Equities Sector Coverage: Wall Street Closes Out Worst Quarter in Years

Sector Recap |

Frustrated Stock TraderPersonal spending rose 0.2% in August in line with estimates, while personal income unexpectedly fell 0.1% for the first decline since October 2009. The Chicago PMI Index topped estimates with a reading of 60.4 in September up from 56.6 in August. The final reading of the Michigan consumer sentiment survey for the month of September came in at 59.4, higher than the preliminary reading of 57.8. On Monday we get the national ISM manufacturing index and construction spending. On Tuesday we get Factory Orders and listen to Fed Chief Ben Bernanke testify before the Joint Economic Committee. On Wednesday it’s the non-manufacturing ISM. Initial Jobless Claims is on Thursday and the Employment Data is on Friday. The Dow Jones Industrial Average traded down to 10,995.27 then up to 11,136.84 in morning trading then slumped below 10,950 into the final half hour of trading. The NASDAQ stayed well below its 50-day simple moving average at 2549 trading down from 2451.33 to 2435.65 then up to 2468.98 in morning trading then plunged below 2430 into the final half hour of trading.

Asian stocks traded lower on Friday with the Nikkei 225 down just 0.01% to 8,700 with the Hang Seng slipping 2.32% to 17,592. European stocks traded lower on Friday. The FTSE 100 declined by 1.32% to 5,128 with the DAX plunging 2.44% to 5,502 and the CAC 40 slumping 1.51% to 2,982. The yield on the 10-Year US Treasury declined from 2.002 percent to 1.891, still above last Friday’s all time low of 1.671 percent. Gold, which traded as low as $1535.0 the Troy ounce on Monday and as high as $1679.2 on Tuesday, traded down from $1642.5 to $1607.8 on Friday. Crude oil traded down from $83.23 per barrel to $78.75 on Friday staying well below its 200-week simple moving average at $83.66 Thursday afternoon. The euro versus the dollar traded down from 1.3599 to 1.3408 on Friday.

Energy

Marathon Oil (MRO) is moved to Hold from Sell at The Benchmark Company with a $23 target. Seadrill Ltd (SDRL) is lowered to Sector Perform from Outperform at RBC Capital. In afternoon trading: Shares of Uranium Resources (URRE) are down about 11.7%. Shares of Magnum Hunter Resources (MHR) are down about 10.8%. Shares of James River Coal (JRCC) are down about 9.1%. Shares of ATP Oil & Gas (ATPG) are downa bout 8.8%. Shares of McDermott International (MDR) are down about 8.8%.

Energy Select Sector SPDR (XLE) was trading at $58.51 at 4:00 PM on Friday, down 2.94% on the day – down 14.27% year-to-date.

Materials

Dow Chemical (DOW) is initiated with a Hold at Jefferies. Sherwin-Williams (SHW) is a Hold at KeyBanc Capital. Valspar (VAL) is a new Hold at KeyBanc Capital. Koppers Holdings (KOP) is covered with a Buy at Janney Montgomery Scott. Norsk Hydro (NHYDY) is upgraded to Hold from Sell at Citigroup. In afternoon trading: Shares of Aluminum Of China (ACH) are down about 9.5%. Shares of CF Industries (CF) are down about 8.6%. Shares of Rare Element Res (REE) are down about 8.2%.

The Materials Select Sector SPDR (XLB) was trading at $29.36 at 4:00 PM on Friday, down 3.69% on the day – down 23.57% year-to-date.

Industrials

Air Lease (AL) is launched as a Buy at Citigroup. China Eastern Airlines (CEA) is upgraded to Neutral from Underweight at HSBC Securities, which raises China Southern Airlines (ZNH) to Overweight from Neutral. Ryanair (RYAAY) is raised to Outperform from Market Perform at Raymond James. In afternoon trading: Shares of Broadwind Energy (BWEN) are up about 20.6%. Shares of Ingersoll-Rand (IR) are down about 12.4%. Shares of American Superconductor (AMSC) are down about 11.2%. Shares of Lennox International (LII) are down about 9.5%.

The Industrial Select Sector SPDR (XLI) was trading at $29.22 at 4:00 PM on Friday, down 3.34% on the day – down 16.20% year-to-date.

Consumer Discretionary

Standard & Poor's owner McGraw-Hill (MHP) and CME Group (CME), owner of Dow Jones Indexes, are in advanced talks to combine their index businesses for the first time, in a joint venture of which MHP would own 75%. Depending on estimates, Ford Motor (F) plans to add between 7,000 and 10,000 jobs in the U.S., part of talks with the United Auto Workers. Dunkin' Brands (DNKN) is assigned a Hold at Argus. In afternoon trading: Shares of Eastman Kodak (EK) are down about 58%. Shares of Home Inns & Hotels (HMIN) are down about 15%. Shares of Focus Media (FMCN) are down about 10.5%. Shares of Sotheby’s (BID) are down about 10%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $34.86 at 4:00 PM on Friday, down 2.87% on the day – down 6.82% year-to-date.

Consumer Staples

Cosan (CZZ) is cut to Equal Weight from Overweight at Morgan Stanley. In afternoon trading: Shares of AgFeed Industries (FEED) are down about 15.1%. Shares of Coffee Holding (JVA) are down about 10%. Shares of Chef’s Warehouse (CHEF) are down about 7.6%. Shares of Origin Agritech (SEED) are down about 7.5%. Shares of NuPathe (PATH) are down about 6.4%. Shares of Pilgrim’s Pride (PPC) are up about 7.6%. Shares of Farmer Brothers (FARM) are up about 7.1%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $29.66 at 4:00 PM on Friday, down 1.03% on the day – up 1.19% year-to-date.

Healthcare

Spectrum Pharmaceuticals (SPPI) and DepoMed (DEPO) are both begun with Buy recommendations and respective price objectives of $11.50 and $10 at Auriga, which also has a Buy rating and $55 target on Jazz Pharmaceuticals (JAZZ) and starts Salix Pharmaceuticals (SLXP) at a Hold and $30 target price. Simcere Pharmaceuticals (SCR) is downgraded to Perform from Outperform at Oppenheimer. In afternoon trading: Shares of Tengion (TNGN) are down about 17%. Shares of Sun Healthcare (SUNH) are down about 12.7%. Shares of Biodel (BIOD) are down about 10.2%.

The Health Care Select Sector SPDR (XLV) was trading at $31.73 at 4:00 PM on Friday, down 1.28% on the day – up 0.73% year-to-date.

Financials

The cost of acquiring credit-default swaps to insure Morgan Stanley's (MS) debt has soared to 456bp, higher than the cost of buying swaps for some major French and Italian banks. In a move likely to be followed by other banks, Bank of America (BAC) will soon charge most of its customers a new $5 fee for any month in which they use a BofA debit card to make a purchase. Glimcher Realty (GRT) is now a Buy from Neutral at Bank of America-Merrill Lynch. C-Cube Micro (CUBE) is cut by 180 degrees, to Underperform from Outperform at FBR Capital with a new price objective of $8. Societe Generale SA (SCGLY) is downgraded to Neutral from Buy at UBS. In afternoon trading: Shares of Ambaq Financial (AMBFQ) are up about 21.9%. Shares of Morgan Stanley (MS) are down about 8.5%. Shares of ING Group (ING) are down about 8.5%. Shares of Deutsche Bank (DB) are down about 8.2%. Shares of UBS (UBS) are down about 8%.

The Financial Select Sector SPDR (XLF) was trading at $11.81 at 4:00 PM on Friday, down 3.51% on the day – down 25.96% year-to-date.

Information Technology

Hewlett-Packard (HPQ) agreed to pay ousted CEO Leo Apotheker $7.2 million in severance over the next 18 months, and millions more in bonuses and stock - the culmination of a stormy 11-month tenure during which the company lost $38 billion in market value. Micron Technology (MU) fell more than 3% after hours Thursday after posting a surprise loss of $135 million (or $0.14 a share), a swing from the prior year's profit of $0.32 a share. IBM's market cap has surpassed Microsoft's (MSFT) for the first time since 1996. While Big Blue's profits have steadily increased as the company abandoned low-margin hardware businesses, and focused its attention on higher-margin services and software operations. Piper Jaffray has Overweights on ASML (ASML), Micron Technology (MU) - $8 target, Applied Materials (AMAT) - $15 target, Lam Research (LRCX) - $46 target, and SanDisk (SNDK) - $58 target. The brokerage has a new Neutral and $7 target price on MEMC Electronic Materials (WFR). Ceva (CEVA) is boosted to Buy from Hold with a $31 target at Benchmark. Altera (ALTR) is downgraded to Hold from Buy at Auriga with a new target of $37. Itron (ITRI) is moved to Underperform from Neutral at Bank of America-Merrill Lynch. In afternoon trading: Shares of Micron Technology are down about 13.5%. Shares of Renren (RENN) are down about 10.8%.

The Technology Select Sector SPDR (XLK) was trading at $23.60 at 4:00 PM on Friday, down 2.52% on the day – down 6.31% year-to-date.

Telecommunications Services

In afternoon trading: Shares of TerreStar (TSTRQ) are down about 23%. Shares of Clearwire (CLWR) are down about 7.8%. Shares of NII Holdings (NIHD) are down about 7.7%. Shares of Towerstream (TWER) are down about 5.9%. Shares of Mobile Telesystems (MBT) are down about 5.9%. Shares of MetroPCS (PCS) are down about 4.4%. Shares of Telecom Italia (TI) are down about 4.4%. Shares of VimpelCom (VIP) are down about 4.1%.

The NASDAQ Telecommunications Index (IXTC) was trading at $178.06 at 4:00 PM on Friday, down 2.70% on the day – down 20.99% year-to-date.

Utilities

Edison International (EIX) is lifted to Buy from Hold at Wunderlich with a new target of $43. In afternoon trading: Shares of Dynegy (DYN) are down about 5.6%. Shares of Veolia Environment (VE) are down about 5.5%. Shares of Genon Energy (GEN) are down about 5.5%. Shares of AES Corp (AES) are down about 4.1%. Shares of E ON AG (EONGY) are down about 4.1%. Shares of GDF Suez (GDFZY) are down about 3.6%.

The Utilities Select Sector SPDR (XLU) was trading at $33.62 at 4:00 PM on Friday, down 1.12% on the day – up 7.28% year-to-date.

STOCKS: MRO, SDRL, URRE, MHR, JRCC, ATPG, MDR, DOW, SHW, VAL, KOP, NHYDY, ACH, CF, REE, AL, CEA, ZNH, RYAAY, BWEN, IR, AMSC, LII, MHP, CME, F, DNKN, EK, HMIN, FMCN, BID, CZZ, FEED, JVA, CHEF, SEED, PATH, PPC, FARM, SPPI, DEPO, JAZZ, SLXP, SCR, TNGN, SUNH, BIOD, MS, BAC, GRT, CUBE, SCGLY, AMBFQ, MS, ING, DB, UBS, HPQ, MU, MSFT, ASML, AMAT, LRCX, SNDK, WFR, CEVA, ALTR, ITRI, RENN, TSTRQ, CLWR, NIHD, TWER, MBT, PCS, TI, VIP, EIX, DYN, VE, GEN, AES, EONGY, GDFZY

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
ACH Aluminum Corporation of China Limited American Dep 9.19 -0.11 -1.18 16,368
AES The AES Corporation 13.26 0.07 0.53 3,955,833
AL Air Lease Corporation Class A 27.84 -0.06 -0.22 753,058
ALTR Altera Corp. n/a n/a n/a 0
AMAT Applied Materials Inc. 29.66 -0.63 -2.08 13,971,788
AMSC American Superconductor Corporation 6.83 -0.11 -1.59 27,549
ASML ASML Holding N.V. 108.57 -0.22 -0.20 664,713
BAC Bank of America Corporation 15.52 -0.08 -0.51 51,604,424
BID Sotheby\'s 38.35 0.03 0.08 841,758
BIOD Biodel Inc. 0.45 0.03 7.14 392,056
BWEN Broadwind Energy Inc. 4.35 -0.06 -1.36 16,543
CEA China Eastern Airlines Corporation Ltd. 23.93 0.04 0.17 17,876
CEVA CEVA Inc. 35.79 -0.50 -1.38 106,895
CF CF Industries Holdings Inc. 22.63 -0.60 -2.58 6,960,761
CHEF The Chefs\' Warehouse Inc. 11.75 -0.22 -1.84 83,153
CME CME Group Inc. 106.49 -1.93 -1.78 1,787,501
CUBE CubeSmart 27.77 -0.10 -0.36 1,210,910
CZZ Cosan Limited Class A 6.89 -0.04 -0.58 4,753,394
DB Deutsche Bank AG 12.75 -0.25 -1.92 6,149,046
DEPO Depomed Inc. 24.51 -0.79 -3.12 1,278,506
DNKN Dunkin\' Brands Group Inc. 50.11 0.71 1.44 1,029,661
EIX Edison International 75.62 0.11 0.15 1,399,240
F Ford Motor Company 12.17 -0.01 -0.08 18,993,510
FARM Farmer Brothers Company 36.45 0.25 0.69 174,657
GEN Genesis Healthcare Inc. 2.72 -0.07 -2.51 154,075
HMIN Homeinns Hotel Group ADR (Sponsored) n/a n/a n/a 0
HPQ HP Inc. 15.09 -0.03 -0.20 8,102,240
ING ING Group N.V. 12.33 -0.13 -1.04 3,496,692
IR Ingersoll-Rand plc (Ireland) 64.65 -1.40 -2.12 2,248,494
ITRI Itron Inc. 55.17 -0.69 -1.24 255,923
JAZZ Jazz Pharmaceuticals plc 127.19 0.54 0.43 550,089
JVA Coffee Holding Co. Inc. 5.58 0.06 1.09 31,364
KOP Koppers Holdings Inc. 31.14 -0.45 -1.42 42,564
LII Lennox International Inc. 157.19 -1.62 -1.02 483,128
LRCX Lam Research Corporation 91.78 -0.91 -0.98 1,725,036
MBT Mobile TeleSystems PJSC 7.75 -0.39 -4.79 5,748,773
MDR McDermott International Inc. 4.59 -0.22 -4.57 2,457,693
MHR Magnum Hunter Resources Corp n/a n/a n/a 0
MRO Marathon Oil Corporation 14.49 -0.38 -2.56 22,031,468
MS Morgan Stanley 31.91 -0.33 -1.02 9,400,557
MSFT Microsoft Corporation 57.43 -0.39 -0.67 19,955,336
MU Micron Technology Inc. 17.48 -0.11 -0.63 17,947,621
NIHD NII Holdings Inc. 3.32 0.01 0.30 517,104
PPC Pilgrim\'s Pride Corporation 20.96 -0.24 -1.13 774,612
REE Rare Element Resources n/a n/a n/a n/a
RENN Renren Inc. American Depositary Shares each repres 1.95 0.05 2.63 505,221
RYAAY Ryanair Holdings plc American Depositary Shares ea 75.06 -0.23 -0.31 226,376
SDRL Seadrill Limited (Bermuda) 2.03 -0.07 -3.33 5,279,315
SEED Origin Agritech Limited 2.30 0.12 5.50 238,766
SHW Sherwin-Williams Company (The) 283.00 3.38 1.21 762,793
SNDK SanDisk Corp. n/a n/a n/a 0
SPPI Spectrum Pharmaceuticals Inc. 4.72 -0.09 -1.87 676,146
TI Telecom Italia S.P.A. New 8.48 -0.02 -0.24 33,255
TWER Towerstream Corporation 1.28 -0.10 -7.25 517,663
UBS UBS Group AG Registered 13.81 -0.16 -1.15 1,147,236
URRE Uranium Resources Inc. 1.43 -0.06 -4.03 324,178
VAL Valspar Corporation (The) 106.59 -0.43 -0.40 188,835
VIP VimpelCom Ltd. 3.54 -0.03 -0.84 4,962,238
ZNH China Southern Airlines Company Limited 28.75 -0.10 -0.35 8,367

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