Stocks Surge On EU Deal, Strong Economic Numbers

Sector Recap |

Stock Market Trading FloorInitial Jobless Claims came in at 402,000 well below the 350,000 recessionary threshold. On Friday, Personal Income should rise by 0.2% with Spending up 0.7% in September. The Dow Jones Industrial Average gapped above its 200-day simple moving average at 11,970 at the open trading to a final hour high above 12,280. The NASDAQ gapped above its 200-day simple moving average at 2691 at the open to a final hour high above 2750.

Asian stocks surged as European leaders clinched a debt crisis deal. The Nikkei 225 rallied 2.04% to 8,927 with the Hang Seng gaining 3.26% to 19,689. European stocks surged on debt relief with the FTSE 100 gaining 2.89% to 5,714 with the DAX surging 5.35% to 6,338 and the CAC 40 powering higher by 6.28% to 3,369. The US Treasury 10-Year yield rose from 2.182 percent to 2.407 on Thursday. Gold traded up from $1707.2 the Troy ounce to $1751.3 above its 50-day simple moving average at $1736.8. Crude oil traded up from $90.74 per barrel to $94.25 staying below its 200-day simple moving average at $94.77. The euro versus the dollar is trading between its 50-day and 200-day simple moving averages at 1.3847 and 1.4097 then popped to 1.4245. Advanced third quarter GDP came in at 2.5% in line with expectations.

Energy

Cameron International (CAM) beat estimates by 4 cents, while missing revenue by $100M. ExxonMobil (XOM) reported Q3 EPS of $2.13 (in-line). Occidental Petroleum (OXY) beat estimates by 21 cents and revenue by $300M. Triangle Petroleum (TPLM) is started with a Hold at KeyBanc Capital. Voyager Oil & Gas (VOG) is begun with a Buy and $4 price objective at brokers C.K. Cooper. In afternoon trading: Shares of McDermott International (MDR) are down about 24%. Shares of LDK Solar (LDK) are up about 25.5%. Shares of Suntech Power (STP) are up about 20.75%.

Energy Select Sector SPDR (XLE) was trading at $72.55 at 4:00 PM on Thursday, up 4.43% on the day – up 6.30% year-to-date.

Materials

International Paper (IP) beat estimates by 12 cents, while missing revenue by $160M. Barrick Gold (ABX) beat estimates by 4 cents and revenue by $130M. Agrium (AGU) is resumed with an Outperform at RBC Capital, which starts Sector Performs on rivals Mosaic (MOS) and Potash (POT). MeadWestvaco (MWV) is moved180 degrees to Underweight from Outperform at BMO Capital. CRH Plc. (CRH) is cut to Neutral from Outperform at Credit Suisse. In afternoon trading: Shares of Century Aluminum (CENX) are up about 18.5%. Shares of Cemex (CX) are up about 18.75%. Shares of ArcelorMittal (MT) are up about 16.25%.

The Materials Select Sector SPDR (XLB) was trading at $35.74 at 4:00 PM on Thursday, up 5.43% on the day – down 6.95% year-to-date.

Industrials

Goodrich (GR) beat estimates by 20 cents and revenue by $40M. United Continental (UAL) missed estimates by 7 cents with revenue in-line with estimates. GrafTech International Ltd (GTI) beat estimates by 4 cents and revenue by $16M. Raytheon (RTN) beat estimates by 6 cents, while missing revenue by $250M. Owens Corning (OC) is upgraded to Buy from Hold with a $36 price target at Stifel Nicolaus. Lockheed Martin (LMT) is lowered to Neutral from Buy at Suntrust. In afternoon trading: Shares of Terex (TEX) are up about 20.25%. Shares of Polypore International (PPO) are up about 14%. Shares of The Manitowoc Company (MTW) are up about 13.75%.

The Industrial Select Sector SPDR (XLI) was trading at $34.26 at 4:00 PM on Thursday, up 4.36% on the day – down 1.75% year-to-date.

Consumer Discretionary

As expected, Sony (SNE) is to buy Ericsson's (ERIC) 50% share of Sony Ericsson for €1.05B ($1.47B) in a deal that also provides Sony with a broad IP cross-licensing agreement and ownership of five essential patent families. Toyota (TM) and other Japanese car makers have started to reduce domestic production because of a shortage of parts due to the worst flooding in Thailand in five decades, which has wiped out hundreds of factories. Dell (DELL) and Western Digital (WDC) are also affected. IMAX (IMAX) missed estimates by 4 cents, while beating revenue by $400,000. Dana Holding (DAN) beat estimates by 3 cents and revenue by $90M. Johnson Controls (JCI) missed estimates by a penny, while beating revenue by $220M. Brinker International (EAT) is now Underperform from Neutral at Sterne Agee with a $20 target price. Sterne also cuts Panera Bread (PNRA) to Neutral from Buy. AnnTaylor (ANN) is pulled from Citigroup’s list of Top Picks Live. In afternoon trading: Shares of Bally Technologies (BYI) are up about 13%. Shares of DiamondRock Hospitality (DRH) are up about 13%.

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $39.94 at 4:00 PM on Thursday, up 2.73% on the day – up 6.76% year-to-date.

Consumer Staples

Mead Johnson Nutrition (MJN) beat estimates by a penny with revenue in-line with estimates. Coca-Cola Enterprises (CCE) beat estimates by 2 cents with revenue in-line with estimates. Hershey Foods (HSY) beat estimates by 2 cents with revenue in-line with estimates. Colgate-Palmolive Company (CL) beat estimates by a penny with revenue in-line with estimates. Avon (AVP) missed estimates by 8 cents and revenue by $120M. Altria (MO) reported Q3 EPS of $0.56 (in-line), while beating revenue by $1.7B. Dr. Pepper Snapple (DPS) is cut to Underweight from Equal Weight at Morgan Stanley. In afternoon trading: Shares of Avon are down about 17.25%. Shares of American Oriental Bioengineering (AOB) are up about 30.75%. Shares of Coffee Holding Company (JVA) are up about 12.5%. Shares of Rite Aid (RAD) are up about 10.25%.

The Consumer Staples Select Sector SPDR (XLP) was trading at $31.59 at 4:00 PM on Thursday, up 1.28% on the day – up 7.78% year-to-date.

Healthcare

Incyte (INCY) beat estimates by 3 cents and revenue by $300,000. Endo Pharmaceuticals (ENDP) beat estimates by 6 cents and revenue by $9M. Celgene (CELG) beat estimates by 7 cents and revenue by $50M. Bristol-Myers (BMY) beat estimates by 3 cents with revenue in-line with estimates. Zimmer (ZMH) beat estimates by a penny with revenue in-line with estimates. Cardinal Health (CAH) beat estimates by a penny and revenue by $600M. Hospira (HSP) is boosted to Buy from Neutral at Bank of America-Merrill Lynch. Thermo Fisher (TMO) is taken to Neutral from Overweight at JPMorgan. Healthspring (HS) is cut to Hold from Buy at Jefferies, as their shares are no longer trading on fundamentals following an acquisition offer from Cigna (CI). Coventry Health Care (CVH) gets cut to Market Perform from Outperform by Sanford Bernstein. In afternoon trading: Shares of Community Health Systems (CYH) are down about 14.25%. Shares of Dendreon (DNDN) are up about 12%. Shares of DENTSPLY International (XRAY) are up about 11%. Shares of Geron (GERN) are up about 11%.

The Health Care Select Sector SPDR (XLV) was trading at $34.18 at 4:00 PM on Thursday, up 2.43% on the day – up 8.51% year-to-date.

Financials

As it has done in every quarter since going public in March 2008, Visa's (V) FQ4 EPS exceeded analyst forecasts, rising 14% to $1.27 (versus a consensus of $1.25). However, revenues missed expectations despite growing 12.6% to $2.39B. North Carolina is probing Encore Capital (ECPG), the U.S.'s largest buyer of consumer debts, for the way it collects those debts. Lazard (LAZ) missed estimates by 3 cents, while beating revenue by $22M. Mack-Cali Realty (CLI) beat estimates by 5 cents, while missing revenue by $2M. Moody's (MCO) beat estimates by 8 cents, while beating revenue by $10M. Digital Realty Trust (DLR) beat estimates by 2 cents and revenue by $6M. Legg Mason (LM) beat estimates by 24 cents, while missing revenue by $4M. Prudential Plc (PUK) is picked up with a Hold at Jefferies. Bank of America (BAC) is downgraded to Equal weight from Overweight at Morgan Stanley. Visa (V) is cut to Market Perform from Outperform at FBR Capital after earnings. United Bankshares (UBSI) is lowered to Hold from Buy at Stifel Nicolaus. In afternoon trading: Shares of MF Global (MF) are down about 12.5% following a credit-rating downgrade by Fitch. Shares of Deutsche Bank (DB) are up about 18.5%. Shares of ING Group (ING) are up about 17.5%. Shares of Axa SA (AXAHY) are up about 17.5%. Shares of Lazard (LAZ) are up about 17.5%. Shares of Jeffries Group (JEF) are up about 17.25%. Shares of Barclays Bank (BCS) are up about 16.5%. Shares of Morgan Stanley (MS) are up about 16%.

The Financial Select Sector SPDR (XLF) was trading at $14.04 at 4:00 PM on Thursday, up 5.96% on the day – down 11.97% year-to-date.

Information Technology

As expected, Sony (SNE) is to buy Ericsson's (ERIC) 50% share of Sony Ericsson for €1.05B ($1.47B) in a deal that also provides Sony with a broad IP cross-licensing agreement and ownership of five essential patent families. Toyota (TM) and other Japanese car makers have started to reduce domestic production because of a shortage of parts due to the worst flooding in Thailand in five decades, which has wiped out hundreds of factories. Dell (DELL) and Western Digital (WDC) are also affected. As it has done in every quarter since going public in March 2008, Visa's (V) FQ4 EPS exceeded analyst forecasts, rising 14% to $1.27 (versus a consensus of $1.25). However, revenues missed expectations despite growing 12.6% to $2.39B. Akamai (AKAM) said yesterday that its President, David Kenny, is leaving the company to "pursue more opportunities in the consumer Internet space." This could increase speculation that he might be headed for the top job at Yahoo - where he is already a director. Solarwinds (SWI) beat estimates by 8 cents and revenue by $2M. Monster Worldwide (MWW) beat estimates by a penny, while missing revenue by $6M, and sees Q4 bookings flat, revenue up 3%-7% Y/Y to push EPS to a range of $0.11-$0.15. Yandex N.V. (YNDX) beat estimates by 3 cents, while missing revenue by $2M. Citrix Systems (CTXS) beat estimates by 6 cents and revenue by $19M, and expects Q4 revenue of $610M-$620M and EPS of $0.75-$0.76 (above consensus of $609.3M and $0.74) and 2012 revenue of $2.47-$2.48 (above consensus of $2.46B). Movie Star (MSI) beat estimates by 5 cents with revenue in-line with estimates. Movie Star (MSI) beat estimates by 5 cents with revenue in-line with estimates. Itron (ITRI) is begun as a Buy and $46 price objective at Jefferies. Cisco Systems (CSCO) gets a Buy-from-Neutral boost at UBS. Acme Packet (APKT) is added to Deutsche Bank’s Buy List. Visa (V) is cut to Market Perform from Outperform at FBR Capital after earnings. Aeroflex (ARX) is now Neutral from Overweight, also at JPMorgan. In afternoon trading: Shares of TriQuint Semiconductor (TQNT) are down about 25%. Shares of AXT (AXTI) are down about 20.5%. Shares of BMC Software (BMC) are down about 11.75%. Shares of Plexus (PLXS) are down about 10.5%. Shares of Vanceinfo (VIT) are up about 1.5%. Shares of Acme Packet are up about 20.5%.

The Technology Select Sector SPDR (XLK) was trading at $26.39 at 4:00 PM on Thursday, up 2.97% on the day – up 4.76% year-to-date.

Telecommunications Services

NII (NIHD) missed estimates by 61 cents with revenue in-line with estimates. In afternoon trading: Shares of NII Holdings are down about 14.5%. Shares of Leap Wireless (LEAP) are up about 7.75%. Shares of Cincinnati Bell (CBB) are up about 7.5%. Shares of Level 3 Communications (LVLT) are up about 7%. Shares of Telefonica (TEF) are up about 6.75%. Shares of France Telecom (FTE) are up about 5.5%. Shares of Sprint (S) are up about 5%, while shares of AT&T (T) are up about 2.75% and shares of Verizon (VZ) are up about 2.5%.

The NASDAQ Telecommunications Index (IXTC) was trading at $202.69 at 4:00 PM on Thursday, up 3.56% on the day – down 10.06% year-to-date.

Utilities

CMS Energy (CMS) beat estimates by 3 cents and revenue by $300M. Xcel Energy (XEL) beat estimates by 4 cents with revenue in-line with estimates. CenterPoint Energy (CNP) are moved to Neutral from Outperform at Macquarie. In afternoon trading: Shares of Calpine (CPN) are up about 7.25%. Shares of Dynegy (DYN) are up about 6%. Shares of AES Corp. (AES) are up about 5.5%. Shares of NRG Energy (NRG) are up about 5.25%.

The Utilities Select Sector SPDR (XLU) was trading at $35.30 at 4:00 PM on Thursday, up 2.38% on the day – up 12.64% year-to-date.

STOCKS: CAM, XOM, OXY, TPLM, VOG, MDR, LDK, STP, IP, ABX, AGU, MOS, POT, MWV, CRH, CENX, CX, MT, GR, UAL, GTI, RTN, OC, LMT, TEX, PPO, MTW, SNE, ERIC, TM, DELL, WDC, IMAX, DAN, JCI, EAT, PNRA, ANN, BYI, DRH, MJN, CCE, HSY, CL, AVP, MO, DPS, AOB, JVA, RAD, INCY, ENDP, CELG, BMY, ZMH, CAH, HSP, TMO, HS, CI, CVN, CYH, DNDN, XRAY, GERN, V, ECPG, LAZ, CLI, MCO, DLR, LM, PUK, BAC, UBSI, MF, DB, ING, AXAHY, LAZ, JEF, BCS, MS, TM, AKAM, SWI, MWW, YNDX, CTXS, MSI, MSI, ITRI, CSCO, APKT, ARX, TQNT, AXTI, BMC, PLXS, VIT, NIHD, LEAP, CBB, LVLT, TEF, FTE, S, T, VZ, CMS, XEL, CNP, CPN, DYN, AES, NRG

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
ABX Barrick Gold Corporation 17.92 -0.19 -1.05 10,341,625
AES The AES Corporation 13.12 -0.14 -1.06 2,636,128
AGU Agrium Inc. 90.34 -1.32 -1.44 915,942
AKAM Akamai Technologies Inc. 51.76 -0.49 -0.94 1,298,509
AVP Avon Products Inc. 5.61 -0.23 -3.94 2,645,001
AXTI AXT Inc 4.86 -0.01 -0.21 116,933
BAC Bank of America Corporation 15.09 -0.43 -2.77 94,345,112
BCS Barclays PLC 8.68 -0.15 -1.70 5,614,502
BMY Bristol-Myers Squibb Company 55.48 -1.00 -1.77 8,596,724
CAH Cardinal Health Inc. 76.88 -0.78 -1.00 1,700,611
CAM Cameron International Corp n/a n/a n/a 0
CBB Cincinnati Bell Inc. 4.00 -0.07 -1.72 620,510
CCE Coca-Cola European Partners plc 39.52 -0.71 -1.76 3,069,344
CELG Celgene Corporation 106.31 -3.12 -2.85 4,075,627
CENX Century Aluminum Company 6.63 0.04 0.61 1,191,363
CI Cigna Corporation 130.34 -0.66 -0.50 718,295
CL Colgate-Palmolive Company 73.11 -0.14 -0.19 2,502,847
CLI Mack-Cali Realty Corporation 28.28 0.48 1.73 633,625
CMS CMS Energy Corporation 44.02 0.15 0.34 2,001,990
CNP CenterPoint Energy Inc (Holding Co) 24.26 0.07 0.29 1,912,201
CPN Calpine Corporation 13.67 -0.23 -1.65 3,235,383
CRH CRH PLC American Depositary Shares 33.11 -0.43 -1.28 870,372
CSCO Cisco Systems Inc. 31.07 -0.27 -0.86 20,198,932
CTXS Citrix Systems Inc. 84.56 -0.35 -0.41 656,177
CX Cemex S.A.B. de C.V. Sponsored ADR 7.55 -0.18 -2.33 10,192,765
CYH Community Health Systems Inc. 10.31 -0.04 -0.39 5,491,587
DAN Dana Holding Corporation When-Issued 15.09 -0.25 -1.63 1,150,698
DB Deutsche Bank AG 11.85 -0.90 -7.06 20,637,707
DLR Digital Realty Trust Inc. 97.64 -0.31 -0.32 2,170,629
DPS Dr Pepper Snapple Group Inc 90.29 -1.32 -1.44 1,179,094
DRH Diamondrock Hospitality Company 9.01 -0.38 -4.05 3,285,785
ECPG Encore Capital Group Inc 21.45 0.04 0.19 249,489
ENDP Endo International plc 21.99 -1.40 -5.99 8,551,911
ERIC Ericsson 6.90 -0.03 -0.43 2,552,843
GERN Geron Corporation 2.21 0.01 0.45 1,499,805
HSY The Hershey Company 95.33 -0.52 -0.54 859,269
INCY Incyte Corporation 88.76 -0.22 -0.25 1,083,295
ING ING Group N.V. 12.14 -0.19 -1.54 2,625,614
IP International Paper Company 47.36 -1.05 -2.17 3,238,317
ITRI Itron Inc. 54.86 -0.31 -0.56 287,309
JCI Johnson Controls Inc. 44.29 -0.10 -0.23 4,386,721
JVA Coffee Holding Co. Inc. 5.49 -0.09 -1.63 30,164
LAZ Lazard LTD. LTD. Class A 35.98 -0.66 -1.80 683,168
LM Legg Mason Inc. 33.02 -0.90 -2.65 1,036,429
LMT Lockheed Martin Corporation 245.53 -0.31 -0.13 880,701
LVLT Level 3 Communications Inc. 47.03 -0.52 -1.09 2,285,674
MCO Moody\'s Corporation 108.99 -0.28 -0.26 877,120
MDR McDermott International Inc. 4.56 -0.03 -0.65 2,720,443
MJN Mead Johnson Nutrition Company 76.90 -1.45 -1.85 982,090
MO Altria Group Inc. 63.03 -0.84 -1.32 4,793,927
MODN Model N Inc. 10.63 -0.14 -1.30 61,993
MOS Mosaic Company (The) 24.14 -0.68 -2.74 6,536,965
MS Morgan Stanley 31.03 -0.88 -2.76 10,184,087
MT ArcelorMittal 6.06 0.00 0.00 15,784,478
MTW Manitowoc Company Inc. (The) 4.35 -0.05 -1.14 616,064
MWW Monster Worldwide Inc. 3.52 -0.03 -0.85 521,823
NIHD NII Holdings Inc. 3.21 -0.11 -3.31 371,254
NRG NRG Energy Inc. 11.30 -0.23 -1.99 4,892,910
OC Owens Corning Inc New 53.48 0.15 0.28 1,281,185
OXY Occidental Petroleum Corporation 69.32 -0.28 -0.40 4,687,338
PLXS Plexus Corp. 46.20 -0.98 -2.08 130,889
PNRA Panera Bread Company 195.39 -3.63 -1.82 536,742
POT Potash Corporation of Saskatchewan Inc. 15.91 -0.04 -0.25 6,933,016
PUK Prudential Public Limited Company 35.69 -0.74 -2.03 701,390
RAD Rite Aid Corporation 8.04 -0.05 -0.62 11,536,512
RTN Raytheon Company 138.54 -0.04 -0.03 1,052,512
S Sprint Corporation 6.65 0.01 0.15 13,882,201
SNE Sony Corporation 33.46 -0.14 -0.42 614,146
SWI SolarWinds n/a n/a n/a 0
T AT&T Inc. 41.14 -0.14 -0.34 16,405,453
TEF Telefonica SA 10.42 -0.20 -1.88 1,022,253
TEX Terex Corporation 23.24 0.20 0.87 1,097,068
TM Toyota Motor Corporation 117.10 -0.56 -0.48 317,199
TMO Thermo Fisher Scientific Inc 156.16 -1.50 -0.95 1,625,799
TPLM Triangle Petroleum Corporation (DE) 0.27 -0.01 -3.59 1,174,935
UAL United Continental Holdings 49.45 -1.50 -2.94 4,693,626
UBSI United Bankshares Inc. 36.76 -0.96 -2.55 414,056
V Visa Inc. 81.81 -0.73 -0.88 8,486,752
VOG Voyager Oil & Gas Inc n/a n/a n/a 0
VZ Verizon Communications Inc. 52.15 -0.41 -0.78 10,558,017
WDC Western Digital Corporation 57.01 1.08 1.93 5,897,948
XEL Xcel Energy Inc. 43.10 0.03 0.07 4,269,519
XOM Exxon Mobil Corporation 83.06 -0.39 -0.47 10,813,030
XRAY DENTSPLY SIRONA Inc. 58.83 -0.53 -0.89 1,624,543
YNDX Yandex N.V. 21.36 -0.21 -0.97 1,277,237

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