Equities Sector Coverage: Tech's Disappointments Drag Stocks

Sector Recap |

Tech's Disappointments Drag StocksThe Dow Jones Industrial Average declined to 13,027.49 on Wednesday still above its 50-day simple moving average at 13,002. The NASDAQ’s declined to 3023.91 then rebounded to 3045.04 then consolidated staying above its 50-day simple moving average at 3005.

Asian stocks were higher on Wednesday. The Nikkei 225 ended their session at 9,667 – up 2.14% on the day. The Hang Seng ended their session at 20,781 – down 1.06% on the day. European stocks traded lower on Wednesday. The FTSE 100 ended their session at 5,745 – down 0.38% on the day. The DAX ended their session at 6,732 – down 1.01% on the day. The CAC 40 ended their session at 3,240 – down 1.59% on the day. The yield on the 10-Year US Treasury declined from 2.017 percent to 1.968 below its 50-day and 200-day simple moving averages at 2.084 and 2.121.

Gold declined from $1655.2 the Troy ounce to $1638.1 staying below the “death cross” defined by the 50-day simple moving average at $1690.9 being below the 200-day simple moving averages at $1694.2. Crude oil declined from $104.51 per barrel to $102.19, staying below its 50-day simple moving average at $104.64. The euro versus the dollar traded down from 1.3139 to 1.3061 below its 50-day simple moving average at 1.3205.

Energy

Halliburton (HAL) beat Q1 EPS by three cents with in-line revenue. Bank of America-Merrill Lynch initiated Buy ratings on Peabody Energy (BTU), Walter Energy (WLT), and Alpha Natural Resources (ANR), and initiates Underperform ratings on Arch Coal (ACI) and Consol Energy (CNX). Energy Transfer Partners (ETP) is initiated with a Neutral rating at Goldman Sachs. CNOOC Ltd (CEO), China’s state oil giant has been upgraded to Hold from Underperform at Jefferies. First Solar (FSLR) has been upgraded to Hold from Sell at Cantor Fitzgerald with a price target at $21.50. First Solar (FSLR) has also been downgraded to Sell from Hold with Wunderlich, whose target is taken down to $14 from $38. Mid-Con Energy Partners (MCEP) have been upgraded to Outperform from Neutral with a $24 price target at Robert W. Baird. Patriot Coal (PCX) has been upgraded to Equal Weight from Underweight at Morgan Stanley. Dow components - Chevron (CVX) rose by 0.2% Wednesday morning with Exxon Mobil (XOM) up 0.5%.

Energy Select Sector SPDR (XLE) was trading at $69.31 at 3:30 PM on Wednesday, down 0.06% on the day – up 0.26% year-to-date.

Materials

With gold trading under a 50-day / 200-day “death cross” after having a positive moving average configuration since February 13, 2009, gold shares slipped on Wednesday; Barrick Gold (ABX) was down 0.6% in morning trading with Newmont Mining (NEM) down 1.1%. Dow components - Alcoa (AA) continues to have problems trending above the $10 threshold slipping 0.3%. DuPont (DD) was up 0.3% ahead of Thursday’s earnings report.

The Materials Select Sector SPDR (XLB) was trading at $36.66 at 3:30 PM on Wednesday, down 0.19% on the day – up 9.43% year-to-date.

Industrials

Dover (DOV) beat Q1 EPS estimates by three cents with in-line revenue. Textron (TXT) beat Q1 EPS estimates by six cents and also beat on the revenue line. Packaging of America (PKG) beat Q1 EPS estimates by two cents and also beat on the revenue line. United Rentals (URI) beat Q1 EPS estimates, swinging to a profit as rental volumes and rates continue to improve despite a weak construction market. CSX (CSX) beat Q1 EPS estimates by a nickel and also beat on the revenue line. Acuity Brands (AYI), the lighting company is initiated with an Overweight rating at Piper Jaffray. C.H. Robinson (CHRW) has been upgraded to Buy from Hold at Deutsche Bank with a $79 price target. Dun & Bradstreet (DNB) has been downgraded to Underperform from Neutral at JPMorgan. Toll Brothers (TOL) and Lennar (LEN) have been downgraded to Neutral from Positive at Susquehanna. Dow components - Boeing Co (BA) lost 0.2%, Caterpillar (CAT) was up 0.7%, General Electric (GE) lost 1.0%, 3M Company (MMM) was lower by 0.2%, and United Technologies (UTX) slipped 0.2% in morning trading.

The Industrial Select Sector SPDR (XLI) was trading at $36.92 at 3:30 PM on Wednesday, down 0.30% on the day – up 9.39% year-to-date.

Consumer Discretionary

Amazon (AMZN) has acquired the exclusive North American rights to publish the James Bond spy titles in both print and digital form. Polaris Industries (PII) beat Q1 EPS estimates by eight cents and also beat on the revenue line. McDonald’s (MCD) has been upgraded to Buy from Hold at Edward Jones. CTC Media (CTCM) has been downgraded to Underweight from Neutral at JPMorgan. Dow Components - Disney (DIS) lost 0.4%, and McDonalds (MCD) picked up 0.5%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $45.00 at 3:30 PM on Wednesday, up 0.26% on the day – up 15.33% year-to-date.



Consumer Staples

Carlsberg (CABGY), the Danish brewer has been upgraded to Buy from Neutral at Bank of America-Merrill Lynch. Danone (DANOY), the French yogurt firm has been upgraded to Buy from Neutral at Citigroup. Deckers Outdoor (DECK), the maker of Uggs has been upgraded to Neutral from Underperform at Sterne Agee. Dow components - Home Depot (HD) lost 0.7%, Kraft (KFT) slipped 0.4%, Coca Cola (KO) was flat, Procter & Gamble (PG) was also flat, and Wal-Mart (WMT) gained just 0.1% in morning trading.

The Consumer Staples Select Sector SPDR (XLP) was trading at $34.12 at 3:30 PM on Wednesday, up 0.16% on the day – up 5.02% year-to-date.

Health Care

Pfizer (PFE) is reportedly closing in on a deal to sell its infant nutrition business to Nestle (NSRGY.PK) for at least $9 billion, which was the winning bid. SXC Health (SXCI) will buy Catalyst Health (CHSI) for about $4.4 billion in cash and stock. The $81.02 share price represents a premium of roughly 28% to CHSI Tuesday closing price. Illumina (ILMN) at its annual meeting today will attempt to fend off Roche's (RHHBY.PK) $6.7 billion offer for the company. Abbott Laboratories (ABT) beat Q1 EPS estimates by three cents and also beat on the revenue line. St. Jude Medical (STJ) beat Q1 EPS estimates by three cents with in-line revenue. Quest Diagnostics (DGX) beat Q1 EPS estimates by six cents and also beat on the revenue line. Intuitive Surgical (ISRG) beat Q1 EPS estimates by 35 cents with a beat on the revenue line. Dow Components - Johnson & Johnson (JNJ) lost 1.4%, Merck (MRK) slipped by just 0.1%, and Pfizer (PFE) gained 1.1% in morning trading.

The Health Care Select Sector SPDR (XLV) was trading at $37.08 at 3:30 PM on Wednesday, down 0.13% on the day – up 6.89% year-to-date.

Financials

New York Community Bancorp (NYB) beat Q1 EPS estimates by a penny. Piper Jaffray Companies (PJC) reported Q1 EPS of $0.33 with a slight beat on the revenue line. Southwest Bancorp (OKSB) reported Q1 EPS of $0.21, which may not be comparable to consensus calling for a loss of $0.01. Bank of New York Mellon (BK) reported Q1 EPS that was in-line. with estimates on both the top and bottom line. PNC Financial Services (PNC) reported Q1 EPS of $1.44 with a beat on the revenue line. Virginia Commerce Bancorp (VCBI) missed Q1 EPS estimates by three cents. Huntington Bancshares (HBAN) beat Q1 EPS estimates by three cents. American International Group (AIG) has been upgraded to Outperform from Market Perform at William Blair. Comerica (CMA) has been downgraded to Market Perform fro Outperform at BMO Capital. Dow Components - American Express (AXP) gained 0.3%, Bank of America (BAC) gained just 0.2%, JP Morgan (JPM) fell by 0.7%, and Travelers (TRV) was down 0.6% in morning trading.

The Financial Select Sector SPDR (XLF) was trading at $15.34 at 3:30 PM on Wednesday, down 0.65% on the day – up 18.00% year-to-date.

Information Technology

IBM's (IBM) reported a Q1 EPS beat of 37 cents but missed on the revenue line and shares were down 1.9% in pre-market trading. International Business Machines (IBM) has been downgraded to Neutral from Outperform at Macquarie after last night’s earnings announcement. Intel (INTC) beat expectations in Q1 as EPS fell to $0.53 from $0.56 a year earlier. INTC revenue was flat and shares slipped in pre-market trading. Yahoo (YHOO) shares were up 3.4% premarket after its Q1 results topped forecasts as EPS rose to 24 cents per share from 17 cents. Yahoo’s display and search ad revenues continuing to decline however. Yahoo (YHOO) have been downgraded to Sector Perform from Outperform at Pacific Crest. Google (GOOG) plans to divest Motorola's (MMI) set-top box business and promises to keep Motorola's phone business at arm's length. Apple's (AAPL) and Samsung's (SSNLF.PK) CEOs will participate in a patent settlement conference overseen by a U.S. Magistrate Judge. Amazon (AMZN) has acquired the exclusive North American rights to publish the James Bond spy titles in both print and digital form. Cree Inc (CREE) has been downgraded to Hold from Buy at ThinkEquity. Dow Components - Cisco Systems (CSCO) lost 0.8%, Hewlett-Packard (HPQ) was up 0.6%, IBM (IBM) slumped 2.8%, Intel Corp (INTC) fell by 2.0%, and Microsoft (MSFT) lost 1.0% in morning trading.

The Technology Select Sector SPDR (XLK) was trading at $29.73 at 3:30 PM on Wednesday, down 0.70% on the day – up 16.82% year-to-date.

Telecommunication Services

Telecom Argentina (TEO) has been upgraded to Buy from Hold at Deutsche. Clearwire Corp (CLWR) fell by 12.2%. Dow components - AT&T (T) lost 0.6% while Verizon (VZ) slipped 0.3%.

The NASDAQ Telecommunications Index (IXTC) was trading at $210.90 at 3:30 PM on Wednesday, down 0.50% on the day – up 7.09% year-to-date.

Utilities

Telecom Argentina (TEO) has been upgraded to Buy from Hold at Deutsche. Dominion Resources (D) lost 0.5%, Edison International (EIX) fell 0.6%, First Energy (FE) slipped by 0.2%, and PG&E Corp (PCG) was flat in morning trading.

The Utilities Select Sector SPDR (XLU) was trading at $34.78 at 3:30 PM on Wednesday, down 0.14% on the day – down 3.34% year-to-date.

STOCKS: CVX, XOM, HAL, BTU, WLT, ANR, ACI, CNX, ETP, CEO, FSLR, MCEP, PCX, AA, DD, ABX, NEM, BA, CAT, GE, MMM, UTX, DOV, TXT, PKG, URI, CSX, AYI, CHRW, DNB, TOL, LEN, DIS, MCD, AMZN, PII, CTCM, HD, KFT, KO, PG, WMT, CABGY, DANOY, DECK, JNJ, MRK, PFE, NSRGY.PK, CHSI, ILMN, RHHBY.PK, ABT, STJ, DGX, ISRG, AXP, BAC, JPM, TRV, NYB, PJC, OKSB, BK, PNC, VCBI, HBAN, AIG, CMA, CSCO, HPQ, IBM, INTC, MSFT, YHOO, GOOG, MMI, AAPL, SSNLF.PK, AMZN, CREE, T, VZ, TEO, CLWR, D, EIX, FE, PCG, PGN

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
AYI Acuity Brands Inc (Holding Company) 160.90 -0.04 -0.02 544,222 Trade
CEO CNOOC Limited 127.19 -0.42 -0.33 113,436 Trade
MMM 3M Company 221.32 2.08 0.95 1,647,816 Trade
DNB Dun & Bradstreet Corporation (The) 118.13 -0.08 -0.07 210,512 Trade
PGN Paragon Offshore plc n/a n/a n/a 0
DECK Deckers Outdoor Corporation 66.09 1.29 1.99 431,501 Trade
PG Procter & Gamble Company (The) 88.25 -3.34 -3.65 19,997,800 Trade
GE General Electric Co 23.83 0.25 1.06 192,404,370 Trade
CVX Chevron Corporation 118.64 0.44 0.37 4,924,257 Trade
ABT Abbott Laboratories 56.32 0.32 0.57 5,528,681 Trade
PCG Pacific Gas & Electric Co. 57.86 0.86 1.51 7,758,334 Trade
MCEP Mid-Con Energy Partners LP 1.02 0.02 2.00 9,447 Trade
PKG Packaging Corporation of America 118.36 1.76 1.51 596,410 Trade
JNJ Johnson & Johnson 142.40 0.36 0.25 5,634,523 Trade
WMT Wal-Mart Stores Inc. 87.44 1.04 1.20 7,617,753 Trade
AA Alcoa Inc. 47.93 1.39 2.99 4,209,075 Trade
CSX CSX Corporation 54.52 0.46 0.85 6,114,424 Trade
INTC Intel Corporation 40.43 0.34 0.85 18,335,672 Trade
IBM International Business Machines Corp 162.07 1.17 0.73 7,868,803 Trade
D Dominion Resources Inc. 80.00 0.05 0.06 2,198,168 Trade
TRV The Travelers Companies Inc. 133.32 0.15 0.11 1,838,805 Trade
PNC PNC Financial Services Group Inc. (The) 136.95 1.65 1.22 2,081,042 Trade
ANT18A Abbey National Treasury Services PLC 2.000% Notes n/a n/a n/a 0 Trade
AAPL Apple Inc. 156.25 0.27 0.17 23,974,146 Trade
EIX Edison International 79.60 0.13 0.16 1,795,688 Trade
PII Polaris Industries Inc. 106.46 1.10 1.04 636,437 Trade
JPM JP Morgan Chase 99.51 1.40 1.43 15,326,608 Trade
AXP American Express Company 92.09 0.19 0.21 4,442,193 Trade
URI United Rentals Inc. 144.40 0.00 0.00 2,525,019 Trade
UTX United Technologies Corporation 120.93 1.44 1.21 2,514,652 Trade
TOL Toll Brothers Inc. 44.21 0.25 0.57 1,345,427 Trade
AMZN Amazon.com Inc. 982.91 -3.70 -0.38 2,365,122 Trade
CSCO Cisco Systems Inc. 34.25 0.50 1.48 24,361,352 Trade
DIS Walt Disney Company (The) 99.40 0.39 0.39 5,938,716 Trade
CHRW C.H. Robinson Worldwide Inc. 78.30 0.32 0.41 1,471,007 Trade
BTU Peabody Energy Corp 29.96 0.64 2.18 1,289,209 Trade
VZ Verizon Communications Inc. 49.53 0.32 0.65 16,259,580 Trade
HBAN Huntington Bancshares Incorporated 14.19 0.21 1.50 8,030,500 Trade
ABX Barrick Gold Corporation 16.03 -0.07 -0.43 8,863,488 Trade
BAC Bank of America Corporation 27.17 0.59 2.22 83,764,655 Trade
GOOG Alphabet Inc. 988.20 3.75 0.38 1,183,186 Trade
ILMN Illumina Inc. 209.88 4.70 2.29 727,020 Trade
MCD McDonald\'s Corporation 166.30 -0.20 -0.12 5,577,713 Trade
BK Bank of New York Mellon Corporation (The) 53.12 0.27 0.51 6,977,814 Trade
DD E.I. du Pont de Nemours and Co. 83.93 0.00 0.00 0 Trade
DGX Quest Diagnostics Incorporated 95.08 1.85 1.98 1,807,088 Trade
CNX CONSOL Energy Inc. 15.88 0.06 0.38 3,989,061 Trade
TEO Telecom Argentina SA 31.70 -0.44 -1.37 214,912 Trade
STJ St. Jude Medical Inc. n/a n/a n/a 0 Trade
CMA Comerica Incorporated 79.07 1.59 2.05 2,181,456 Trade
OKSB Southwest Bancorp Inc. 28.45 0.00 0.00 0 Trade
LEN Lennar Corporation Class A 57.50 0.75 1.32 2,366,381 Trade
CTCM CTC Media Inc n/a n/a n/a 0 Trade
HD Home Depot Inc. (The) 163.43 0.19 0.12 4,166,481 Trade
XOM Exxon Mobil Corporation 83.11 0.37 0.45 9,574,086 Trade
PFE Pfizer Inc. 36.42 0.18 0.50 17,502,245 Trade
FSLR First Solar Inc. 47.73 0.09 0.19 1,396,640 Trade
AIG American International Group Inc. New 64.87 -0.20 -0.31 6,871,243 Trade
HPQ HP Inc. 22.02 0.06 0.27 8,621,009 Trade
BA Boeing Company (The) 264.75 5.71 2.20 3,955,922 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) 63.88 0.13 0.20 10,304,201 Trade
FE FirstEnergy Corporation 32.13 -0.17 -0.53 3,054,639 Trade
KO Coca-Cola Company (The) 46.38 -0.21 -0.45 9,646,790 Trade
T AT&T Inc. 35.54 -0.15 -0.42 37,835,452 Trade
PJC Piper Jaffray Companies 63.00 0.05 0.08 77,432 Trade
CAT Caterpillar Inc. 131.36 0.59 0.45 3,086,775 Trade
HAL Halliburton Company 43.33 -0.09 -0.21 10,522,555 Trade
NEM Newmont Mining Corporation 37.79 -0.05 -0.13 3,477,638 Trade
CREE Cree Inc. 33.85 -0.33 -0.97 2,701,670 Trade
ISRG Intuitive Surgical Inc. 369.58 12.12 3.39 2,021,021 Trade
DOV Dover Corporation 94.95 5.45 6.09 2,931,608 Trade
MMI Marcus & Millichap Inc. 27.41 0.20 0.74 78,984 Trade
MSFT Microsoft Corporation 78.81 0.90 1.16 22,866,426 Trade
TXT Textron Inc. 53.74 0.64 1.21 3,015,183 Trade

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