Personal Income came in slightly weaker than expected in July rising by 0.3%, while spending rose a slightly more than expected 0.8% at the expense of a reduced savings rate. Pending Home Sales fell 1.3% in July. The Dow Jones Industrial Average traded significantly higher and moved above its August 17th high at 11,529.67 in the final half hour of trading. The August 9th low was 10,604.07. The NASDAQ opened at 2510.13 and traded above its August 15th high at 2555.20 in the final half hour of trading. The August 9th low was 2331.65.
Asian stocks traded higher on Monday with the Nikkei 225 up 0.61% to 8,851 and the Hang Seng rebounding by 1.44% to 19,865. In Europe, the UK market was closed and the other averages moved higher with the DAX surging 2.39% to 5,670 and the CAC 40 jumping 2.16% to 3,154. The yield on the 10-Year US Treasury rose from 2.190 to 2.298 as the flight to quality eased. Gold continued to recover from last Thursday’s low at $1705.4 the Troy ounce trading as high as $1841.5 on Monday morning then tumbled to a day’s low at $1778.1 into the final hour of trading. Crude oil traded up from $85.11 per barrel to $87.62 staying above its 200-week simple moving average at $83.85. The euro versus the U.S. dollar traded up from 1.4469 to 1.4547.
Energy
In afternoon trading: Shares of Willbros Group (WG) are up about 14.5%. Shares of Dresser Rand Group (DRC) are up about 12.25%. Shares of Cal Dive International (DVR) are up about 11.75%. Shares of Magnum Hunter Resources (MHR) are up about 10.75%. Shares of North American Energy Partners (NOA) are up about 9.5%. Shares of Stone Energy (SGY) are up about 9%. Shares of Rosetta Resources (ROSE) are up about 8.5%. Shares of Petroleum Development (PETD) are up about 8.5%. Shares of Overseas Shipholding Group (OSG) are up about 8.25%.
Energy Select Sector SPDR (XLE) was trading at $67.73 at 4:00 PM on Monday, up 2.92% on the day – down 0.76% year-to-date.
Materials
AuRico Gold (AUQ) has agreed to buy Northgate Minerals (NXG) for C$1.46B ($1.48B) in a deal that will create an intermediate gold company. Following the drama on Friday in which Canadian regulators published and later rescinded an order for the resignation of Sino-Forest’s (SNOFF) senior management, company CEO Allen Chan has stepped down, three other employees have been temporarily suspended, and the company’s stock has been suspended. Shares of Sino-Forest are down about 72%. In afternoon trading: Shares of AuRico Gold are down about 19.25%, while shares of Northgate Minerals are up about 26.75%. Shares of United States Steel (X) are up about 8.5%. Shares of LyondellBasell Industries (LYB) are up about 8.25%.
The Materials Select Sector SPDR (XLB) was trading at $34.96 at 4:00 PM on Monday, up 3.02% on the day – down 9.00% year-to-date.
Industrials
Boeing’s (BA) board could decide today to upgrade the 737 with more fuel-efficient engines rather than wait to develop an all-new single-aisle jet, which wouldn’t be ready until the end of the decade. Instead, the refurbished version would enter service mid-decade and around the same time as Airbus’ (EADSF) successful A320neo. AMR Corp (AMR) is lifted to Hold from Sell at Ticonderoga. Granite Constrction (GVA) gets a Buy-from-Hold boost at BB&T Capital. Barnes Group (B) is lifted to Buy from Hold at BB&T Capital. Insituform Tech (INSU) is now Buy from Neutral at Janney. Robert Half International (RHI) is reduced to Hold from Buy at Citigroup. Broadwind Energy (BWEN) is now Neutral from Outperform at Macquarie. In afternoon trading: Shares of Harbin Electric (HRBN) are up about 12.5%. Shares of Meritor (MTOR) are up about 12%. Shares of Mueller Water Products (MWA) are up about 11.75%. Shares of Manitowoc (MTW) are up about 10.5%. Shares of DryShips (DRYS) are up about 10.5%. Shares of USG Corp (USG) are up about 10%.
The Industrial Select Sector SPDR (XLI) was trading at $31.91 at 4:00 PM on Monday, up 3.17% on the day – down 8.49% year-to-date.
Consumer Discretionary
Skullcandy (SKUL) is begun with a Buy at both Jefferies and KeyBanc, and assigned an equally bullish Overweight at Piper Jaffray. O’Reilly Automotive (ORLY) is hoisted to Hold from Sell at ISI Group. In afternoon trading: Shares of Build-A-Bear (BBW) are up about 14.25%. Shares of Orbitz Worldwide (OWW) are up about 13%. Shares of Kenneth Cole (KCP) are up about 12.75%. Shares of Morgans Hotel Group (MHGC) are up about 10.25%. Shares of Imax Corp (IMAX) are up about 10%. Shares of LaSalle Hotel Properties (LHO) are up about 9.75%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $37.17 at 4:00 PM on Monday, up 2.91% on the day – down 0.64% year-to-date.
Consumer Staples
In afternoon trading: Shares of Central European Distribution (CEDC) are up about 36.75%. Shares of Star Scientific (CIGX) are up about 36.5%. Shares of Winn-Dixie (WINN) are up about 14.75%. Shares of Spartan Stores (SPTN) are up about 12.25%. Shares of Framer Brothers (FARM) are up about 9.75%. Shares of Ingles Markets (IMKTA) are up about 9.25%. Shares of Zhongpin (HOGS) are up about 8.5%. Shares of Dole Food Company (DOLE) are up about 7.75%. Shares of Pilgrim’s Pride (PPC) are up about 7.5%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $30.71 at 4:00 PM on Monday, up 1.79% on the day – up 4.78% year-to-date.
Healthcare
Eliquis, a drug from Bristol-Myers (BMY) and Pfizer (PFE), significantly outperformed half-century-old warfarin in a stroke-prevention study of 18,201 patients. Eliquis reduced the risk of stroke in patients with atrial fibrillation 21%, lowered the incidence of bleeding 31%, and cut the risk of death 11%. The FDA has approved Pfizer’s (PFE) Crizotinib, which shrinks tumors in lung-cancer patients with a rare genetic abnormality. Crizotinib is the latest treatment using molecular targeting to win rapid approval from the agency, and patients will be identified with a test made by Abbott Laboratories (ABT). Pharmacyclics (PCYC) are initiated with an Outperform at Leerink Swann. In afternoon trading: Shares of Gentiva Health Services (GTIV) are up about 14%. Shares of Pacific Biosciences of California (PACB) are up about 11.5%. Shares of Depomed (DEPO) are up about 11.25%.
The Health Care Select Sector SPDR (XLV) was trading at $33.06 at 4:00 PM on Monday, up 2.54% on the day – up 4.95% year-to-date.
Financials
Greece’s Eurobank (EGFEF) and Alpha Bank (ALBKY) are set to today announce a merger and a joint capital raising of €1.75B ($2.54B). Wells Fargo (WFC), JPMorgan (JPM) and Lone Star have reportedly won final bids for Anglo Irish Bank’s $9.65B portfolio of U.S. commercial real-estate loans, with the winning offers averaging about $0.80 on the dollar. IntercontinentalExchange (ICE) is increased 180 degrees, to Outperform from Underperform, at Credit Agricole. In afternoon trading: Shares of Alpha Bank are up about 51.25%. Shares of MGIC Investment (MTG) are up about 16.75%. Shares of Radian Group (RDN) are up about 16.5%. Shares of RAIT Financial (RAS) are up about 14.25%. Shares of Hartford Financial Services (HIG) are up about 12.25%.
The Financial Select Sector SPDR (XLF) was trading at $13.30 at 4:00 PM on Monday, up 4.15% on the day – down 16.61% year-to-date.
Information Technology
Zillow (Z) is begun with a Buy at Citigroup. Meanwhile, Thinkequity rolls out Hold coverage. Mitek Systems (MITK) is a new Outperform at Brokerage William Blair. In afternoon trading: Shares of Motricity (MOTR) are up about 21.5%. Shares of Ciena Corp (CIEN) are up about 12%. Shares of Travelzoo (TZOO) are up about 11%. Shares of NeoPhotonics (NPTN) are up about 11%. Shares of Oclaro (OCLR) are up about 10.25%. Shares of Magma Design (LAVA) are up about 10.25%. Shares of Powerwave Tech (PWAV) are up about 10%. Shares of JDS Uniphase (JDSU) are up about 10%.
The Technology Select Sector SPDR (XLK) was trading at $24.40 at 4:00 PM on Monday, up 2.52% on the day – down 3.14% year-to-date.
Telecommunications Services
In afternoon trading: Shares of Towerstream (TWER) are up about 16.25%. Shares of Premiere Global Services (PGI) are up about 12%. Shares of Level 3 Communications (LVLT) are up about 7%. Shares of Cincinnati Bell (CBB) are up about 6%. Shares of Clearwire (CLWR) are up about 5.5%. Shares of Telcomunicacoes de Sao Paulo (VIV) are up about 5%. Shares of Leap Wireless (LEAP) are up about 5%. Shares of Sprint Nextel (S) are up about 5%.
The NASDAQ Telecommunications Index (IXTC) was trading at $191.99 at 4:00 PM on Monday, up 3.72% on the day – down 14.81% year-to-date.
Utilities
In afternoon trading: Shares of Tri-Tech Holding (TRIT) are up about 9%. Shares of Dynegy (DYN) are up about 7%. Shares of Veolia Environment (VE) are up about 6.25%. Shares of Huaneng Power International (HNP) are up about 6%. Shares of Ferrellgas Partners (FGP) are up about 5.5%. Shares of Genon Energy (GEN) are up about 4.75%. Shares of AES Corp (AES) are up about 4.75%.
The Utilities Select Sector SPDR (XLU) was trading at $33.66 at 4:00 PM on Monday, up 1.98% on the day – up 7.39% year-to-date.
STOCKS: WG, DRC, DVR, MHR, NOA, SGY, ROSE, PETD, OSG, AUQ, NXG, SNOFF, X, LYB, BA, EADSF, AMR, GVA, B, INSU, RHI, BWEN, HRBN, MTOR, MWA, MTW, DRYS, USG, SKUL, ORLY, BBW, OWW, KCP, MHGC, IMAX, LHO, CEDC, CIGX, WINN, SPTN, FARM, IMKTA, HOGS, DOLE, PPC, BMY, PFE, ABT, PCYC, GTIV, PACB, DEPO, EGFEF, ALBKY, WFC, JPM, ICE, MTG, RDN, RAS, HIG, Z, MITK, MOTR, CIEN, TZOO, NPTN, OCLR, LAVA, PWAV, JDSU, TWER, PGI, LVLT, CBB, CLWR, VIV, LEAP, S, TRIT, DYN, VE, HNP, FGP, GEN, AES
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