Equities Sector Coverage: Wall Street Dips on Economic Numbers

Sector Recap  |

Initial Jobless Claims came in at 386,000, higher than expected and still above the 350,000 recessionary threshold. Existing Home Sales declined 2.6% to an annual rate of 4.48 million, below expectations. Leading Indicators rose by 0.3% in March. The Philly Fed Index came in at 8.5, well below forecasts. The Dow Jones Industrial Average fell to 12,971.18, rebounded to 13,080.20 then declined to an afternoon low at 12,896.82 back below its 50-day simple moving average at 13,009. The NASDAQ’s declined to 3025.53, rebounded to 3058.72 then declined to an afternoon low at 2994.94 below its 50-day simple moving average at 3011.

Asian stocks were mixed on Thursday. The Nikkei 225 ended their session at 9,588 – down 0.82% on the day. The Hang Seng ended their session at 20,995 – up 1.03% on the day. European stocks opened higher on Thursday, but drifted lower as the day progressed. The FTSE 100 ended their session at 5,745 – down 0.01% on the day. The DAX ended their session at 6,671 – down 0.90% on the day. The CAC 40 ended their session at 3,174 – down 2.05% on the day. The yield on the 10-Year US Treasury declined from 2.000 percent to 1.947 below its 50-day and 200-day simple moving averages at 2.083 and 2.116.

Gold declined from $1647.9 the Troy ounce to $1631.3 then rebounded to $1654.9 and then consolidated below the “death cross” defined by the 50-day simple moving average at $1688.9 being below the 200-day simple moving average at $1694.7. Crude oil declined from $103.21 per barrel to $101.67, staying below its 50-day simple moving average at $104.67. The euro versus the dollar traded down from 1.3164 to 1.3073 below its 50-day simple moving average at 1.3203.

Energy

Iraq has excluded Exxon Mobil (XOM) from its final list of 47 pre-qualified bidders for the next tender for energy exploration rights as it seeks to stop Exxon from entering Kurdistan. Diamond Offshore Drilling (DO) beat Q1 EPS estimates by 33 cents with better than expected revenue. Kinder Morgan Energy Partners (KMP) missed Q1 EPS by two cents and was below consensus on the revenue line. Noble (NE) beat Q1 EPS estimates by five cents with a beat on the revenue line. Chesapeake Energy (CHK) has been downgraded to Neutral from Buy at Sterne Agee. Dow components - Chevron (CVX) was down by 0.2% with Exxon Mobil (XOM) down 0.1%.

Energy Select Sector SPDR (XLE) was trading at $69.09 at 3:30 PM on Thursday, down 0.17% on the day – down 0.06% year-to-date.

Materials

Insteel Industries (IIIN) reported Q2 EPS of two cents with a slight miss on the revenue line. DuPont (DD) beat Q1 EPS estimates by six cents with in-line revenue. Steel Dynamics (STLD) missed Q1 EPS estimates by two cents with a miss on the revenue line. Albemarle (ALB) beat Q1 EPS estimates by four cents, but missed on the revenue line. Celanese (CE) is initiated with a Buy rating at Lazard. Dow components - Alcoa (AA) continues to have problems trending above the $10 threshold slipping 1.0%. DuPont (DD) was down 1.4% in reaction to its in-line earnings report.

The Materials Select Sector SPDR (XLB) was trading at $36.44 at 3:30 PM on Thursday, down 0.52% on the day – up 8.78% year-to-date.

Industrials

Ford (F) unveiled plans to expand in China in an effort to catch up with GM and other rivals. Ford will invest $760 million to build a new plant in the eastern Zhejiang province in addition to the $600 million to build a third factory at its Chongqing complex in southwest China. Southwest Airlines (LUV) beat Q1 EPS estimates by three cents with in-line revenue with shares up 2.5% premarket. Layne Christensen Company (LAYN) missed Q4 EPS estimates by twenty cents with in-line revenue. Danaher (DHR) beat Q1 EPS estimates by two cents with in-line revenue. Crown Holdings (CCK) beat Q1 EPS by a penny with in-line revenues. Toll Brothers (TOL) has been upgraded to Buy from Hold at Deutsche Bank. Navistar (NAV) have been downgraded to Market Perform from Outperform with Wells Fargo. Dow components - Boeing Co (BA) lost 0.4%, Caterpillar (CAT) lost 0.9%, General Electric (GE) was flat, 3M Company (MMM) was lower by 0.2%, and United Technologies (UTX) slipped 0.5%.

The Industrial Select Sector SPDR (XLI) was trading at $36.41 at 3:30 PM on Thursday, down 1.25% on the day – up 7.88% year-to-date.

Consumer Discretionary

eBay (EBAY) handily beat Q1 earnings expectations and raised its full year guidance. PayPal participated with a stellar performance, where revenue jumped 32% and which is now a payment option for 2,000 bricks-and-mortar stores. eBay (EBAY) beat Q1 EPS estimates by four cents with a better than expected revenue line. eBay shares surged 10% before the bell on these impressive earnings and on multiple upgrades; to Overweight from Neutral at Piper Jaffray, to Outperform from Neutral at Macquarie, and to Buy from Hold with a $45 price target by The Benchmark Company. Penn National Gaming (PEEN) beat Q1 EPS estimates by fifteen cents with better than expected revenue. Pool Corporation (POOL) beat Q1 EPS estimates and beat on the revenue line. Monarch Casino & Resort (MCRI) missed Q1 EPS estimates by two cents. Marriott International (MAR) beat Q1 EPS estimates by a penny but missed on the revenue line. Zynga (ZNGA) has been upgraded to Hold from Underperform at Needham. Dow Components - Disney (DIS) lost 1.0%, and McDonalds (MCD) declined 2.2%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $44.52 at 3:30 PM on Thursday, down 0.91% on the day – up 14.10% year-to-date.

Consumer Staples

Philip Morris (PM) beat Q1 EPS estimates by a nickel with revenue up 9% year over year. Stanley Works (SWK) missed Q1 EPS estimates by four cents with in-line revenue. Yum Brands (YUM) beat Q1 EPS estimates by three cents with in-line revenue. YUM Brands, the KFC, Pizza Hut, and Taco Bell owner has been downgraded to Outperform from Buy at Crédit Agricole. Safeway (SWY) has been upgraded to Hold from Sell at Deutsche Bank with a $22 price target. Dow components - Home Depot (HD) lost 0.4%, Kraft (KFT) was flat, Coca Cola (KO) lost 0.6%, Procter & Gamble (PG) was flat, and Wal-Mart (WMT) slipped by 0.3%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $33.96 at 3:30 PM on Thursday, down 0.47% on the day – up 4.52% year-to-date.

Health Care

Human Genome Sciences (HGSI) turned down an unsolicited offer of $13 a share from GlaxoSmithKline (GCK) due to valuation of the company. Human Genome is exploring "strategic alternatives," and invited GSK to take part in the process. Human Genome's shares surged 99% to $14.30 premarket. The EU has approved Johnson & Johnson's (JNJ) $21.3 billion purchase of Swiss medical device maker Synthes as J&J will divest its trauma operations in the region. Boston Scientific (BSX) beat Q1 EPS estimates by two cents with in-line revenue. Baxter International (BAX) beat Q1 EPS estimates by three cents with in-line revenue. Laboratory Corp. beat Q1 EPS estimates by nineteen cents with in-line revenue. UnitedHealth beat Q1 EPS estimates by fourteen cents with a beat on the revenue line. Perrigo (PRGO) has been downgraded to Above Average from Buy at Caris citing that an upward revision of EPS estimates is unlikely due to the weak flu season vs. last year. Dow Components - Johnson & Johnson (JNJ) gained just 0.05%, Merck (MRK) slipped by just 0.2%, and Pfizer (PFE) lost 0.6%.

The Health Care Select Sector SPDR (XLV) was trading at $37.07 at 3:30 PM on Thursday, up 0.16% on the day – up 6.86% year-to-date.

Financials

Bank of America's (BAC) missed Q1 EPS estimates by eight cents, while revenue fell 10% to $22.5 billion, which was also short of consensus. First Tennessee National (FHN) missed Q1 EPS estimates by a penny. Morgan Stanley (MS) beat Q1 EPS estimates, but missed on the revenue line and shares were up 1.9% premarket. Travelers (TRV) beat Q1 EPS estimates by 49 cents with a strong beat on the revenue line. Fifth Third Bancorp (FITB) beat Q1 EPS estimates by nine cents. KeyCorp (KEY) beat Q1 EPS estimates by two cents. BB&T beat Q1 EPS by three cents with a beat on the revenue line. American Express (AXP) beat Q1 EPS estimates by seven cents with in-line revenue. Dow Components - American Express (AXP) lost 1.0%, Bank of America (BAC) lost 0.9%, JP Morgan (JPM) fell 0.2%, and Travelers (TRV) surged by 4.6%.

The Financial Select Sector SPDR (XLF) was trading at $15.25 at 3:30 PM on Thursday, down 0.59% on the day – up 17.31% year-to-date.

Information Technology

Microsoft (MSFT) is expected to say that Q3 EPS fell to 58 cents from 61 cents a year ago when it releases its results after the close today; revenues are expected to rise 4.6% to $17.18 billion. According to a company lawyer, Apple (AAPL) wants to take its e-book pricing dispute with the Department of Justice to trial. The EU is expected to OK the $2.2 billion acquisition of EMI's music publishing division by a Sony (SNE) led group that also includes Blackstone (BX). Fairchild Semiconductor Intl.(FCS) beat Q1 EPS by two cents with a slight revenue miss and shares were up 4.2% premarket. EMC (EMC) beat Q1 EPS estimates by a penny with in-line revenue. Polycom (PLCM) reported in-line Q1 EPS, but missed on the revenue line. Novellus Systems (NVLS) reported in-line Q1 EPS with a modest beat on the revenue line. Lam Research (LRCX) beat Q3 EPS estimates by five cents with a modest beat on the revenue line. F5 Networks (FFIV) beat Q2 EPS estimated by two cents with a modest beat on the revenue line. F5 Networks has been upgraded to Buy from Hold with Wunderlich with a price target at $145.

VMware (VMW) beat Q1 EPS estimates by seven cents with in-line revenue. Dow Components - Cisco Systems (CSCO) lost 0.6%, Hewlett-Packard (HPQ) lost 0.8%, IBM (IBM) declined 0.6%, Intel Corp (INTC) fell by 0.9%, and Microsoft (MSFT) was flat before its earnings report out after the close today.
The Technology Select Sector SPDR (XLK) was trading at $29.37 at 3:30 PM on Thursday, down 1.08% on the day – up 15.40% year-to-date.

Telecommunication Services

Nokia (NOK) missed Q1 EPS while revenue slumped 29% year over year. Nokia shipped 23.8% fewer devices during the period than a year ago. Verizon (VZ) beat Q1 EPS estimates by a penny with in-line revenue. Qualcomm (QCOM) beat Q2 EPS estimates by a nickel and beat on the revenue line but shares declined 5.5%. Qualcomm (QCOM) was removed from the Top Picks Live list at Citigroup. Dow components - AT&T (T) was flat while Verizon (VZ) gained 1.7%.
The NASDAQ Telecommunications Index (IXTC) was trading at $210.88 at 3:30 PM on Thursday, up 0.05% on the day – up 7.08% year-to-date.

Utilities

It was very quiet in the Utilities space on Thursday. Dominion Resources (D) was flat, Edison International (EIX) fell 0.4%, First Energy (FE) slipped by 0.9%, and PG&E Corp (PCG) slipped by 0.2%.

The Utilities Select Sector SPDR (XLU) was trading at $34.62 at 3:30 PM on Thursday, down 0.46% on the day – down 3.78% year-to-date.

STOCKS: CVX, XOM, DO, KMP, NE, CHK, AA, DD, IIIN, STLD, ALB, CE, BA, CAT, GE, MMM, UTX, F, LUC, LAYN, DHR, CCK, NAV, DIS, MCD, EBAY, PEEN, POOL, MCRI, MAR, ZNGA, HD, KFT, KO, PG, WMT, PM, SWK, YUM, SWY, JNJ, MRK, PFE, HGSI, GSK, BSX, BAX, PRGO, AXP, BAC, JPM, TRV, MS, KEY, CSCO, HPQ, IBM, INTC, MSFT, AAPL, SNE, FCS, EMC, PLCM, FFIV, LRCX, NVLS, NOK, QCOM, 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
MMM 3M Company 163.53 3.02 1.88 1,463,218 Trade
GSK GlaxoSmithKline PLC 42.20 0.03 0.06 1,693,284 Trade
PGN Paragon Offshore n/a n/a n/a 0
PG Procter & Gamble Company (The) 117.15 -2.90 -2.42 4,169,390 Trade
GE General Electric Company 8.87 0.15 1.66 16,435,638 Trade
CVX Chevron Corporation 117.42 1.24 1.07 1,297,067 Trade
PCG Pacific Gas & Electric Co. 7.68 0.01 0.13 3,443,462 Trade
BAX Baxter International Inc. 87.96 0.76 0.87 492,020 Trade
JNJ Johnson & Johnson 133.37 2.65 2.03 4,986,664 Trade
AA Alcoa Corporation 19.65 0.48 2.48 4,824,806 Trade
INTC Intel Corporation 52.91 1.27 2.46 6,795,313 Trade
D Dominion Energy Inc. 81.31 0.07 0.09 764,437 Trade
TRV The Travelers Companies Inc. 143.75 0.64 0.44 350,443 Trade
CCK Crown Holdings Inc. 64.18 0.16 0.25 360,205 Trade
KEY KeyCorp 17.88 0.29 1.65 1,774,507 Trade
TIF Tiffany & Co. 91.59 1.33 1.47 380,471 Trade
EBAY eBay Inc. 38.86 0.50 1.30 1,753,322 Trade
EIX Edison International 70.38 0.32 0.46 1,199,738 Trade
MS Morgan Stanley 42.82 0.57 1.35 4,370,643 Trade
AXP American Express Company 117.80 1.41 1.21 866,279 Trade
ALB Albemarle Corporation 68.37 0.81 1.20 326,041 Trade
LRCX Lam Research Corporation 243.18 6.90 2.92 718,307 Trade
NVLS ALPN Cameco Corporation n/a n/a n/a n/a
UTX United Technologies Corporation 136.59 0.67 0.49 1,099,980 Trade
SWK Stanley Black & Decker Inc. 149.99 2.66 1.81 194,711 Trade
CSCO Cisco Systems Inc. 46.37 0.32 0.69 8,291,692 Trade
BSX Boston Scientific Corporation 38.48 0.51 1.33 4,218,252 Trade
MAR Marriott International 121.10 1.00 0.83 365,653 Trade
BAC Bank of America Corporation 29.85 0.71 2.42 28,053,502 Trade
YUM Yum! Brands Inc. 110.89 -1.93 -1.71 640,358 Trade
NAV Navistar International Corporation 28.92 0.31 1.08 96,858 Trade
NOK Nokia Corporation Sponsored American Depositary Shares 5.02 0.07 1.31 10,398,536 Trade
MCD McDonald's Corporation 207.37 -1.01 -0.48 1,328,500 Trade
NE Noble Corporation (UK) 1.40 0.05 3.33 1,401,511 Trade
MCRI Monarch Casino & Resort Inc. 43.19 0.81 1.91 7,919 Trade
DO Diamond Offshore Drilling Inc. 5.79 0.17 3.02 1,126,507 Trade
DHR Danaher Corporation 139.19 0.39 0.28 473,370 Trade
PM Philip Morris International Inc 78.04 0.01 0.01 1,878,453 Trade
F Ford Motor Company 9.08 0.26 2.89 14,260,076 Trade
PFE Pfizer Inc. 36.66 0.36 0.98 5,355,909 Trade
IIIN Insteel Industries Inc. 20.21 0.36 1.81 10,963 Trade
ZNGA Zynga Inc. 6.14 0.05 0.74 3,897,505 Trade
PRGO Perrigo Company plc 54.11 1.06 2.00 263,276 Trade
HPQ HP Inc. 16.80 0.26 1.54 4,554,840 Trade
MRK Merck & Company Inc. (new) 84.89 0.20 0.24 1,873,938 Trade
POOL Pool Corporation 203.44 1.20 0.59 34,427 Trade
PLCM Polycom Inc. n/a n/a n/a 0 Trade
FE FirstEnergy Corp. 47.59 0.18 0.37 951,329 Trade
KO Coca-Cola Company (The) 53.36 0.06 0.11 2,810,225 Trade
SNE Sony Corporation 58.49 0.65 1.12 541,050 Trade
CAT Caterpillar Inc. 130.77 2.39 1.86 1,476,241 Trade
QCOM QUALCOMM Incorporated 77.54 1.24 1.63 2,281,363 Trade
EMC EMC Corporation n/a n/a n/a 0 Trade
FCS Fairchild Semiconductor International Inc. n/a n/a n/a 0 Trade
MSFT Microsoft Corporation 141.45 1.90 1.36 8,852,931 Trade
CHK Chesapeake Energy Corporation 1.37 0.03 2.24 17,782,202 Trade
FFIV F5 Networks Inc. 135.84 0.44 0.32 191,598 Trade
STLD Steel Dynamics Inc. 30.08 0.44 1.48 1,116,828 Trade
WMT Walmart Inc. 119.21 0.04 0.03 1,457,160 Trade
IBM International Business Machines Corporation 143.00 0.96 0.68 1,249,199 Trade
AAPL Apple Inc. 235.98 0.11 0.05 11,037,028 Trade
JPM JP Morgan Chase & Co. 121.08 4.63 3.98 12,634,665 Trade
DIS The Walt Disney Company 130.39 0.69 0.53 2,197,606 Trade
HD Home Depot Inc. (The) 236.08 1.90 0.81 933,803 Trade
XOM Exxon Mobil Corporation 69.92 0.74 1.07 2,556,045 Trade
BA The Boeing Company 372.43 -0.75 -0.20 1,400,702 Trade

Comments

Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     

INTERVIEW: CEO Steve Stanulis - Stanulis Films

Equities.com's Sam Mitchell interviewing CEO Steve Stanulis of Stanulis Films.