Equities Sector Coverage: Wall Street Sags on Concerns of Economic Growth

Sector Recap  |

Non-manufacturing ISM came in weaker than expected at 57.3 with prices paid up to 68.4 and employment slipping to 55.7. Factory Orders fell 1.0% in January. The Dow Jones Industrial Average declined to 12,883.91 in morning trading then consolidated weakness in the afternoon with an attempt to return to the flat line into the final half hour of trading. The NASDAQ declined to 2940.52 in morning trading then consolidated in afternoon trading but entered the final half hour of trading solidly in the red. Dow Transports and Russell 2000 continue to lag their 2011 all time highs at 5627.85 and 868.57 respectively.

Asian stocks were lower on Monday as China cuts their GDP target. The Nikkei 225 ended their session at 9,699 – down 0.80% on the day. The Hang Seng ended their session at 21,265 – down 1.38% on the day. European stocks were lower as a Greek default looks increasingly likely. The FTSE 100 ended their session at 5,875 – down 0.61% on the day, the DAX ended their session at 6,866 down 0.79% on the day, and the CAC 40 ended their session at 3,488 – down 0.39% on the day. The yield on the 10-Year US Treasury rose from 1.962 percent to 2.009 staying above its 50-day simple moving average at 1.948.

Gold traded down from $1718.0 the Troy ounce to $1694.4 with the 50-day and 200-day simple moving averages at $1687.1 and $1672.0. Crude oil traded down to $105.50 per barrel then rebounded to $107.42. The euro versus the dollar rebounded from 1.3163 to 1.3237.

Energy

BP (BP) has agreed to an uncapped settlement with thousands of plaintiffs in the Deepwater Horizon oil spill trial, estimating its costs will come to $7.8B. Atwood Oceanics (ATW) is moved to Outperform from Market Perform with Wells Fargo.

Energy Select Sector SPDR (XLE) was trading at $74.26 at 4:00 PM on Monday, down 0.64% on the day – up 7.42% year-to-date. The February 2012 change was +5.93%. The 2011 change was -1.29%

Big Movers: (CSIQ) -8.75%, (PCX) -8.75%, (JRCC) -7.75%, (DNN) -7.5%.

Materials

Glencore (GLCNF) has said its $37B takeover of Xstrata (XSRAY) is "fair" for all shareholders at current levels, dashing hopes of a sweeter offer. Sonoco Products (SON) is upgraded to Overweight from Neutral at JP Morgan. BASF AG (BASFY) gets cut to Neutral from Buy by Citigroup. CF Industries (CF) is now to Neutral from Buy at Citigroup.

The Materials Select Sector SPDR (XLB) was trading at $36.69 at 4:00 PM on Monday, down 1.61% on the day – up 9.52% year-to-date. The February 2012 change was -0.56%. The 2011 change was -12.78%.

Heavily Traded: (FCX) -4.1%, (AA) -3.6%, (VALE) -4.1%, (CX) -1.2%.

Industrials

Lockheed Martin (LMT) gets lifted to Outperform from Underperform at RBC Capital. Sykes Enterprises (SYKE) is raised to Outperform from Neutral at Robert W. Baird, which establishes a price objective of $18.
The Industrial Select Sector SPDR (XLI) was trading at $36.88 at 4:00 PM on Monday, down 0.70% on the day – up 9.27% year-to-date. The February 2012 change was +2.79%. The 2011 change was -3.21%.

Big Movers: (AONE) -12%, (PPO) -11.25%.
Heavily Traded: (GE) -0.7%, (GLW) -0.9%, (LCC) -8%.

Consumer Discretionary

Harman International (HAR) is a new Underweight at Morgan Stanley. Big Lots (BIG) is now Buy from Neutral at Northcoast. Darden Restaurants (DRI) is added to Bank of America-Merrill Lynch’s US 1 List of favored equities. PF Chang’s (PFCB) is named a long Research Tactical Idea at Morgan Stanley. HomeAway (AWAY) is lifted to Buy from Neutral at Citigroup. Pandora Media (P) is raised to Buy from Hold at Stifel Nicolaus with a price objective of $18. Toyota Motor (TM) is taken to Outperform from Neutral at Credit Suisse. Build-A-Bear Workshop (BBW) is downgraded to Market Perform from Outperform by BMO Capital.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $43.48 at 4:00 PM on Monday, down slightly on the day – up 11.43% year-to-date. The February 2012 change was +10.09%. The 2011 change was +4.30%.

Big Mover: (ARCL) +22%.

Consumer Staples

Coca-Cola Hellenic Bottling (CCH) is raised to Neutral from Underweight at JP Morgan.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.36 at 4:00 PM on Monday, up 0.45% on the day – up 2.68% year-to-date. The February 2012 change was +3.75%. The 2011 change was +10.85%.

Heavily Traded: (SVU) -4.6%, (SLE) -2%, (WMT) +1%, (WAG) +2%, (SWY) +1.5%.

Health Care

Perrigo (PRGO) gets increased to Buy from Hold at Canaccord Genuity. Ironwood Pharmaceuticals (IRWD) is downgraded to Underperform from Outperform with Wedbush.
The Health Care Select Sector SPDR (XLV) was trading at $36.23 at 4:00 PM on Monday, down 0.22% on the day – up 4.44% year-to-date. The February 2012 change was +1.06%. The 2011 change was +10.32%.

Big Movers: (KERX) +33.25%, (AEZS) +21.25%.
Heavily Traded: (PFE) +0.6%, (MRK) +1.6%.

Financials

AIG (AIG) is selling around $6B of AIA shares to help repay its government bailout. AIG will hold about 19% of AIA after the stock sale. Credit Suisse (CS) plans to repurchase up to 4B Swiss francs ($4.4B) in outstanding public tier 1 and tier 2 securities. The buyback is part of the bank's efforts to conform to the new Swiss and Basel III global capital adequacy rules. While other banks consolidate their bases and exit international positions, Wells Fargo (WFC) has drafted plans to expand its overseas operations and wants to move into 20 markets worldwide. Allstate (ALL) gets a Buy-from-Hold hoist at Argus, which sets it a $36 target price. MetLife (MET) is added to the US 1 List by Bank of America-Merrill Lynch. Weyerhaeuser (WY) is lifted to Market Perform from Underperform by BMO Capital. Summit Hotel (INN) is slashed to Sector Perform from Outperform at RBC Capital. Vornado Realty Trust (VNO) is reduced to Neutral from Buy at UBS.

The Financial Select Sector SPDR (XLF) was trading at $14.81 at 4:00 PM on Monday, down 0.37% on the day – up 13.92% year-to-date. The February 2012 change was +5.02%. The 2011 change was -18.50%; the weakest performing sector for the year.
Big Movers: (WAMUQ) -9.25%, (LEHMQ) +9%.

Information Technology

Advanced Micro Devices (AMD) has amended its wafer-supply agreement with Globalfoundries and will take a one-time charge of $703M in Q1. AMD's Q1 2012 non-GAAP gross margin guidance of around 45% and the 2012 non-GAAP gross margin guidance of 44%-48% remain unchanged. More than 25B apps have been downloaded from Apple's (AAPL) store since it was first launched four years ago, the company said yesterday. Meanwhile, Senator Charles Schumer has asked the FTC to investigate claims that apps downloaded to Apple (AAPL) and Android (GOOG) devices steal private contacts and photos, and post them online without consent. Monster Worldwide (MWW) and Dice Holdings (DHX) are both initiated with Outperforms at BMO Capital. Guidewire Software (GWRE) is begun with a Buy at Deutsche Bank, a Neutral at Citigroup, and an Overweight at JP Morgan. Aixtron (AIXG) is raised by both WestLB (Neutral from Reduce) and Canaccord Genuity (Hold from Sell). Jabil Circuit (JBL) is now Buy from Strong Buy at Needham on valuation. Zynga (ZNGA) is now Neutral from Overweight at JPMorgan.

The Technology Select Sector SPDR (XLK) was trading at $28.83 at 4:00 PM on Monday, down 0.86% on the day – up 13.28% year-to-date. The February 2012 change was +7.08%. The 2011 change was +1.03%.

Big Movers: (PEGA) +34%, (CYDE) +32%, (MWW) +13%.

Telecommunication Services

Alaska Communications (ALSK) is upgraded to Sector Perform from Underperform at RBC Capital. MetroPCS (PCS) and Leap Wireless (LEAP) are each moved to Market Perform from Outperform by Sanford Bernstein.

The NASDAQ Telecommunications Index (IXTC) was trading at $210.46 at 4:00 PM on Monday, down 0.92% on the day – up 6.87% year-to-date. The February 2012 change was +1.63%. The 2011 change was -12.62%.

Heavily Traded: (T) +0.5%, (S) -2%, (VZ) +1.4%.

Utilities

CH Energy (CHG) is taken to Hold from Buy at Brean Murray due to valuation concerns. CenterPoint Energy (CNP) is reduced to Sector Perform from Outperform at RBC Capital.

The Utilities Select Sector SPDR (XLU) was trading at $35.04 at 4:00 PM on Monday, relatively up 0.23% on the day – down 2.61% year-to-date. The February 2012 change was +0.61%. The 2011 change was +14.81%; the strongest performing sector for the year.

Heavily Traded: (CNP) -1%, (DUK) +0.4%, (POM) flat.

STOCKS: BP, ATW, CSIQ, PCX, JRCC, DNN, GLCNF, XSRAY, SON, BASFY, CF, FCX, AA, VALE, CX, LMT, SYKE, AONE, PPO, GE, GLW, LCC, HAR, BIG, DRI, PFCB, AWAY, P, TM, BBW, ARCL, CCH, SVU, SLE, WMT, WAG, SWY, PRGO, IRWD, KERX, AEZS, PFE, MRK, AIG, CS, WFC, ALL, MET, WY, INN, VNO, WAMUQ, LEHMQ, AMD, AAPL, GOOG, MWW, DHX, GWRE, AIXG, JBL, ZNGA, PEGA, CYDE, ALSK, PCS, LEAP, T, S, VZ, CHG, CNP, DUK, POM

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
DNN Denison Mines Corp (Canada) 0.47 -0.00 -0.67 205,270
INN Summit Hotel Properties Inc. 11.81 -0.24 -1.99 1,105,025 Trade
GLW Corning Incorporated 29.52 -0.01 -0.03 3,929,380 Trade
CF CF Industries Holdings Inc. 48.91 0.33 0.68 1,867,865 Trade
LMT Lockheed Martin Corporation 382.84 0.09 0.02 855,112 Trade
TM Toyota Motor Corporation 136.76 -0.11 -0.08 172,679 Trade
GE General Electric Company 8.90 0.01 0.11 58,156,151 Trade
SON Sonoco Products Company 58.27 0.76 1.32 486,220 Trade
VALE VALE S.A. American Depositary Shares Each Representing one 11.21 -0.23 -2.01 23,007,738 Trade
AA Alcoa Corporation 19.16 -0.30 -1.54 7,583,571 Trade
CNP CenterPoint Energy Inc (Holding Co) 28.62 0.44 1.56 6,329,411 Trade
AER Aercap Holdings N.V. 55.52 0.80 1.46 646,696 Trade
BIG Big Lots Inc. 21.78 -0.36 -1.63 721,864 Trade
ALSK Alaska Communications Systems Group Inc. 1.69 0.04 2.42 42,470 Trade
PEGA Pegasystems Inc. 74.71 -1.28 -1.68 499,860 Trade
S Sprint Corporation 6.44 -0.04 -0.62 10,553,543 Trade
MET MetLife Inc. 45.96 -0.23 -0.50 4,348,594 Trade
VNO Vornado Realty Trust 62.95 -0.51 -0.80 968,882 Trade
AMD Advanced Micro Devices Inc. 30.81 0.09 0.29 43,094,172 Trade
WY Weyerhaeuser Company 27.70 0.47 1.73 3,647,386 Trade
SYKE Sykes Enterprises Incorporated 30.00 0.14 0.47 84,775 Trade
VZ Verizon Communications Inc. 60.29 -0.26 -0.43 9,330,896 Trade
MWW Monster Worldwide Inc. n/a n/a n/a 0 Trade
BBW Build-A-Bear Workshop Inc. 3.70 -0.12 -3.14 284,585 Trade
GOOG Alphabet Inc. 1,243.64 0.63 0.05 1,168,594 Trade
FCX Freeport-McMoRan Inc. 9.50 -0.02 -0.21 17,292,257 Trade
DHX DHI Group Inc. 3.44 -0.07 -1.99 216,539 Trade
AWAY HomeAway Inc. n/a n/a n/a 0 Trade
JBL Jabil Inc. 36.04 -0.45 -1.23 1,203,940 Trade
GWRE Guidewire Software Inc. 109.48 -0.82 -0.74 1,069,397 Trade
ALL Allstate Corporation (The) 107.49 -0.58 -0.54 1,337,595 Trade
AEZS AEterna Zentaris Inc. 0.88 0.00 0.00 174,736 Trade
PFE Pfizer Inc. 36.34 -0.16 -0.44 13,722,576 Trade
IRWD Ironwood Pharmaceuticals Inc. 8.93 -0.11 -1.16 1,057,716 Trade
POM Pepco Holdings Inc. n/a n/a n/a 0 Trade
ZNGA Zynga Inc. 6.20 0.01 0.08 21,038,899 Trade
WFC Wells Fargo & Company 49.59 -0.52 -1.04 23,759,914 Trade
PRGO Perrigo Company plc 53.93 0.12 0.22 722,695 Trade
AIG American International Group Inc. 54.34 -0.34 -0.62 3,470,054 Trade
CSIQ Canadian Solar Inc. 18.18 -0.51 -2.70 471,325 Trade
MRK Merck & Company Inc. (new) 84.45 -0.59 -0.69 5,461,542 Trade
DRI Darden Restaurants Inc. 110.00 -0.29 -0.26 1,154,205 Trade
BP BP p.l.c. 37.21 -0.15 -0.40 4,819,272 Trade
T AT&T Inc. 37.79 -0.11 -0.29 22,152,571 Trade
DUK Duke Energy Corporation (Holding Company) 95.13 0.13 0.14 2,618,800 Trade
HAR Harman International Industries Incorporated n/a n/a n/a 0 Trade
CX Cemex S.A.B. de C.V. Sponsored ADR 4.13 0.02 0.49 3,533,600 Trade
WMT Walmart Inc. 119.42 -0.11 -0.09 4,144,280 Trade
AAPL Apple Inc. 234.37 -0.95 -0.40 19,305,869 Trade

Comments

Watchlist

Symbol Last Price Change % Change
AAPL

     
AMZN

     
HD

     
JPM

     
IBM

     

What Is Petrolithium?

MGX Minerals explains the advantages of petrolithium and how they are helping to solve future problems today.