The Dow Jones Industrial Average traded down to 12,337.25 then up to 12,430.00. The NASDAQ traded down to 2627.23 then up to 2653.18 staying below its 200-day simple moving average at 2660.
Asian stocks were mixed on Wednesday with the Nikkei 225 ending its first session of the year at 8,560 – up 1.24%. The Hang Seng ended their session at 18,727 – down 0.8% on the day. European stocks moved lower on Wednesday. The FTSE 100 ended their session at 5,668 – down 0.55% on the day; the DAX ended their session at 6,112 – down 0.89% on the day; and the CAC 40 ended their session at 3,194 – down 1.59% on the day. The yield on the 10-Year US Treasury note rose from 1.933 percent to 2.012 testing its 50-day simple moving average at 2.004.
Gold rallied from $1593.8 the Troy ounce to $1619.8 staying below its 200-day simple moving average at $1625.0. Crude oil stayed above its 50-day and 200-day simple moving averages at $97.42 and $95.76 in a day’s range between $101.88 a barrel and $103.74. The euro versus the dollar traded down from 1.3072 to 1.2901.
Energy
India’s Reliance and P-E firm Apollo Global (APO) are among the companies in discussion to buy El Paso’s (EP) oil and gas exploration and production unit, Bloomberg reports. Kinder Morgan (KMI) is looking to sell the business, whose value is estimated at around $8.1B, to help finance its $21B acquisition of El Paso. A provincial appeals court in Ecuador has rejected Chevron’s (CVX) efforts to overturn an $18B judgment for the spilling of chemicals into the Amazon River basin. BP (BP) has halted payments from its $20B Gulf oil spill compensation fund until a federal court clarifies an order issued in December. Oiltanking Partners (OILT) is a new Buy at Bank of America-Merrill Lynch.
Energy Select Sector SPDR (XLE) was trading at $71.20 at 4:00 PM on Wednesday, up 0.21% on the day – up 2.99% year-to-date. The 2011 change was +1.29%.
Materials
CF Industries (CF) is lifted to Buy from Neutral at Citigroup. AK Steel (AKS) is now Neutral from Underperform at Bank of America-Merrill Lynch, which lifts Steel Dynamics (STLD) to Buy from Neutral. Compass Minerals (CMP) is cut to Neutral from Buy at Ticonderoga. Citigroup cut Mosaic (MOS) to Neutral from Buy, while they cut Potash Corp (POT) from their Top Picks Live List. In afternoon trading: Shares of Rare Element (REE) are up about 27% on over 3x average daily volume on news that there was a 38% increase of M & I rare-Earth mineral resources at Bear Lodge.
The Materials Select Sector SPDR (XLB) was trading at $34.72 at 4:00 PM on Wednesday, up 0.84% on the day – up 3.64% year-to-date. The 2011 change was -12.78%.
Industrials
General Dynamics (GD) gets an Overweight-from-Neutral upgrade at JPMorgan. Lockheed (LMT) is lowered to Neutral from Overweight at JPMorgan. Vestas Wind Systems (VWDRY) is downgraded to Underweight from Equal Weight at HSBC Securities. Union Pacific (UNP) is reduced to Hold from Buy with an objective of $113 at Stifel Nicolaus. In afternoon trading: Shares of TBS International (TBSI) are up about 57%.
The Industrial Select Sector SPDR (XLI) was trading at $34.65 at 4:00 PM on Wednesday, up 0.46% on the day – up 2.67% year-to-date. The 2011 change was -3.21%.
Consumer Discretionary
Some tech giants are so opposed to the Stop Online Piracy Act [SOPA] that there’s been talk of a “nuclear option” whereby Google (GOOG), Amazon (AMZN), Yahoo (YHOO), eBay (EBAY) and others would simultaneously go dark to protest the legislation. The NYSE has told Eastman Kodak (EK) that it has six months to get back into compliance (be trading at or above $1) or risk de-listing because its stock has traded below $1 for the last 30 trading days. Liz Claiborne (LIZ) is changing its name to become Fifth & Pacific Companies to better communicate its strategic focus on growing its three global lifestyle brands and to reflect the sale of its Liz Claiborne namesake brand to J.C. Penney. Interpublic Group (IPG) gets picked up with a Neutral at Piper Jaffray. American Eagle (AEO) gets a Buy-from-Neutral boost Janney Montgomery Scott with a price target of $20. AutoZone (AZO) is added to the Top Picks Live list at Citigroup. Chipotle Mexican Grill (CMG) is added to the Conviction Buy List at Goldman Sachs. Dunkin’ Brands (DNKN) is now Neutral from Sell at Goldman. Lululemon Athletica (LULU) is added to Goldman’s list of Conviction Buys. Guggenheim starts new Neutrals on Ford (F) and General Motors (GM). Warnaco Group (WRC) is upgraded to Equal Weight from Underweight at Morgan Stanley. Virgin Media (VMED) is reduced to Hold from Buy at The Royal Bank of Scotland. Education Management (EDMC) is moved to Equal Weight from Overweight at Barclays. In afternoon trading: Shares of Eastman Kodak are down about 29%. Shares of Netflix (NFLX) are up about 11%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $39.66 at 4:00 PM on Wednesday, up 0.79% on the day – up 1.64% year-to-date. The 2011 change was +4.30%.
Consumer Staples
Church & Dwight (CHD) is moved to Market Perform from Outperform by BMO Capital. Energizer (ENR) is trimmed to Market Perform from Outperform by BMO Capital. In afternoon trading: Heavily Active Stocks: Shares of Altria Group (MO) are down about 0.4%. Shares of Wal-Mart (WMT) are down about 1%. Shares of Walgreens (WAG) are down about a half of a percent. Shares of Procter & Gamble (PG) are down about a half of a percent. Shares of CVS Caremark (CVS) are up about 0.2%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $32.39 at 4:00 PM on Wednesday, down 0.22% on the day – down 0.31% year-to-date. The 2011 change was +10.85%.
Healthcare
In afternoon trading: Shares of Complete Genetics (GNOM) are up about 22.75%. Shares of Jazz Pharmaceuticals (JAZZ) are up about 7.25%. Shares of Amarin Corp. (AMRN) are down about 9%. Shares of Vanguard Health Services (VHS) are down about 7.25%. Heavily Active Stocks: Shares of Pfizer (PFE) are down about 0.9%. Shares of Boston Scientific (BSX) are down about 1%.
The Health Care Select Sector SPDR (XLV) was trading at $34.97 at 4:00 PM on Wednesday, down 0.48% on the day – up 0.81% year-to-date. The 2011 change was +10.32%.
Financials
India’s Reliance and P-E firm Apollo Global (APO) are among the companies in discussion to buy El Paso’s (EP) oil and gas exploration and production unit, Bloomberg reports. Kinder Morgan (KMI) is looking to sell the business, whose value is estimated at around $8.1B, to help finance its $21B acquisition of El Paso. UniCredit (UNCFF) has approved the terms of its closely watched share issue, with plans to offer 3.86B new shares at a steep 43% discount to current prices. The Italian bank is looking to raise €7.5B ($9.8B) as it seeks to meet capital requirements. Just days before its collapse, MF Global (MFGLQ) unloaded hundreds of millions of dollars of securities to Goldman Sachs, but was unable to get its hands on at least part of the cash as its clearing firm, JPMorgan, withheld the funds. American Tower (AMT) is assigned an Outperform with Wedbush. REITs: Morgan Keegan increases American Campus Communities (ACC), Kite Realty (KRG), and National Retail Properties (NNN), all to Outperform from Market Perform. Morgan Keegan reduces its ratings to Market Perform from Outperform on AvalonBay (AVB), Government Properties Income Trust (GOV), and Home Properties (HME). Pinnacle Financial (PNFP) is lowered to Hold from Buy with a $17 objective with Wunderlich. Visa (V) and Mastercard (MA) are each downgraded to Neutral from Buy at Janney Montgomery Scott. In afternoon trading: Shares of Life Partners (LPHI) are down about 18%.
The Financial Select Sector SPDR (XLF) was trading at $13.30 at 4:00 PM on Wednesday, down 0.30% on the day – up 2.31% year-to-date. The 2011 change was -18.50%; the weakest performing sector for the year.
Information Technology
Some tech giants are so opposed to the Stop Online Piracy Act [SOPA] that there’s been talk of a “nuclear option” whereby Google (GOOG), Amazon (AMZN), Yahoo (YHOO), eBay (EBAY) and others would simultaneously go dark to protest the legislation. Struggling Internet pioneer Yahoo Inc. (YHOO) named Scott Thompson, president of eBay Inc.’s PayPal unit, to be its next chief executive who will be tasked with turning around its core online-advertising business. Acme Packet (APKT) lowered its 2011 guidance yesterday, estimating revenue of $308M-$310M (versus consensus of $318M), and EPS of $1.03-$1.05 (versus consensus of $1.14). AT&T (T) agreed to pay $215M to settle a patent lawsuit against TiVo (TIVO), with around $51M to be paid up front and then the rest via regular payments through 2018. TiVo Inc (TIVO) is taken to Overweight from Equal Weight with a $12 target at Evercore. Groupon (GRPN) is a new Neutral and $19 price target at Collins Stewart. Fusion-io (FIO) is a fresh Hold at The Benchmark Company. Alcatel-Lucent (ALU) is taken to Neutral from Buy at Natixis. NetApp (NTAP) is now Neutral from Outperform at Credit Suisse. SAP AG (SAP) gets taken to Sell from Hold with a $46 target price at Ticonderoga. Visa (V) and Mastercard (MA) are each downgraded to Neutral from Buy at Janney Montgomery Scott. In afternoon trading: Shares of Acme Packet (APKT) are down about 19%. Shares of BroadSoft (BSFT) are down about 12.5%. Shares of Progress Software (PRGS) are down about 11.25%. Shares of Energy Conversion Devices (ENER) are up about 37.25%. Shares of TiVo are up about 10.25%.
The Technology Select Sector SPDR (XLK) was trading at $25.88 at 4:00 PM on Wednesday, up 0.27% on the day – up 1.69% year-to-date. The 2011 change was +1.03%.
Telecommunications Services
AT&T (T) agreed to pay $215M to settle a patent lawsuit against TiVo (TIVO), with around $51M to be paid up front and then the rest via regular payments through 2018. AT&T (T) is downgraded to Sector Perform from Outperform at Pacific Crest. Alcatel-Lucent (ALU) is taken to Neutral from Buy at Natixis. Clearwire (CLWR) is cut to Hold from Buy at Kaufman Brothers with a new, lower target of $2. In afternoon trading: Shares of Leap Wireless (LEAP) are down about 7.25%. Shares of MetroPCS (PCS) are down about 5.5%. Shares of AT&T are up about 0.7%, while shares of Sprint Nextel (S) are down about 1% and shares of Verizon (VZ) are down about a half of a percent.
The NASDAQ Telecommunications Index (IXTC) was trading at $201.06 at 4:00 PM on Wednesday, down 0.28% on the day – up 2.10% year-to-date. The 2011 change was -12.62%.
Utilities
In afternoon trading: Heavily Active Stocks: Shares of Genon Energy (GEN) are down about 2.3%%. Shares of Exelon (EXC) are down about 1.6%. Shares of Duke Energy (DUK) are down about a half of a percent. Shares of PPL Corp. (PPL) are down about 0.6%. Shares of FirstEnergy (FE) are down about 1.4%. Shares of AES Corp. (AES) are down about 0.7%. Shares of Southern Company (SO) are down slightly.
The Utilities Select Sector SPDR (XLU) was trading at $35.14 at 4:00 PM on Wednesday, down 0.57% on the day – down 2.33% year-to-date. The 2011 change was +14.81%; the strongest performing sector for the year.
STOCKS: APO, EP, KMI, CVX, BP, OILT, CF, AKS, STLD, CMP, MOS, POT, REE, GD, LMT, VWDRY, UNP, TBSI, GOOG, AMZN, YHOO, EBAY, EK, LIZ, IPG, AEO, AZO, CMG, DNKN, LULU, F, GM, WRC, VMED, EDMC, NFLX, CHD, ENR, MO, WMT, WAG, PG, CVS, GNOM, JAZZ, AMRN, VHS, PFE, BSX, KMI, UNCFF, MFGLQ, AMT, ACC, KRG, NNN, AVB, GOV, HME, PNFP, V, MA, LPHI, APKT, GRPN, FIO, ALU, NTAP, SAP, BSFT, PRGS, ENER, T, CLWR, LEAP, PCS, S, VZ, GEN, EXC, DUK, PPL, FE, AES, SO
