The Dow Jones Industrial Average opened below its 200-day simple moving average at 11,976 trading to a day’s low of 11,736.93 in afternoon trading. The NASDAQ gapped below its 200-day simple moving average at 2689 at Wednesday’s open trading between 2647.14 and 2672.34 before declining to 2619.19 in afternoon trading.
Asian stocks rebounded on Wednesday in anticipation that Italy’s PM Berlusconi will step down over debt woes. The Nikkei 225 gained 1.15% to 8,755 and the Hang Seng up 1.71% to 20,014. European stocks followed Asia higher at their opens, but gains were gone well before the US open as the euro declined versus the dollar. The FTSE 100 fell by 1.92% to 5,460 with the DAX crushed 2.21% to 5,830 and the CAC 40 down 2.17% to 3,075.
The US Treasury 10-Year yield declined from 2.089 percent to 1.927 back below its 50-day simple moving average at 2.042. The US Treasury auctioned $24 billion 10-Year notes at 2.030 with a weak bid to cover at 2.64 times. Tomorrow the US Treasury auctions $16 billion 30-Year bonds. Gold traded down to $1778.8 the Troy ounce in morning trade then rebounded to $1801.1 before weakening to $1765.3 in afternoon trading. Crude oil declined from $97.32 to $94.54 in early trading versus its 200-day simple moving average at $95.00 then rebounded to $97.84 as inventories declined. The euro versus the dollar declined from 1.3856 to 1.3527 below its 50-day simple moving average at 1.3740.
Energy
Suntech Power’s (STP) announced revenue was north of $800M (above a $780.7M consensus). Northern Oil & Gas (NOG) beat estimates by 24 cents. In afternoon trading: Shares of Northern Oil & Gas are down about 12.5%. Shares of ATP Oil & Gas (ATPG) are down about 12.5%. Shares of James River Coal (JRCC) are down about 8.75%. Shares of Weatherford International (WFT) are down about 7.75%. Shares of Patriot Coal (PCX) are down about 7.75%.
Energy Select Sector SPDR (XLE) was trading at $69.60 at 4:00 PM on Wednesday, down 4.42% on the day – up 1.98% year-to-date.
Materials
Silver Wheaton (SLW) missed estimates by 13 cents and revenue by $40M. AngloGold Ashanti (AU) beat estimates by 5 cents. Silvercorp (SVM) reported Q3 EPS of $0.14 (in-line), while missing revenue by $7M. Scotts Miracle-Gro (SMG) is now Neutral from Buy at Suntrust. In afternoon trading: Shares of Mechel OAO (MTL) are down about 11%. Shares of ArcelorMittal (MT) are down about 9.5%. Shares of Ashland (ASH) are down about 9.5%. Shares of Avalon Rare Metals (AVL) are down about 9.5%. Shares of Pan American Silver (PAAS) are down about 9.25%.
The Materials Select Sector SPDR (XLB) was trading at $33.96 at 4:00 PM on Wednesday, down 4.87% on the day – down 11.59% year-to-date.
Industrials
Powell Industries (POWL) announced it will restate its FQ2 and FQ3 results, due to accounting errors at its Canadian operations. Republic Airways (RJET) is raised to Buy from Hold at Dahlman Rose. In afternoon trading: Shares of Harsco (HSC) are down about 10.5%. Shares of Koninklijke (PHG) are down about 7.75%. Shares of Meritor (MTOR) are down about 7.75%. Shares of Terex (TEX) are down about 7.5%. Shares of American Semiconductor (AMSC) are up about 8%.
The Industrial Select Sector SPDR (XLI) was trading at $32.74 at 4:00 PM on Wednesday, down 3.88% on the day – down 6.11% year-to-date.
Consumer Discretionary
Polo Ralph Lauren (RL) beat estimates by 23 cents with revenue in-line with estimates. Wendy’s Arby’s Group (WEN) beat estimates by a penny, while missing revenue by $7M. Sodastream (SODA) reported Q3 revenue of $79.4M and EPS of $0.56 (beating consensus by $5M and $0.23). General Motors (GM) beat estimates by 8 cents, while missing revenue by $2.5B. Big Lots (BIG) is a Hold at Keybanc. H&R Block (HRB) is taken to Outperform from Perform at Oppenheimer with a $19 target price. Abercrombie & Fitch (ANF) is now Neutral from Buy at Suntrust. Blue Nile (NILE) is downgraded to Sell from Hold at Deutsche Bank. Dreamworks Animation (DWA) is moved to Sell from Neutral at Janney Montgomery Scott. In afternoon trading: Shares of Blue Nile are down about 30%. Shares of Maidenform Brands (MFB) are down about 29%. Shares of Beazer Homes (BZH) are down about 10%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $38.14 at 4:00 PM on Wednesday, down 3.57% on the day – up 1.95% year-to-date.
Consumer Staples
Dean Foods (DF) beat estimates by 3 cents and revenue by $100M. Rite Aid (RAD) is upgraded to Outperform from Neutral at Credit Suisse. Walgreens (WAG) is lowered to Neutral from Outperform at Credit Suisse. Central European Distribution Corp (CEDC) is cut to Hold from Buy at Deutsche Bank. In afternoon trading: Sahres of PriceSmart (PSMT) are down about 13.5%. Shares of Central European Distribution are down about 8%. Shares of Pilgrim’s Pride (PPC) are down about 7%. Shares of Dean Foods are down about 6.75%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $30.82 at 4:00 PM on Wednesday, down 2.34% on the day – up 5.15% year-to-date.
Healthcare
Aegerion Pharmaceuticals (AEGR) is initiated with a Buy at Deutsche Bank. Amylin Pharmaceuticals (AMLN) is upgraded to Outperform from Market Perform at BMO Capital. McKesson (MCK) is added to the Conviction Buy list at Goldman Sachs. AmerisourceBergen (ABC) is removed from Goldman’s list of Conviction Buys. In afternoon trading: Shares of Olympus (OCPNY) are down about 20%. Shares of Accretive Health (AH) are down about 11.25%. Shares of Zalicus (ZLCS) are down about 9.25%. Shares of Gentiva Health Services (GTIV) are up about 12.5%.
The Health Care Select Sector SPDR (XLV) was trading at $33.01 at 4:00 PM on Wednesday, down 2.88% on the day – up 4.79% year-to-date.
Financials
Goldman Sachs (GS) is seeking to raise up to $1.54B by offering 2.4B shares in Industrial & Commercial Bank of China (IDCBF), a move that would exploit a 50% recovery in the latter’s shares since October. General Growth Properties (GGP) beat estimates by a penny with revenue in-line with estimates. HSBC (HBC) reported Q3 net profit +66% to $5.22B (versus forecasts of $3.84B), boosted by a $4.1B accounting gain related to the value of its debt. H&R Block (HRB) is taken to Outperform from Perform at Oppenheimer with a $19 target price. Lloyds Banking (LYG) is lifted to Buy from Add at WestLB. Hartford Financial (HIG) is lifted to Overweight from Equal Weight at Morgan Stanley. Principal Financial (PFG) is moved to Underweight from Equal Weight at Morgan Stanley, which reduces its Prudential (PRU) recommendation to Equal Weight from Overweight. Charles Schwab (SCHW) is cut to Hold from Buy at ISI Group. In afternoon trading: Shares of MF Global (MFGLQ) are down about 13%. Shares of Ambac Financial (ABKFQ) are down about 13%. Shares of ING Group (ING) are down about 12.25%.
The Financial Select Sector SPDR (XLF) was trading at $12.87 at 4:00 PM on Wednesday, down 5.44% on the day – down 19.31% year-to-date.
Information Technology
AOL (AOL), Microsoft (MSFT) and Yahoo (YHOO) have agreed to share access to each other’s premium unsold ad inventory as they look to overcome the increasing dominance of Google (GOOG) and Facebook. Cisco (CSCO) is due to report FQ1 earnings after the bell today, with analysts expecting that EPS grew to $0.40 from $0.34 a year earlier and that revenue rose to $11.03B from $10.75B. SA author Vatalyst says the results “will give investors the clearest indication yet on whether the company has turned the corner” after a difficult year that it has spent retrenching and refocusing on its core operations. Universal Display (PANL) beat Q3 estimates and guided for Q4 revenue of $15.4M-$19.4M ($15.3M consensus). Adobe (ADBE) expects FY12 revenue growth of 4%-6% (below a 9% consensus). NetSuite (N) is a new Outperform with Wells Fargo. SolarWinds (SWI) is boosted to Buy from Hold with a $36 target at Needham. Autodesk (ADSK) is now Neutral from Buy at Bank of America-Merrill Lynch. Dolby Labs (DLB) is downgraded to Neutral from Overweight at Piper Jaffray. NVIDIA (NVDA) is moved to Market Perform from Outperform at JMP Securities. In afternoon trading: Shares of Intralinks Holdings (IL) are down about 37.5%. Shares of Rovi (ROVI) are down about 36.5%. Shares of Energy Conversion Devices (ENER) are down about 32.75%. Shares of KIT Digital (KITD) are up about 27%.
The Technology Select Sector SPDR (XLK) was trading at $25.59 at 4:00 PM on Wednesday, down 3.47% on the day – up 1.59% year-to-date.
Telecommunications Services
Alaska Communications (ALSK) is downgraded by both RBC Capital (Underperform from Sector Perform) and Bank of America-Merrill Lynch (Underperform from Neutral). In afternoon trading: Shares of Alaska Communications are down about 25%. Shares of Telecom Italia (TI) are down about 8.5%. Shares of Mobile Telesystems (MBT) are down about 6.75%. Shares of Telefonica (TEF) are down about 5.75%. Shares of France Telecom (FTE) are down about 5.75%. Shares of TerreStar (TSTRQ) are up about 10.5%.
The NASDAQ Telecommunications Index (IXTC) was trading at $198.09 at 4:00 PM on Wednesday, down 3.54% on the day – down 12.10% year-to-date.
Utilities
In afternoon trading: Shares of Veolia Environment (VE) are down about 10.75%. Shares of Dynegy (DYN) are down about 8.5%. Shares of Genon Energy (GEN) are down about 5.5%. Shares of AES Corp (AES) are down about 4.75%. Shares of Calpine (CPN) are down about 4.25%. Actives: Shares of Duke Energy (DUK) are down about 1.25%. Shares of Exelon (EXC) are down about a half of a percent.
The Utilities Select Sector SPDR (XLU) was trading at $34.63 at 4:00 PM on Wednesday, down 2.18% on the day – up 10.50% year-to-date.
STOCKS: STP, NOG, ATPG, JRCC, WFT, PCX, SLW, AU, SVM, SMG, MTL, MT, ASH, AVL, PAAS, POWL, RJET, HSC, PHG, MTOR, TEX, AMSC, RL, WEN, SODA, GM, BIG, HRB, ANF, NILE, DWA, MFB, BZH, DF, RAD, WAG, CEDC, PSMT, PPC, AEGR, AMLN, MCK, ABC, OCPNY, AH, ZLCS, GTIV, GS, IDCBF, GGP, HBC, LYG, HIG, PFG, PRU, SCHW, MFGLQ, ABKFQ, ING, AOL, MSFT, YHOO, GOOG, CSCO, PANL, ADBE, N, SWI, ADSK, DLB, NVDA, IL, ROVI, ENER, KITD, ALSK, TI, MBT, TEF, FTE, TSTRQ, VE, DYN, GEN, AES, CPN, DUK, EXC
