Equities Sector Coverage: Stocks Resume Downward Trend

Sector Recap |

Wall StreetThe Dow Jones Industrial Average traded down to 12,661.48 Monday morning then rebounded above 12,760 in the afternoon before fading in the final hour of trading. The NASDAQ traded down to 2898.90 Monday morning then rebounded to 2924.89 then consolidated that range.

Asian stocks were mixed on Monday. The Nikkei 225 ended their session at 8,974 – up 0.23% on the day. The Hang Seng ended their session at 19,735 – down 1.15% on the day. European exchanges were lower on Monday. The FTSE 100 ended their session at 5,466 – down 1.97% on the day. The DAX ended their session at 6,452 – down 1.94% on the day. The CAC 40 ended their session at 3,058 – down 2.29% on the day. The yield on the 10-Year US Treasury declined from 1.839 percent to 1.765, a new year to date low and well below its 50-day and 200-day simple moving averages at 2.057 and 2.033.

Gold traded down from $1585.8 the Troy ounce to $1555.0 well below the “Death Cross” 50-day and 200-day simple moving averages at $1651.6 and $1698.2. Crude oil traded down from $95.83 per barrel to $93.65, a new year to date low below its 200-day simple moving average at $96.26. The euro versus the dollar traded down from 1.2904 to 1.2829 below its 50-day simple moving average at 1.3153.

Energy

Chesapeake Energy (CHK) reported that its received a $3 billion unsecured loan from Goldman Sachs and Jefferies Group, which will be repaid from 2012 asset sales. McDermott (MDR) was a major upside mover on Friday after better than expected Q1 earnings and assuring analysts that the company is returning to normal levels of profitability with strong growth in operating margin. Concho Resources (CXO) will buy all the oil and natural gas assets of Three Rivers Operating for $1 billion. Interoil (IOC) beat Q1 EPS estimates by 39 cents with better than expected revenue. Seadrill (SDRL) beats Q1 EPS estimates by eighteen cents with in-line revenue. Walter Energy (WLT) has been initiated with an Outperform rating with Wells Fargo. Arch Coal (ACI) has been upgraded by UBS to Buy from Neutral with $11 price target. McDermott International (MDR) has been upgraded to Overweight from Neutral at JP Morgan. Dow components – Chevron (CVX) – down 0.65%, Exxon Mobil (XOM) down 0.87%.
Energy Select Sector SPDR (XLE) was trading at $66.32 at 3:30 PM on Monday, down 1.51% on the day – down 4.06% year-to-date.

Materials

IAMGOLD Corp (IAG) beat Q1 EPS estimates by four cents with a miss on the revenue line. Cabot (CBT) will boost its quarterly dividend by 11% to $0.20 from $0.18 per share. Silver Wheaton (SLW) missed Q1 EPS estimates by a penny with a miss on the revenue line. Darling International (DAR) recently reported missed Q1 quarterly results as lower raw material volumes and lower finished product prices weighed on bottom line margins. Louisiana-Pacific (LPX) has been upgraded to Outperform from Sector Perform at RBC Capital. Dow components – Alcoa (AA) down 0.44%, DuPont (DD) down 0.97%.
The Materials Select Sector SPDR (XLB) was trading at $34.55 at 3:30 PM on Monday, down 1.31% on the day – up 3.13% year-to-date.

Industrials

Three former executives of General Electric (GE) affiliates were convicted by a federal jury in New York of conspiracy related to rigging contracts in the municipal bond market. On Homebuilders, Guggenheim gives D.R. Horton (DHI), Lennar (LEN), PulteGroup (PHM), and Toll Brothers (TOL) have been upgraded to Buy from Neutral, and Meritage Homes (MTH) and Ryland (RYL) upgraded to Buy from Sell. Magna International (MGA) have been upgraded to Hold from Sell at Société Générale. Dow components – Boeing Co (BA) down 0.18%, Caterpillar (CAT) down 1.21%, General Electric (GE) down 1.45%, 3M Company (MMM) down 0.55%, United Technologies (UTX) down 1.28%.
The Industrial Select Sector SPDR (XLI) was trading at $35.31 at 3:30 PM on Monday, down 1.01% on the day – up 4.62% year-to-date.



Consumer Discretionary

Shares of Francesca's Holdings (FRAN) moved down sharply on Friday on word that the company may float another secondary offering. Gamestop (GME) is initiated with a Neutral rating at Lazard. Tumi Holdings (TUMI), the apparel outfit is a recent IPO that has been initiated with a Buy rating at Jefferies and an Outperform rating with William Blair. Francesca’s (FRAN) have been upgraded to Positive from Neutral at Susquehanna. Dow Components – Disney (DIS) down 0.50%, Home Depot down 0.50%, McDonalds (MCD) down 0.54%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $43.69 at 3:30 PM on Monday, down 1.24% on the day – up 11.97% year-to-date.

Consumer Staples

Avon (AVP) shares are up 8.4% premarket after the cosmetics company indicated it would consider Coty's improved $10.7 billion bid and expects to respond within a week. Coty will stop making further public steps to acquire the company to allow Avon to conduct due diligence. Caribou Coffee (CBOU) has been upgraded to Buy from Hold at Dougherty. US Airways (LCC) has been upgraded to Buy from Neutral at Sterne Agee with an $18 price target, citing lower fuel prices, stronger domestic yields, and acquisition opportunities. Dole Food (DOLE) has been downgraded to Hold from Buy at Auriga. Jetblue Airways (JBLU) has been downgraded to Neutral from Buy at Sterne Agee. Dow components – Kraft (KFT) up 0.38, Coca Cola (KO) down 0.67%, Procter & Gamble (PG) down 0.31%, Wal-Mart (WMT) down 0.10%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.92 at 3:30 PM on Monday, down 0.32% on the day – up 4.40% year-to-date.

Health Care

Hologic (HOLX) has been upgraded to Overweight from Neutral by JP Morgan. St. Jude Medical (STJ) has been upgraded by Goldman Sachs giving the medical device maker a Buy from Neutral rating. Medivation (MDVN) has been added to Citigroup’s list of Top Picks. Vertex Pharmaceuticals (VRTX) has been upgraded to Overweight from Neutral at JP Morgan. Dow Components – Johnson & Johnson (JNJ) down 0.51%, Merck (MRK) up 0.76%, Pfizer (PFE) up 0.15.
The Health Care Select Sector SPDR (XLV) was trading at $36.89 at 3:30 PM on Monday, down 0.32% on the day – up 6.34% year-to-date.

Financials

Three JPMorgan (JPM) executives involved in the $2 billion trading loss will leave the bank this week, according to media reports. "The London Whale" will be stripped of trading duties. Fannie Mae had 114,157 single-family REO properties at the end of the first quarter, and almost half were considered unable to market because of delays in the appraisal process. Major Spanish banks move to comply with new rules. BBVA (BBVA) is setting aside provisions worth $2.3 billion to satisfy new capital requirements. Santander (STD) it will set aside an extra five billion euros to comply with the new rules. Dow Components – American Express (AXP) down 1.16%, Bank of America (BAC) down 0.66, JP Morgan Chase (JPM) down 1.87%, Travelers (TRV) up 0.22%.
The Financial Select Sector SPDR (XLF) was trading at $14.55 at 3:30 PM on Monday, down 1.76% on the day – up 11.92% year-to-date.

Information Technology

Yahoo (YHOO) confirmed that Scott Thompson is out as CEO, and will be replaced by Ross Levinsohn, while Fred Amoroso becomes Chairman of the Board. Apple (AAPL) continues its patent fight with Samsung accusing Samsung of destroying evidence. Hewlett Packard (HPQ) will re-enter the tablet market to take advantage of Microsoft's (MSFT) forthcoming Windows 8 platform. Teradata (TDC): Barclays takes the tech stock to Overweight from Equal Weight. Yandex (YNDX) has been upgraded to Neutral from Underweight at HSBC Securities. Symantec (SYMC) has been downgraded to Sell from Neutral at Goldman Sachs. Dow Components – Cisco Systems (CSCO) up 1.33%, Hewlett-Packard (HPQ) down 0.78, IBM (IBM) down 0.61, Intel Corp (INTC) down 1.92%, Microsoft (MSFT) down 0.90%.
The Technology Select Sector SPDR (XLK) was trading at $28.51 at 3:30 PM on Monday, down 0.63% on the day – up 12.02% year-to-date.

Telecommunication Services

Ciena (CIEN) shares surged after Verizon (VZ) said it is using Ciena’s technology as part of plans to build additional control panel technology into its network infrastructure. Nokia (NOK) has been downgraded to Sell from Hold at SocGen. Dow components – AT&T (T) down 0.89%, Verizon (VZ) down 1.06%.
The NASDAQ Telecommunications Index (IXTC) was trading at $186.12 at 3:30 PM on Monday, down 0.12% on the day – down 5.49% year-to-date.

Utilities

WGL Holdings (WGL) has been downgraded to Long-term Buy from Buy at Hilliard Lyons. Dominion Resources (D) up 0.19%, Edison International (EIX) flat, First Energy (FE) up 0.17%, PG&E Corp (PCG) flat, Southern Company (SO) flat.
The Utilities Select Sector SPDR (XLU) was trading at $35.84 at 3:30 PM on Monday, down 0.39% on the day – down 0.39% year-to-date.

STOCKS: CVX, XOM, CHK, MDR, CXO, IOC, SDRL, WLT, ACI, AA, DD, IAG, CBT, SLW, DAR, LPX, BA, CAT, GE, MMM, UTX, DHI,, LEN, PHM, TOL, MTH, RYL, MGA, DIS, HD, MCD, FRAN, GME, TUMI, KFT, KO, PG, WMT, AVP, VBOU, LCC, DOLE, JBLU, JNJ, MRK, PFE, HOLX, STJ, MDVN, CRTX, AXP, BAC, JPM, TRV, BBVA, STD, CSCO, HPQ, IBM, INTC, MSFT, YHOO, AAPL, TDC, YNDX, SYMC, T, VZ, CIEN, NOK, D, EIX, FE, PCG, SO, WGL

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
MMM 3M Company 203.53 -1.82 -0.89 1,838,640 Trade
SDRL Seadrill Limited (Bermuda) 0.28 0.00 0.90 6,063,375 Trade
PG Procter & Gamble Company (The) 92.47 0.40 0.43 6,803,763 Trade
GE General Electric Co 24.55 -0.20 -0.81 33,627,654 Trade
CVX Chevron Corporation 106.48 0.56 0.53 5,466,718 Trade
SO Southern Company (The) 48.30 0.38 0.79 4,852,965 Trade
PCG Pacific Gas & Electric Co. 69.14 0.16 0.23 2,069,248 Trade
BBVA Banco Bilbao Vizcaya Argentaria S.A. 8.78 0.07 0.80 2,871,198 Trade
YNDX Yandex N.V. 29.81 -0.53 -1.75 1,891,824 Trade
JNJ Johnson & Johnson 132.63 -0.41 -0.31 4,661,630 Trade
WMT Wal-Mart Stores Inc. 79.31 -0.39 -0.49 9,751,827 Trade
AA Alcoa Inc. 37.76 -0.04 -0.11 2,115,171 Trade
INTC Intel Corporation 35.01 -0.16 -0.45 16,229,460 Trade
IBM International Business Machines Corp 139.70 -1.00 -0.71 4,152,284 Trade
D Dominion Resources Inc. 78.69 0.57 0.73 2,303,023 Trade
TRV The Travelers Companies Inc. 127.89 -0.30 -0.23 1,246,905 Trade
IOC InterOil Corporation n/a n/a n/a 0 Trade
CBT Cabot Corporation 51.66 0.45 0.88 360,120 Trade
IAG Iamgold Corporation 5.70 0.03 0.53 7,293,658 Trade
UHT Universal Health Realty Income Trust 74.49 0.38 0.51 74,772 Trade
AAPL Apple Inc. 157.50 -0.36 -0.23 27,401,296 Trade
WGL WGL Holdings IncCommon Stock 83.57 -0.13 -0.16 256,073 Trade
EIX Edison International 78.94 -0.07 -0.09 3,203,846 Trade
MTH Meritage Homes Corporation 42.10 -0.45 -1.06 317,304 Trade
JPM JP Morgan Chase 90.74 0.09 0.10 12,936,296 Trade
AXP American Express Company 85.38 -0.71 -0.82 4,165,069 Trade
DAR Darling Ingredients Inc. 15.60 -0.23 -1.45 1,251,490 Trade
UTX United Technologies Corporation 115.48 -0.62 -0.53 2,760,446 Trade
TOL Toll Brothers Inc. 38.15 -0.48 -1.24 2,153,776 Trade
AVP Avon Products Inc. 2.62 -0.01 -0.38 4,220,427 Trade
HOLX Hologic Inc. 37.42 -0.53 -1.40 3,632,398 Trade
SYMC Symantec Corporation 28.45 0.41 1.46 7,202,238 Trade
CSCO Cisco Systems Inc. 30.37 -0.67 -2.16 34,797,761 Trade
DIS Walt Disney Company (The) 100.70 -0.68 -0.67 6,893,672 Trade
JBLU JetBlue Airways Corporation 20.28 -0.21 -1.02 5,205,708 Trade
MDR McDermott International Inc. 5.75 0.06 1.05 2,883,405 Trade
MDVN Medivation Inc. n/a n/a n/a 0 Trade
VZ Verizon Communications Inc. 47.69 -0.20 -0.42 16,918,985 Trade
TDC Teradata Corporation 30.08 -0.20 -0.66 1,662,584 Trade
BAC Bank of America Corporation 23.62 -0.02 -0.08 60,261,901 Trade
NOK Nokia Corporation Sponsored American Depositary Sh 6.19 -0.06 -0.96 10,104,308 Trade
MCD McDonald\'s Corporation 157.76 -0.13 -0.08 2,595,670 Trade
DHI D.R. Horton Inc. 35.69 -0.36 -1.00 2,609,100 Trade
CIEN Ciena Corporation 23.37 -0.14 -0.60 1,884,343 Trade
DD E.I. du Pont de Nemours and Co. 81.18 0.32 0.40 1,952,437 Trade
GME Gamestop Corporation 21.22 0.12 0.57 2,123,458 Trade
MGA Magna International Inc. 46.10 -0.52 -1.12 1,753,701 Trade
STJ St. Jude Medical Inc. n/a n/a n/a 0 Trade
LEN Lennar Corporation Class A 51.88 -1.00 -1.89 1,758,110 Trade
FRAN Francesca\'s Holdings Corporation 7.98 -0.03 -0.37 2,166,343 Trade
HD Home Depot Inc. (The) 147.49 -2.18 -1.46 6,845,826 Trade
XOM Exxon Mobil Corporation 76.64 0.38 0.50 13,539,465 Trade
PFE Pfizer Inc. 32.67 -0.28 -0.85 15,340,533 Trade
CXO Concho Resources Inc. 108.52 0.47 0.43 995,142 Trade
PHM PulteGroup Inc. 25.28 -0.16 -0.63 3,649,662 Trade
HPQ HP Inc. 18.51 -0.13 -0.70 11,686,871 Trade
BA Boeing Company (The) 235.77 0.18 0.08 2,939,308 Trade
YHOO Yahoo! Inc. n/a n/a n/a 0 Trade
ACI Arch Coal Inc. n/a n/a n/a 0 Trade
MRK Merck & Company Inc. (new) 61.49 -0.35 -0.57 8,421,089 Trade
FE FirstEnergy Corporation 32.83 0.18 0.55 3,306,015 Trade
LPX Louisiana-Pacific Corporation 24.08 0.36 1.52 2,082,900 Trade
SLW Silver Wheaton Corp (Canada) n/a n/a n/a n/a
KO Coca-Cola Company (The) 45.67 -0.19 -0.41 10,877,094 Trade
T AT&T Inc. 37.37 -0.23 -0.61 23,007,117 Trade
CAT Caterpillar Inc. 113.92 0.78 0.69 3,873,072 Trade
MSFT Microsoft Corporation 72.49 0.09 0.12 18,760,989 Trade
CHK Chesapeake Energy Corporation 3.96 0.08 2.06 35,119,720 Trade

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