Equities Sector Coverage: Wall Street Hits New Highs Ahead of Q3 Earnings

Sector Recap |

wall streetNon-farm Payrolls were up 114,000 with the Unemployment Rate down to 7.8% from 8.1%. The Dow Jones Industrial Average traded up to 13,661.87 above the September 14 QE3 reaction high which was 13,653.24. The NASDAQ traded up to 3171.46 still below the September 21 QE3 reaction high at 3196.93.

In Asian, the Nikkei 225 ended the day at 8,863 – up 0.44%. The Hang Seng ended the day at 21,012 – up 0.50%. European exchanges were higher on Friday. The FTSE 100 ended the day at 5,871 – up 0.74%. The DAX ended the day at 7,398 – up 1.27%. The CAC 40 ended the day at 3,457 – up 1.64%. The yield on the 10-Year US Treasury rose from 1.656% to 1.741% back between its 50-day and 200-day simple moving averages at 1.673% and 1.812%.

Comex gold rose to a new 2012 high at $1798.1 the Troy ounce then declined to $1774.5. Nymex crude oil declined from $91.71 per barrel to $89.01 staying below its 50-day and 200-day simple moving averages at $93.71 and $96.15. The euro versus the dollar rallied from 1.2996 to 1.3071 staying above its 200-day simple moving average at 1.2822.

Energy

Russia could make a radical shift in policy and allow western crude producers to own oil licenses in the Arctic, Energy Minister Alexander Novak has told the FT. Yesterday, Canadian Prime Minister Stephen Harper said Cnooc's (CEO) $15.1B bid for Nexen (NXY) "raises a range of difficult policy questions," and noted that "Canada is a significant investor in other parts of the world." Vanguard Natural Resources (VNR) is initiated with a Buy at UBS. Atwood Oceanics (ATW) is upgraded to Market Perform from Underperform at Raymond James. Rowan Cos (RDC) is reduced to Perform from Outperform at Raymond James. Dow components – Chevron (CVX) up 0.22%, Exxon Mobil (XOM) up 0.22%. Energy Select Sector SPDR (XLE) was trading at $73.59 at 3:30 PM on Friday, down 0.22% on the day – up 6.45% year-to-date.

Materials

BHP (BHP) CEO Marius Kloppers has sold $5.2M worth of stock in the mining giant's London and Sydney listed shares in order to pay off an expected U.K. tax bill for 245,000 shares that vested to him under a 2007 incentive scheme. Owens-Illinois (OI) gets a Buy-from-Neutral boost at Goldman Sachs. ArcelorMittal (MT) is now Neutral from Buy at Citigroup. MeadWestvaco (MWV) is moved to Neutral from Buy at Goldman Sachs. Dow Components – Alcoa (AA) relatively unchanged, DuPont (DD) up 1.02%. The Materials Select Sector SPDR (XLB) was trading at $37.17 at 3:30 PM on Friday, up 0.41% on the day – up 10.96% year-to-date.

Industrials

GE (GE) has attracted interest from Oversea-Chinese Banking Corp and Kuala Lumpur-based CIMB for its $1.6B, 25% stake in Thailand's Bank of Ayudhya. USG Corp (USG) is resumed at Outperform at Robert W. Baird. Dow components – Boeing Co (BA) up 1.17%, Caterpillar (CAT) down 0.72%, General Electric (GE) up 0.65%, 3M Company (MMM) up 0.42%, United Technologies (UTX) down 0.22%. The Industrial Select Sector SPDR (XLI) was trading at $37.105 at 3:30 PM on Friday, up 0.18% on the day – up 9.94% year-to-date.

Consumer Discretionary

Gannett (GCI) has threatened to stop broadcasting on Dish (DISH) if the satellite TV provider doesn't drop the ad-skipping feature on its digital-video recorders or agree to pay large penalties. The Senkaku-Diaoyu islands dispute between Japan and China hit Japanese car makers hard in September, with Mitsubishi's Chinese sales plunging 63% on year and those of Mazda (MZDAF) by 35%. Toyota's (TM) sales skidded 40%, adding that the company will cut production in China by over half and suspend Lexus exports. Fiat (FIATY) intends to renew talks to acquire Opel from GM (GM) if the U.S. car manufacturer decides to sell the perennial loss maker, with Fiat hoping to get Opel for free. Dollar Tree (DLTR) and Family Dollar (FDO) are each assigned Outperforms at Credit Suisse. Buffalo Wild Wings (BWLD) is boosted to Outperform from Neutral with Wedbush. Burberry Group (BURBY) is boosted to Overweight from Equal Weight with Morgan Stanley. Gap Inc (GPS) gets upgraded to Buy from Above Average at Caris & Company. Pep Boys (PBY) gets upgraded to Buy from Hold at The Benchmark Company. Autoliv (ALV) is slashed to Sell from Neutral at UBS. Marriott International (MAR) gets downgraded at UBS (Neutral from Buy), Lazard (Neutral from Buy), and ISG Group (Hold from Buy).
Dow Components – Disney (DIS) up 0.56%, Home Depot (HD) up 1.98%, McDonalds (MCD) down 0.29%. The Consumer Discretionary Select Sector SPDR (XLY) was trading at $47.60 at 3:30 PM on Friday, up 0.27% on the day – up 21.99% year-to-date.

Consumer Staples

AM Constellation Brands (STZ) beat estimates by 17 cents, while missing revenue by $11M. Annie’s (BNNY) is a new Neutral at Janney Montgomery Scott. Craft Brew Alliance (BREW) gets begun with a Buy at Roth Capital. Hain Celestial (HAIN) is initiated with a Buy at Janney Montgomery Scott. Dow components – Coca Cola (KO) up 0.39%, Procter & Gamble (PG) up 0.26%, Wal-Mart (WMT) up 0.43%. The Consumer Staples Select Sector SPDR (XLP) was trading at $36.475 at 3:30 PM on Friday, up 0.29% on the day – up 12.27% year-to-date.



Health Care

UnitedHealth (UNH) is ahead in the race to acquire a part or a 100% holding in Brazilian insurer and hospital operator Amil Participacoes (AMPIF), which has a market cap of 9.01B reais ($4.47B). VirtualScopics (VSCP) lowers its FY12 revenue view to $12.5M - $13M from its prior $14M - $15M estimate, and below current FY12 consensus of $14.3M. Health-care data processor HMS Holdings (HMSY) cut its full-year guidance, saying it's seeing lower-than-expected growth related to its benefits-coordination business along with other delays. A host of Wall Street firms weigh in on NuVasive (NUVA), cutting their ratings after the company lowered its Q3 revenue outlook. Barclay's to Equalweight, JMP to Market Perform, First Analysis to Equal Weight, Summer Street to Neutral, BMO and RBC to Underperform, and Well Fargo to Market Perform. Thermo Fisher (TMO) is taken to Outperform from Market Perform at Wells Fargo. Biogen Idec (BIIB) is downgraded to Perform from Outperform at Oppenheimer. Endo Health (ENDP) is cut to Sector Perform from Outperform at RBC Capital.

Big Movers – Geron Corp. (GERN) is down about 13%. AEterna Zentaris (AEZS) is down about 12.5%. Dow Components – Johnson & Johnson (JNJ) up 0.46%, Merck (MRK) down 0.22%, Pfizer (PFE) up 0.47%, United Health Group (UNH) down 1.86%. The Health Care Select Sector SPDR (XLV) was trading at $41.14 at 3:30 PM on Friday, up 0.02% on the day – up 18.59% year-to-date.

Financials

New York AG Eric Schneiderman has made "tolling agreements" with 12 financial institutions that will stop the clock on the six-year statute of limitations and allow authorities to bring civil fraud claims against the firms for any wrongdoing related to mortgage bonds from as far back as 2006. U.S. authorities are investigating Credit Suisse (CS) over its mortgage bonds, with the bank also facing a lawsuit from the National Credit Union Administration for allegedly misrepresenting the underwriting and sale of such bonds to three unions that collapsed after paying over $715M for the securities. Astoria Financial (AF) is a Hold at Jefferies. CapLease (LSE) is launched with an Outperform at JMP Securities. Fidelity National (FIS) is upgraded to Outperform from Neutral at Robert W. Baird. WisdomTree Investments (WETF) gets upgraded to Conviction Buy from Buy at Goldman Sachs. Swiss Re (SSREY) is downgraded to Reduce from Neutral at Nomura. TD Ameritrade Holding (AMTD) is taken to Market Perform from Outperform at Raymond James. Big Movers – Life Partners Holdings (LPHI) is up about 12%. Dow Components – American Express (AXP) up slightly, Bank of America (BAC) down 1.43%, JP Morgan Chase (JPM) down 0.60%, Travelers (TRV) up 0.22%. The Financial Select Sector SPDR (XLF) was trading at $16.065 at 3:30 PM on Friday, unchanged on the day – up 23.58% year-to-date.

Information Technology

Samsung (SSNLF) expects Q3 earnings to beat forecasts as operating profit jumped 91% to a record 8.1T won ($7.09B) and sales rose to 51T-53T won from 41.27T won a year earlier. Zynga (ZNGA) warned yesterday that it expects 2012 bookings of $1.085B-$1.1B, below already lowered guidance of $1.15B-$1.225B. The company also expects Q3 revenue of $300M-$305M - above consensus - but forecast that bookings will amount to just $250M-$255M. Cisco (CSCO) is reshuffling its management, with worldwide sales chief Rob Lloyd becoming President and head of development and sales, and COO Gary Moore being named as a president as well, while America’s sales chief Chuck Robbins will take over Lloyd's old job. Mercury Computer Systems (MRCY) now expects revenue to be in the range of $48M - $50M - including revenues from Micronetics, which was acquired by Mercury on August 8, 2012 - below Street estimates of $58M. Datalink (DTLK) now expects Q3 revenue of $105M-$106M and EPS of $104M-$105M and EPS of $0.14-$0.15, below a consensus of $120.4M and $0.23. Molex (MOLX) is a new Hold at Jefferies. Skyworks Solutions (SWKS) is a new Buy at Lazard Capital. TriQuint Semiconductor (TQNT) is launched with a Buy at Lazard. Automatic Data Processing (ADP) is upgraded to Buy from Neutral at Goldman Sachs. Adtran (ADTN) gets downgraded to Underweight from Equal Weight by Barclays. F5 Networks (FFIV) is taken to Equal Weight from Overweight by Barclays. Hewlett-Packard (HPQ) is cut at both Argus (Hold from Buy) and Sterne Agee (Neutral from Buy). Linear Technology (LLTC) gets downgraded to Underperform from Perform at Raymond James. Mercury Computer (MRCY) is moved to Neutral from Buy at Sterne Agee. Zynga (ZNGA) is now Neutral at Robert W. Baird. An over-dependence on Facebook (FB) and ongoing headwinds in user monetization are key concerns.
Big Movers – Mercury Computer Systems (MRCY) is down about 18%. Zynga (ZNGA) is down about 16.5%. First Solar (FSLR) is down about 12%. Dow Components – Cisco Systems (CSCO) down 0.29%, Hewlett-Packard (HPQ) down 0.67%, IBM (IBM) down slightly, Intel Corp (INTC) up 1.16%, Microsoft (MSFT) down 0.83%. The Technology Select Sector SPDR (XLK) was trading at $30.885 at 3:30 PM on Friday, down 0.53% on the day – up 21.36% year-to-date.

Telecommunication Services

The Sprint (S) board has scheduled a noon phone meeting to discuss the possibility of renewing its pursuit of MetroPCS (PCS). Big Movers – Neutral Tandem (IQNT) is down about 15.5%. Dow Components – AT&T (T) down 1.41%, Verizon (VZ) down 0.32%. The NASDAQ Telecommunications Index (IXTC) was trading at $198.65 at 3:30 PM on Friday, down 0.11% on the day – up 0.87% year-to-date.

Utilities

The Big Names – Dominion Resources (D) down slightly, Edison International (EIX) up 0.56%, First Energy (FE) down slightly, PG&E Corp (PCG) down 0.35%, Southern Company (SO) down slightly. The Utilities Select Sector SPDR (XLU) was trading at $36.775 at 3:30 PM on Friday, down 0.12% on the day – up 2.15% year-to-date.

STOCKS: CVX, XOM, AA, DD, BA, CAT, GE, MMM, UTX, DIS, HD, MCD, KFT, KO, PG, WMT, JNJ, MRK, PFE, AXP, BAC, JPM, TRV, CSCO, HPQ, IBM, INTC, MSFT, T, VZ, D, EIX, FE, PCG, SO, CEO, NXY, VNR, ATW, RDC, BHP, OI, MT, MWV, GE, USG, GCI, DISH, MZDAF, TM, FIATY, GM, DLTR, FDO, BWLD, BURBY, GPS, PBY, ALV, MAR, STZ, BNNY, BREW, HAIN, UNH, AMPIF, VSCP, HMSY, NUVA, TMO, BIIB, ENDP, GERN, AEZS, CS, AF, LSE, FIS, WETF, SSREY, AMTD, LPHI, SSNLF, ZNGA, CSCO, MRCY, DTLK, MOLX, SWKS, TQNT, ADP, ADTN, FFIV, HPQ, LLTC, MRCY, FB, S, PCS, IQNT

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
CEO CNOOC Limited 111.25 0.91 0.82 71,450 Trade
MMM 3M Company 203.53 -1.82 -0.89 1,838,640 Trade
RDC Rowan Companies plc Class A 9.33 0.20 2.19 3,034,824 Trade
UNH UnitedHealth Group Incorporated (DE) 190.82 -1.88 -0.98 2,858,501 Trade
ADTN ADTRAN Inc. 21.60 0.10 0.47 1,276,038 Trade
AF Astoria Financial Corporation 19.07 -0.03 -0.16 1,563,377 Trade
TM Toyota Motor Corporation 111.73 0.28 0.25 120,102 Trade
PG Procter & Gamble Company (The) 92.47 0.40 0.43 6,815,008 Trade
GE General Electric Co 24.55 -0.20 -0.81 34,273,076 Trade
CVX Chevron Corporation 106.48 0.56 0.53 5,467,369 Trade
SO Southern Company (The) 48.30 0.38 0.79 4,853,025 Trade
ADP Automatic Data Processing Inc. 104.41 -0.27 -0.26 5,300,922 Trade
PCG Pacific Gas & Electric Co. 69.14 0.16 0.23 2,069,248 Trade
DISH DISH Network Corporation 56.84 -0.10 -0.18 2,084,893 Trade
ATW Atwood Oceanics Inc. 6.26 0.22 3.64 3,858,801 Trade
FB Facebook Inc. 167.41 0.50 0.30 15,093,638 Trade
JNJ Johnson & Johnson 132.63 -0.41 -0.31 4,792,761 Trade
WMT Wal-Mart Stores Inc. 79.31 -0.39 -0.49 9,752,957 Trade
AA Alcoa Inc. 37.76 -0.04 -0.11 2,118,671 Trade
INTC Intel Corporation 35.01 -0.16 -0.45 16,231,408 Trade
IBM International Business Machines Corp 139.70 -1.00 -0.71 4,152,714 Trade
D Dominion Resources Inc. 78.69 0.57 0.73 2,303,023 Trade
TRV The Travelers Companies Inc. 127.89 -0.30 -0.23 1,246,905 Trade
DTLK Datalink Corporation n/a n/a n/a 0 Trade
S Sprint Corporation 8.07 -0.02 -0.25 4,690,810 Trade
OUTR Outerwall Inc. n/a n/a n/a 0 Trade
EIX Edison International 78.94 -0.07 -0.09 3,203,846 Trade
JPM JP Morgan Chase 90.74 0.09 0.10 13,040,738 Trade
AXP American Express Company 85.38 -0.71 -0.82 4,271,186 Trade
AMTD TD Ameritrade Holding Corporation 42.43 -0.01 -0.02 2,400,722 Trade
UTX United Technologies Corporation 115.48 -0.62 -0.53 2,760,448 Trade
OI Owens-Illinois Inc. 23.90 -0.12 -0.50 1,062,172 Trade
BWLD Buffalo Wild Wings Inc. 108.70 -1.35 -1.23 345,712 Trade
CSCO Cisco Systems Inc. 30.37 -0.67 -2.16 34,802,193 Trade
DIS Walt Disney Company (The) 100.70 -0.68 -0.67 6,893,916 Trade
MAR Marriott International 98.03 0.19 0.19 1,581,465 Trade
VZ Verizon Communications Inc. 47.69 -0.20 -0.42 16,919,130 Trade
GERN Geron Corporation 2.03 -0.03 -1.46 818,152 Trade
GM General Motors Company 34.83 -0.17 -0.49 7,193,463 Trade
DLTR Dollar Tree Inc. 74.25 -0.09 -0.12 2,128,280 Trade
BAC Bank of America Corporation 23.62 -0.02 -0.08 60,461,197 Trade
BHP BHP Billiton Limited 40.40 -0.06 -0.15 1,831,147 Trade
LLTC Linear Technology Corporation n/a n/a n/a 0 Trade
MCD McDonald\'s Corporation 157.76 -0.13 -0.08 2,595,695 Trade
TMO Thermo Fisher Scientific Inc 172.57 -0.32 -0.19 1,182,702 Trade
DD E.I. du Pont de Nemours and Co. 81.18 0.32 0.40 1,952,437 Trade
GPS Gap Inc. (The) 22.65 -0.03 -0.13 18,942,315 Trade
USG USG Corporation 26.31 0.53 2.06 1,740,441 Trade
VSCP VirtualScopics Inc n/a n/a n/a 0 Trade
MRCY Mercury Systems Inc 45.91 0.28 0.61 234,572 Trade
HD Home Depot Inc. (The) 147.49 -2.18 -1.46 6,989,147 Trade
AEZS AEterna Zentaris Inc. 1.88 0.01 0.53 462,874 Trade
XOM Exxon Mobil Corporation 76.64 0.38 0.50 14,324,342 Trade
HMSY HMS Holdings Corp 17.43 -0.09 -0.51 433,907 Trade
PFE Pfizer Inc. 32.67 -0.28 -0.85 15,490,145 Trade
ZNGA Zynga Inc. 3.62 0.05 1.40 5,760,884 Trade
VNR Vanguard Natural Resources LLC n/a n/a n/a 0
BIIB Biogen Inc. 281.77 -2.65 -0.93 814,072 Trade
ALV Autoliv Inc. 105.48 -1.00 -0.94 302,109 Trade
MT ArcelorMittal 25.97 0.53 2.08 4,117,322 Trade
WETF WisdomTree Investments Inc. 8.91 0.03 0.34 1,204,379 Trade
HPQ HP Inc. 18.51 -0.13 -0.70 11,687,271 Trade
BREW Craft Brew Alliance Inc. 18.65 0.35 1.91 119,127 Trade
BA Boeing Company (The) 235.77 0.18 0.08 2,939,494 Trade
ENDP Endo International plc 8.72 0.09 1.04 5,294,100 Trade
SWKS Skyworks Solutions Inc. 102.21 0.00 0.00 1,139,401 Trade
MRK Merck & Company Inc. (new) 61.49 -0.35 -0.57 8,421,689 Trade
PBY Pep Boys-Manny Moe & Jack n/a n/a n/a 0 Trade
FE FirstEnergy Corporation 32.83 0.18 0.55 3,306,015 Trade
KO Coca-Cola Company (The) 45.67 -0.19 -0.41 10,879,794 Trade
T AT&T Inc. 37.37 -0.23 -0.61 23,017,865 Trade
CAT Caterpillar Inc. 113.92 0.78 0.69 3,875,693 Trade
HAIN The Hain Celestial Group Inc. 42.40 -0.32 -0.75 1,109,343 Trade
NUVA NuVasive Inc. 64.06 -1.87 -2.84 1,061,123 Trade
MSFT Microsoft Corporation 72.49 0.09 0.12 18,761,491 Trade
IQNT Inteliquent Inc. n/a n/a n/a 0 Trade
FIS Fidelity National Information Services Inc. 89.83 0.26 0.29 3,093,610 Trade
FFIV F5 Networks Inc. 116.48 -1.33 -1.13 471,347 Trade
GCI Gannett Co Inc (New) 8.18 0.04 0.49 827,845 Trade

Comments

Emerging Growth

CMX Gold & Silver Corp.

CMX Gold & Silver Corp is an exploration stage company. The Company is engaged in the acquisition, exploration and development of silver and copper/gold properties in the USA.

Private Markets

Mesa-Marshall 2 Well Project

MESA Resources ("MESA") is sponsoring the development of the two well direct drilling project -- "Mesa-Marshall #1-2". MESA, founded in 1992, is engaged in the acquisition, exploration and development of…

iPRO Network, LLC

We provide the platform, tools, and resources to empower individuals and professionals to market desirable goods and services to the public, taking the place of traditional methods of commerce.