plains Energy (GXP) to its Conviction Buy List. PNM Resources (PNM) is raised by both Wells Fargo (Outperform from Market Perform) and Suntrust (Buy from Neutral). El Paso Electric (EE) gets cut to Neutral from Buy at Goldman, which also pulls the name from its list of Conviction Buys. In afternoon trading: Shares of Tokyo Electric Power (TKECF) are down about 11.8%. Shares of Ormat Technologies (ORA) are up about 9.5%> Shares of RWE (RWEOY) are up about 6.9%. Shares of E ON AG (EONGY) are up about 6%. Shares of GDF Suez (GDFZY) are up about 5.1%.
The Utilities Select Sector SPDR (XLU) was trading at $33.68 at 4:00 PM on Monday, up 0.81% on the day – up 7.47% year-to-date.
STOCKS: GPRE, OXY, TYG, FSLR, UEC, TSL, WNR, KEG, RES, HLX, CNX, ACI, TSO, IO, MRO, RIO, CX, TX, TROX, IVN, ZINC, HW, AVL, SVM, SHW, BA, RRTS, UTX, FWLT, MLHR, GR, APWR, AMSC, MHP, NFLX, EXPE, BLOAQ, AEO, M, EK, XUE, GMCR, EL, NSRGY, DANOY, TFM, SMBL, DOLE, SPTN, AOB, ALKS, OREX, SKH, TNGN, UTHR, AKRX, AIS, AFFX, IMGN, NUVA, UBS, FHN, FCFS, PBCT, CRZBY, AZSEY, DB, ING, ABKFQ, ITRI, AMD, NVLS, CSCO, IDCC, ENER, ENTR, CLWR, S, T, LVLT, VZ, FTR, VOD, NVE, GXP, PNM, EE, TKECF, ORA, RWEOY, EONGY, GDFZY
