Equities Sector Coverage: Tech's Disappointments Drag Stocks

Sector Recap  |

The 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) 124.07 -0.48 -0.39 475,355 Trade
CEO CNOOC Limited 164.77 1.65 1.01 158,698 Trade
MMM 3M Company 198.06 -0.31 -0.16 2,797,664 Trade
DNB Dun & Bradstreet Corporation (The) 141.77 0.02 0.01 434,709 Trade
PGN Paragon Offshore n/a n/a n/a 0
DECK Deckers Outdoor Corporation 129.92 -0.75 -0.57 662,292 Trade
PG Procter & Gamble Company (The) 93.49 0.02 0.02 11,622,993 Trade
GE General Electric Company 8.32 -0.29 -3.37 170,169,781 Trade
CVX Chevron Corporation 115.72 0.37 0.32 6,783,523 Trade
ABT Abbott Laboratories 69.41 -0.08 -0.12 5,400,837 Trade
PCG Pacific Gas & Electric Co. 25.59 -7.13 -21.79 53,543,077 Trade
MCEP Mid-Con Energy Partners LP 1.11 0.00 0.00 28,537 Trade
PKG Packaging Corporation of America 95.34 -0.10 -0.10 639,260 Trade
JNJ Johnson & Johnson 144.25 -0.43 -0.30 6,433,077 Trade
WMT Walmart Inc. 101.53 -1.41 -1.37 10,481,867 Trade
AA Alcoa Corporation 35.15 0.43 1.24 2,872,968 Trade
CSX CSX Corporation 70.50 0.22 0.31 5,576,338 Trade
INTC Intel Corporation 47.09 -0.30 -0.63 25,632,731 Trade
IBM International Business Machines Corporation 120.20 -0.64 -0.53 4,762,275 Trade
D Dominion Energy Inc. 73.65 -0.37 -0.50 4,401,139 Trade
TRV The Travelers Companies Inc. 123.04 -3.77 -2.97 3,153,407 Trade
PNC PNC Financial Services Group Inc. (The) 134.13 -1.46 -1.08 3,314,574 Trade
ANT18A Abbey National Treasury Services PLC 2.000% Notes 2018 n/a n/a n/a 0 Trade
AAPL Apple Inc. 186.80 -5.43 -2.82 60,800,957 Trade
EIX Edison International 53.87 -1.67 -3.01 11,277,027 Trade
PII Polaris Industries Inc. 93.27 1.30 1.41 401,220 Trade
JPM JP Morgan Chase & Co. 107.33 -2.26 -2.06 18,361,433 Trade
AXP American Express Company 107.77 -0.09 -0.08 4,978,112 Trade
URI United Rentals Inc. 119.69 0.12 0.10 1,660,943 Trade
UTX United Technologies Corporation 128.89 -0.23 -0.18 5,749,783 Trade
TOL Toll Brothers Inc. 31.83 -0.50 -1.55 3,118,715 Trade
AMZN Amazon.com Inc. 1,599.01 -32.16 -1.97 6,486,891 Trade
CSCO Cisco Systems Inc. 44.33 -0.79 -1.75 36,613,496 Trade
DIS The Walt Disney Company 117.12 0.27 0.23 7,109,122 Trade
CHRW C.H. Robinson Worldwide Inc. 90.00 1.81 2.05 1,249,274 Trade
BTU Peabody Energy Corporation 35.70 -0.60 -1.65 787,139 Trade
VZ Verizon Communications Inc. 58.94 0.28 0.48 18,288,710 Trade
HBAN Huntington Bancshares Incorporated 14.46 -0.17 -1.16 14,181,014 Trade
ABX Barrick Gold Corporation 12.71 0.28 2.25 16,586,454 Trade
BAC Bank of America Corporation 27.21 -0.55 -1.98 69,213,341 Trade
GOOG Alphabet Inc. 1,043.66 7.61 0.73 1,565,945 Trade
ILMN Illumina Inc. 308.23 -2.95 -0.95 753,657 Trade
MCD McDonald's Corporation 183.85 -0.16 -0.09 3,407,486 Trade
BK Bank of New York Mellon Corporation (The) 48.23 0.03 0.06 6,616,579 Trade
DGX Quest Diagnostics Incorporated 94.71 -0.33 -0.35 948,396 Trade
CNX CNX Resources Corporation 14.59 -0.70 -4.58 4,367,244 Trade
TEO Telecom Argentina SA 17.64 0.72 4.26 269,302 Trade
STJ St. Jude Medical Inc. n/a n/a n/a 0 Trade
CMA Comerica Incorporated 80.71 -2.05 -2.48 2,100,359 Trade
LEN Lennar Corporation Class A 41.61 0.35 0.85 4,400,678 Trade
CTCM CTC Media Inc n/a n/a n/a 0 Trade
HD Home Depot Inc. (The) 179.90 0.90 0.50 7,561,076 Trade
XOM Exxon Mobil Corporation 77.39 -0.61 -0.78 18,552,107 Trade
PFE Pfizer Inc. 42.91 -0.61 -1.40 26,943,898 Trade
FSLR First Solar Inc. 42.54 0.09 0.21 1,882,868 Trade
AIG American International Group Inc. 41.94 -0.22 -0.52 9,771,499 Trade
HPQ HP Inc. 23.73 -0.22 -0.92 9,949,729 Trade
BA The Boeing Company 344.72 -4.79 -1.37 3,445,838 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) 74.09 -0.52 -0.70 9,481,140 Trade
FE FirstEnergy Corp. 38.33 -0.35 -0.90 3,958,100 Trade
KO Coca-Cola Company (The) 49.76 -0.10 -0.20 12,106,794 Trade
T AT&T Inc. 30.51 0.18 0.59 31,293,471 Trade
PJC Piper Jaffray Companies 69.38 -1.25 -1.77 65,699 Trade
CAT Caterpillar Inc. 125.10 -0.86 -0.68 5,516,285 Trade
HAL Halliburton Company 32.25 -0.02 -0.06 15,648,681 Trade
NEM Newmont Mining Corporation 32.40 0.99 3.15 6,549,234 Trade
CREE Cree Inc. 42.92 -0.76 -1.74 1,206,229 Trade
ISRG Intuitive Surgical Inc. 498.64 -4.80 -0.95 607,540 Trade
DOV Dover Corporation 84.75 -0.57 -0.67 1,695,871 Trade
MMI Marcus & Millichap Inc. 37.00 -0.11 -0.30 445,855 Trade
MSFT Microsoft Corporation 104.97 -1.97 -1.84 39,495,141 Trade
TXT Textron Inc. 56.01 0.11 0.20 1,997,475 Trade

Comments

Emerging Growth

Investview Inc

Investview Inc is an investor technology and education company. It provides products that allow the individual investor to find, analyze, track, and manage their portfolio.