CPI rose 0.4% in February as gasoline prices rose 6.0% the highest amount since December 2010. CPI was up 2.9% year over year. Excluding food & energy CPI rose just 0.1%. Industrial Production was unchanged in February below expectations. The University of Michigan Consumer Sentiment Index falls to 74.3 in March from 75.3 in February. The Dow Industrial Average traded to a new year to date high at 13,289.08 then dipped to 13,239.06. The NASDAQ’s traded down from 3059.65 to 3047.69 then rebounded to a new year to date high at 3060.82.
Asian stocks were mixed on Friday. The Nikkei 225 ended their session at 10,130 – up 0.06% on the day. The Hang Seng ended their session at 21,318 – down 0.17% on the day. European stocks were higher on Friday. The FTSE 100 ended their session at 5,966 – up 0.42% on the day. The DAX ended their session at 7,158 – up 0.19% on the day. The CAC 40 ended their session at 3,595 – up 0.41% on the day. The yield on the 10-Year US Treasury rose from 2.272 percent to 2.363 then consolidated well above its 200-day simple moving average at 2.220.
Gold traded down from $1664.9 the Troy ounce to $1639.7 then consolidated below its 50-day and 200-day simple moving averages at $1703.4 and $1679.2. Crude oil rebounded from $105.13 per barrel to $107.24. The euro versus the dollar rebounded from 1.3051 to 1.3185 above its 50- day simple moving average at 1.3106.
Energy
Exxon Mobil (XOM) is in negotiations to sell its 60% stake in Hong Kong’s Castle Peak Power to CLP Holdings (CLPHY) – which already owns the other 40% – and China Southern Power Grid. Chevron (CVX) has filed a request to suspend production at the 61,500 bpd Frade field off the coast of Brazil after a “small new seep” of oil was detected in the area. Tsakos Energy Navigation (TNP) beat estimates by 5 cents with revenue in-line with estimates. Golar LNG (GLNG) gets picked up at a Market Perform with Wells Fargo. Vantage Drilling (VTG) is increased to Buy from Hold at Dahlman Rose. Transocean (RIG) is raised to Buy from Neutral with an increased price target of $70 at Global Hunter Securities. Seadrill Ltd (SDRL) is taken to Hold from Buy at Dahlman Rose.
Energy Select Sector SPDR (XLE) was trading at $74.80 at 4:00 PM on Thursday, up 0.99% on the day – up 8.20% year-to-date. The February 2012 change was +5.93%. The 2011 change was -1.29%.
Materials
The Materials Select Sector SPDR (XLB) was trading at $37.10 at 4:00 PM on Thursday, down 0.19% on the day – up 10.75% year-to-date. The February 2012 change was -0.56%. The 2011 change was -12.78%.
Industrials
UPS (UPS) has reiterated its plan to make an offer for TNT Express and intends to file for the approval of its bid documents to Dutch market regulator AFM by May 11, UPS said in an obligatory update. Excel Maritime Carriers (EXM) beat estimates by a penny and revenue by $8M. Wabtec (WAB) is hoisted to Buy from Hold at BB&T Capital. Armstrong World Industries (AWI) is cut to Hold from Buy at KeyBanc Capital.
The Industrial Select Sector SPDR (XLI) was trading at $37.98 at 4:00 PM on Thursday, down 0.42% on the day – up 12.53% year-to-date. The February 2012 change was +2.79%. The 2011 change was -3.21%.
Consumer Discretionary
The new iPad (with its primitive 5 megapixel camera) went on sale today in stores across ten countries just hours after Apple (AAPL) shares touched $600 for the first time. Australia was the first country in which the iPad was sold, with Wal-Mart (WMT), Best Buy (BBY) and RadioShack (RSH), as well as Apple, selling it in the U.S. New York & Company (NWY) reported Q4 EPS of -$0.18 (in-line), while beating revenue by $4M. Coach Inc (COH) is begun with a Buy recommendation and $90 price objective at Argus. Cabela’s (CAB) is an Outperform at Wells Fargo. Dana Holding (DAN) is a new Buy at Bank of America-Merrill Lynch. Dick’s Sporting Goods (DKS) is a fresh Market Perform with Wells. Lear Corp (LEA) is added to the Conviction Buy List at Goldman Sachs. Porsche (POAHY) and Mercedes-Benz owner Daimler AG (DDAIF) are each cut to Underperform from Market Perform by Sanford Bernstein, which reduces Peugeot Citroën (PEUGY) to Market Perform from Outperform, sending all three lower in London. Buffalo Wild Wings (BWLD) is now Neutral from Outperform with Wedbush.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $44.35 at 4:00 PM on Thursday, down 0.63% on the day – up 13.66% year-to-date. The February 2012 change was +10.09%. The 2011 change was +4.30%.
Consumer Staples
Dole Food (DOLE) beat estimates by 8 cents, while missing revenue by $30M. Primo Water (PRMW) missed estimates by 2 cents with revenue in-line with estimates. Estée Lauder (EL) is cut to Above Average from Buy at Caris & Company. Primo Water (PRMW) is moved to Neutral from Buy at Janney Montgomery Scott.
The Consumer Staples Select Sector SPDR (XLP) was trading at $33.60 at 4:00 PM on Thursday, down 0.59% on the day – up 3.42% year-to-date. The February 2012 change was +3.75%. The 2011 change was +10.85%.
Health Care
Neurocrine Biosciences (NBIX) is a new Buy at Deutsche Bank. Par Pharmaceutical (PRX) is a new Neutral at JP Morgan. Shire plc (SHPGY) is moved to Overweight from Neutral at JPMorgan. Triple-S Management (GTS) gets taken to Market Perform from Outperform with Wells.
The Health Care Select Sector SPDR (XLV) was trading at $36.85 at 4:00 PM on Thursday, down 0.51% on the day – up 6.23% year-to-date. The February 2012 change was +1.06%. The 2011 change was +10.32%.
Financials
A federal appeals court yesterday chastised Judge Jed Rakoff for his rejection of the SEC’s $285M settlement with Citigroup (C) over toxic mortgage debt, and said the agency and the bank are likely to win their attempt to get Rakoff’s decision overturned. UBS (UBS) has joined three other strategic investors in investing $1.6B to buy a 16.5% stake in China Cinda Asset Management in advance of a future public offering of shares. Rolling Stone’s Matt Taibbi continues to go after the financial community in a big way, setting his sights this time on “too crooked to fail” Bank of America (BAC). American Tower (AMT) and SBA Communications (SBAC) are each initiated with Outperforms at Credit Suisse, which has a new Neutral on Crown Castle International (CCI). Federal Realty Investment Trust (FRT) is assigned an In-Line and $99 target price at Imperial Capital. Royal Bank of Scotland (RBS) is boosted to Buy from Neutral at UBS. Morgan Stanley (MS), TD Ameritrade (AMTD), and BlackRock (BLK) are all downgraded to Hold from Buy at Deutsche Bank. Sun Communities (SUI) gets lowered to Underperform from Neutral by Bank of America-Merrill Lynch.
The Select Sector SPDR (XLF) was trading at $15.72 at 4:00 PM on Thursday, up slightly on the day – up 20.92% year-to-date (the strongest performing sector). The February 2012 change was +5.02%. The 2011 change was -18.50%; the weakest performing sector for the year.
Information Technology
The FTC and state attorneys-general have joined France in investigating Google (GOOG) for bybassing the privacy settings on Apple’s (AAPL) Safari Web browser to install cookies, The Wall Street Journal reports. The new iPad (with its primitive 5 megapixel camera) went on sale today in stores across ten countries just hours after Apple (AAPL) shares touched $600 for the first time. Australia was the first country in which the iPad was sold, with Wal-Mart (WMT), Best Buy (BBY) and RadioShack (RSH), as well as Apple, selling it in the U.S. Comverge (COMV) beat estimates by 17 cents, while missing revenue by $3M. Perfect World (PWRD) beat estimates by 43 cents on revenue of $123M. Cogo Group (COGO) beat estimates by a penny and revenue by $22M. ManTech (MANT) is a new Underweight at Morgan Stanley. Microsoft (MSFT) is upgraded to Buy from Hold with a $39 target at Argus. Acme Packet (APKT) is now Outperform from Market Perform at Northland Securities. AXT Inc (AXTI) is upgraded to Outperform from Market Perform at Northland Securities, which takes its objective up to $8. Red Hat (RHT) is reduced to Equal Weight from Overweight at Morgan Stanley. ADTRAN (ADTN) is cut to Hold from Buy at ThinkEquity.
The Technology Select Sector SPDR (XLK) was trading at $29.88 at 4:00 PM on Thursday, down 0.37 on the day – up 17.41% year-to-date. The February 2012 change was +7.08%. The 2011 change was +1.03%.
Telecommunication Services
American Tower (AMT) and SBA Communications (SBAC) are each initiated with Outperforms at Credit Suisse, which has a new Neutral on Crown Castle International (CCI).
The NASDAQ Telecommunications Index (IXTC) was trading at $213.91 at 4:00 PM on Thursday, up 0.50% on the day – up 8.62% year-to-date. The February 2012 change was +1.63%. The 2011 change was -12.62%.
Utilities
Exxon Mobil (XOM) is in negotiations to sell its 60% stake in Hong Kong’s Castle Peak Power to CLP Holdings (CLPHY) – which already owns the other 40% – and China Southern Power Grid. Veolia Environnement (VE) is raised to Neutral from Sell at UBS.
The Utilities Select Sector SPDR (XLU) was trading at $34.78 at 4:00 PM on Thursday, down 1% on the day – down 3.34% year-to-date (the weakest performing sector). The February 2012 change was +0.61%. The 2011 change was +14.81%; the strongest performing sector for the year.
Stocks: XOM, CLPHY, CVX, TNP, GLNG, VTG, RIG, SDRL, XLE, XLB, UPS, EXM, WAB, AWI, XLI, AAPL, WMT, BBY, RSH, NWY, COH, CAB, DAN, DKS, LEA, POAHY, DDAIF, PEUGY, BWLD, XLY, DOLE, PRMW, EL, XLP, NBIX, PRX, SHPGY, GTS, XLV, C, UBS, BAC, AMT, SBAC, CCI, FRT, RBS, MS, AMTD, BLK, SUI, XLF, GOOG, AAPL, WMT, BBY, RSH, COMV, PWRD, COGO, MANT, MSFT, APKT, AXTI, RHT, ADTN, XLK, AMT, SBAC, CCI, IXTC, XOM, CLPHY, VE, XLU
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