Equities Sector Coverage: Wall Street Stays Flat After Enduring Tough Week

Sector Recap  |

The Dow Jones Industrial Average traded above its 200-day simple moving average at 11,939 on Friday, as the 50-day remains a support at 11,809. The close was below its 200-day. The NASDAQ rebounded to a day’s high at 2585.42, but remains well below its 50-day and 200-day simple moving averages at 2616 and 2665.

Asian stocks rebounded on Friday with the Nikkei 225 ending the day at 8,402 – up 0.29%, and the Hang Seng ending the day at 18,285 – up 1.43%. European stocks were mixed on Friday. The FTSE 100 ended the day at 5,404 – up 0.06%; the DAX ended the day at 5,714 - down 0.29%; and the CAC 40 ended the day at 2,972 – down 0.88%. The yield on the 10-Year US Treasury note traded down from 1.941 percent to 1.844 as the CPI was reported as flat in November.

Gold rebounded from $1572.1 the Troy ounce to $1603.5 staying below its 200-day simple moving average at $1615.3. Crude oil traded down from $94.79 per barrel to $93.08 below its 50-day and 200-day simple moving averages at $94.46 and $95.89. The euro versus the dollar traded between 1.3007 and 1.3083 staying above its January 2011 low at 1.2878.

Energy

Enbridge Inc (ENB) is picked with a Neutral at Citigroup. Enduro Royalty Trust (NDRO) is resumed at Outperform and $23 target at Robert W. Baird. HollyFrontier (HFC) is a Buy at Citigroup. Transocean (RIG) is raised to Neutral from Reduce at Global Hunter Securities with a $43 objective. Kosmos Energy (KOS) is upgraded to Overweight from Equal Weight by Barclays. Basic Energy Services (BAS) gets a Buy-from-Hold boost at Dahlman Rose with a new target of $25. In afternoon trading: Shares of Cobalt International Energy (CIE) are up about 20.5%.

Energy Select Sector SPDR (XLE) was trading at $66.14 at 4:00 PM on Friday, up 0.64% on the day – down 3.09% year-to-date.

Materials

ArcelorMittal (MT) is resumed with a Buy at Royal Bank of Scotland. Southern Copper (SCCO) is started with an Equal Weight with Morgan Stanley. SunCoke Energy (SXC) is begun with a Buy recommendation and $15 objective at KeyBanc Capital. AK Steel (AKS) is upgraded to Outperform from Market Perform with Wells Fargo. In afternoon trading: Heavily Active Stocks: Shares of Alcoa (AA) are relatively unchanged. Shares of Freeport McMoran (FCX) are up about 0.3%.

The Materials Select Sector SPDR (XLB) was trading at $32.53 at 4:00 PM on Friday, down slightly on the day – down 15.31% year-to-date.

Industrials

United Rentals (URI) is to acquire RSC Holdings (RRR) in a cash-and-stock transaction for a total enterprise value of $4.2B, including $2.3B in net debt – ($18 / share - 58% premium). Avis Budget (CAR) is begun with an Equal Weight at Barclays. Jefferies has a Hold on Packaging Corp of America (PKG) and rolls out Buy rated research on Rock-Tenn Co (RKT). TransDigm Group (TDG) is a new Neutral at Goldman Sachs. In afternoon trading: Shares of RSC Holdings are up about 56%.

The Industrial Select Sector SPDR (XLI) was trading at $32.67 at 4:00 PM on Friday, down 0.24% on the day – down 6.31% year-to-date.

Consumer Discretionary

The handheld PlayStation Vita is due to hit stores in Japan tomorrow in Sony's (SNE) biggest product launch since the PlayStation 3 about five years ago. Darden Restaurants (DRI) missed estimates by a penny with revenues in-line with estimates. Carnival Corporation (CCL) is upgraded to Overweight from Neutral at HSBC Securities with a new target of $38. Liberty Global (LBTYA) is lifted to Overweight from Neutral at JPMorgan. Cablevision (CVC) is cut 180 degrees, to Underperform from Buy at Bank of America-Merrill Lynch. DirecTV (DTV) is now Neutral from Overweight at Atlantic Equities. In afternoon trading: Shares of Morton’s Restaurant Group (MRT) are up about 32.5%. Shares of American Apparel (APP) are up about 12%. Shares of Quicksilver (ZQK) are up about 11%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $37.90 at 4:00 PM on Friday, down 0.58% on the day – up 1.31% year-to-date.

Consumer Staples

Cantor Fitzgerald starts Sell rated coverage on Safeway (SWY), assigning it a price objective of $16. The broker has Holds on Kroger (KR) - $24 target price and Sysco Corp (SYY) - $29 target price and begins Supervalu (SVU) with a Buy and $10 target. Central European Distribution Corp (CEDC) gets moved to Equal Weight from Underweight at Morgan Stanley. In afternoon trading: Shares of Altria Group (MO) are down about 0.2%. Shares of Wal-Mart (WMT) are up about 0.3%. Shares of Procter & Gamble (PG) are up slightly. Shares of CVS Caremark (CVS) are up about 1%. Shares of Kraft Foods (KFT) are down about 0.25%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $31.49 at 4:00 PM on Friday, down 1.01% on the day – up 7.44% year-to-date.

Healthcare

Amgen (AMGN) CEO Kevin Sharer will retire in May and be replaced by company President and COO Robert Bradway. Annual revenue at the biotech has risen to $16B from $3.6B in 2000, when Sharer took over, but the share price is 4.9% lower. Thoratec (THOR) is a Neutral at Goldman. Amgen (AMGN) gets a Neutral-from-Sell increase at Goldman. AthenaHealth (ATHN) is raised to Perform from Underperform at Oppenheimer. ZOLL Medical (ZOLL) is moved to Equal Weight from Overweight at First Analysis. In afternoon trading: Shares of StemCells (STEM) are down about 39%. Shares of Inhibitex (INHX) are down about 17.5%. Shares of InterMune (ITMN) are down about 13%. Shares of Affymax (AFFY) are down about 11.25%.

The Health Care Select Sector SPDR (XLV) was trading at $33.41 at 4:00 PM on Friday, down 0.89% on the day – up 6.06% year-to-date.

Financials

Fitch has downgraded the credit ratings of eight major Western banks to A from either A+ or AA-, including Bank of America (BAC), Barclays BCS, Goldman Sachs (GS) and Morgan Stanley (MS). Lehman is suing Bank of America (BAC) and Barclays (BCS) for breach of contract and is seeking an injunction preventing them from selling a 26.5% stake in apartment company Archstone to rival Equity Residential (EQR) for $1.33B. Discover Financial Services (DFS) gets begun with a Buy at Guggenheim. UBS begins Buys on U.S Bancorp (USB) and State Street (STT). Its new Neutrals include Wells Fargo (WFC), Bank of New York Mellon (BK), Northern Trust (NTRS), and Regions Financial (RF). Wells Fargo has fresh Market Performs on First Cash Financial (FCFS) and EZCORP Inc (EZPW). It establishes Outperforms on Cash America International (CSH) and DFC Global (DLLR). Morgan Keegan initiates Outperforms on Green Dot (GDOT) - $36 target and NetSpend (NTSP) - $9 target. Ocwen Financial (OCN) is launched at a Buy at Bank of America-Merrill Lynch. Duff & Phelps (DUF) gets downgraded to Market Perform from Outperform at Keefe Bruyette.

The Financial Select Sector SPDR (XLF) was trading at $12.54 at 4:00 PM on Friday, down 0.24% on the day – down 21.38% year-to-date.

Information Technology

Zynga (ZNGA) is set to debut on the Nasdaq today after pricing its IPO at the top end of its range at $10 a share, giving the company a market cap of $8.9B. Research In Motion (RIMM) beat estimates by 8 cents, with revenue in-line with estimates. The company expects Q4 revenue of $4.6B-$4.9B and EPS of $0.80-$0.95. FQ4 revenue and EPS forecasts well below a consensus of $5.27B and $1.19. Adjusted FQ3 EPS fell 27% to $1.27 as revenue slipped 5.5% to $5.17B, and RIM took a big charge on its woeful PlayBook tablet launch. Electronic Arts (ERTS) will change its Nasdaq ticker to "EA," effective from Tuesday morning. Accenture (ACN) beats estimates by 2 cents and revenue by $760M. The company cuts its FQ2 forecast – now expecting revenues to be in the range of $6.5B - $6.8B. Adobe (ADBE) beat estimates by 7 cents and revenue of $60M. The company expects FQ1 revenue of $1.025B-$1.075B and EPS of $0.54-$0.59 (in-line with a consensus of $1.05B and $0.58). Qualcomm (QCOM) is a new Buy at Lazard. Linear Technology (LLTC) is taken to Outperform from Perform with a $36 price target at Oppenheimer. FleetCor (FLT) is moved to Outperform from Market Perform at Wells Fargo. Yahoo (YHOO) is downgraded to Equal Weight from Overweight at Evercore. Research In Motion (RIMM) is reduced to Market Perform from Outperform by BMO Capital this morning. Ericsson (ERIC) gets taken to Neutral from Buy at UBS. SAP AG (SAP) is now Neutral from Buy at Bank of America-Merrill. In afternoon trading: Shares of Research in Motion are down about 11.5%. Shares of CryptoLogic (CRYP) are up about 42.5%.

The Technology Select Sector SPDR (XLK) was trading at $24.98 at 4:00 PM on Friday, down slightly on the day – down 0.83% year-to-date.

Telecommunications Services

In afternoon trading: Heavily Active Stocks: Shares of AT&T (T) are down about 0.3%. Shares of Sprint Nextel (S) are down about 1.5%. Shares of Clearwire (CLWR) are up about 2%. Shares of Verizon (VZ) are up about 0.2%. Shares of Frontier Communications (FTR) are up about 3.2%.

The NASDAQ Telecommunications Index (IXTC) was trading at $192.58 at 4:00 PM on Friday, down 0.36% on the day – down 14.55% year-to-date.

Utilities

In afternoon trading: Heavily Active Stocks: Shares of Duke (Energy (DUK) are up about 0.4%. Shares of Exelon (EXC) are down about 1.1%. Shares of PG&E (PCG) are up about 0.3%. Shares of AES Corp (AES) are down about 0.7%. Shares of Genon Energy (GEN) are up about 0.2%. Shares of Constellation Energy Group (CEG) are down about 2%. Shares of Southern Company (SO) are down about 0.6%.

The Utilities Select Sector SPDR (XLU) was trading at $34.54 at 4:00 PM on Friday, down 1.40% on the day – up 10.21% year-to-date.

STOCKS: ENB, NDRO, HFC, RIG, KOS, BAS, CIE, MT, SCCO, SXC, AKS, AA, FCX, URI, RRR, CAR, PKG, PKT, TDG, SNE, DRI, CCL, LBTYA, CVC, DTV, MRT, APP, ZQK, SWY, KR, SYY, SVU, CEDC, MO, WMT, PG, CVS, KFT, AMGN, THOR, ATHN, ZOLL, STEM, INHX, ITMN, AFFY, BAC, GS, MS, BCS, EQR, DFS, USB, STT, WFC, BK, NTRS, RF, FCFS, EZPW, CSH, DLLR, GDOT, NTSP, OCN, DUF, ZNGA, RIMM, ERTS, ACN, ADBE, QCOM, LLTC, FLT, YHOO, ERIC, SAP, CRYP, T, S, CLWR, VZ, FTR, DUK, EXC, PCG, AES, GEN, CEG, SO

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
CCL Carnival Corporation 48.84 -0.53 -1.07 3,222,327 Trade
GEN Genesis Healthcare Inc. 1.42 0.01 0.71 219,750 Trade
FTR Frontier Communications Corporation 1.09 -0.05 -4.39 1,076,915 Trade
EZPW EZCORP Inc. 8.25 -0.06 -0.72 239,824 Trade
KR Kroger Company (The) 25.22 -0.43 -1.68 7,458,875 Trade
PG Procter & Gamble Company (The) 121.41 0.25 0.21 5,788,412 Trade
SO Southern Company (The) 60.80 0.25 0.41 3,909,885 Trade
PCG Pacific Gas & Electric Co. 11.75 0.59 5.29 9,465,693 Trade
AKS AK Steel Holding Corporation 2.52 -0.13 -4.91 12,597,319 Trade
RIG Transocean Ltd (Switzerland) 5.92 -0.10 -1.66 18,611,142 Trade
VNET 21Vianet Group Inc. 8.42 -0.22 -2.55 114,619 Trade
PKG Packaging Corporation of America 104.68 -0.34 -0.32 621,788 Trade
AA Alcoa Corporation 21.67 -0.36 -1.63 4,160,726 Trade
MO Altria Group Inc. 40.84 -0.47 -1.14 13,310,662 Trade
CVC Cablevision Systems Corporation Class A n/a n/a n/a 0 Trade
BCS Barclays PLC 7.36 -0.12 -1.60 4,485,687 Trade
S Sprint Corporation 6.73 -0.05 -0.74 12,096,574 Trade
ACN Accenture plc Class A (Ireland) 194.13 -0.82 -0.42 1,895,580 Trade
ADBE Adobe Inc. 279.72 -4.97 -1.75 7,479,171 Trade
CSH Cash America International Inc. n/a n/a n/a 0 Trade
MS Morgan Stanley 44.36 0.15 0.34 8,327,576 Trade
URI United Rentals Inc. 124.71 -2.19 -1.73 2,014,566 Trade
SYY Sysco Corporation 78.86 0.48 0.61 3,151,126 Trade
SCCO Southern Copper Corporation 34.68 -0.24 -0.69 890,903 Trade
ERIC Ericsson 8.15 0.10 1.24 5,085,900 Trade
AES The AES Corporation 16.05 0.16 1.01 3,881,240 Trade
EQR Equity Residential of Beneficial Interest 85.27 -0.60 -0.70 1,850,405 Trade
NDRO PVL Barrick Gold Corporation n/a n/a n/a 0
GS Goldman Sachs Group Inc. (The) 217.08 1.17 0.54 2,492,485 Trade
VZ Verizon Communications Inc. 59.93 0.06 0.10 8,660,008 Trade
ENB Enbridge Inc 35.19 -0.06 -0.17 3,038,902 Trade
GDOT Green Dot Corporation Class A $0.001 par value 27.31 -0.17 -0.62 515,660 Trade
BAC Bank of America Corporation 30.00 0.06 0.20 66,748,930 Trade
USB U.S. Bancorp 55.91 0.01 0.02 3,851,247 Trade
HFC HollyFrontier Corporation 53.05 0.01 0.02 1,633,832 Trade
LLTC Linear Technology Corporation n/a n/a n/a 0 Trade
FCX Freeport-McMoRan Inc. 10.36 -0.05 -0.48 26,313,146 Trade
BK Bank of New York Mellon Corporation (The) 47.00 0.65 1.40 4,667,941 Trade
SXC SunCoke Energy Inc. 6.82 -0.32 -4.48 824,048 Trade
RF Regions Financial Corporation 16.35 0.09 0.55 12,910,367 Trade
OCN Ocwen Financial Corporation 1.95 -0.01 -0.51 414,013 Trade
AMGN Amgen Inc. 195.04 -1.68 -0.85 1,912,113 Trade
FLT FleetCor Technologies Inc. 295.14 -2.12 -0.71 626,949 Trade
ZNGA Zynga Inc. 6.04 0.00 0.00 28,105,162 Trade
TDG Transdigm Group Incorporated Inc. 530.38 4.79 0.91 332,789 Trade
WFC Wells Fargo & Company 48.93 0.17 0.35 20,548,852 Trade
MT Arcelor Mittal NY Registry Shares NEW 16.10 -0.18 -1.11 3,310,041 Trade
LBTYA LBYAV Liberty Global plc Class A Ordinary Shares 27.35 -0.37 -1.33 2,004,699 Trade
STEM StemCells Inc. n/a n/a n/a n/a
YHOO Yahoo! Inc. n/a n/a n/a 0 Trade
KOS Kosmos Energy Ltd. (DE) 6.57 0.04 0.61 5,303,459 Trade
DFS Discover Financial Services 84.31 0.41 0.49 1,229,340 Trade
NTRS Northern Trust Corporation 96.35 0.16 0.17 758,238 Trade
DRI Darden Restaurants Inc. 127.13 1.13 0.90 1,535,022 Trade
CVS CVS Health Corporation 63.26 -0.22 -0.35 4,867,271 Trade
SAP SAP SE ADS 119.68 -0.33 -0.27 372,397 Trade
EXC Exelon Corporation 47.94 0.65 1.37 3,864,494 Trade
SNE Sony Corporation 59.11 -0.83 -1.38 822,034 Trade
T AT&T Inc. 36.76 -0.40 -1.08 38,600,411 Trade
DUK Duke Energy Corporation (Holding Company) 94.26 0.39 0.42 3,067,709 Trade
BAS Basic Energy Services Inc. 1.59 -0.14 -8.09 203,364 Trade
QCOM QUALCOMM Incorporated 78.90 0.21 0.27 5,197,751 Trade
CAR Avis Budget Group Inc. 29.50 -0.01 -0.03 1,048,151 Trade
CIE Cobalt International Energy Inc. COBALT INTERNATIO n/a n/a n/a n/a
WMT Walmart Inc. 117.16 0.65 0.56 4,115,747 Trade

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