SPY Dipped on Yellen’s Comments, EWU Rose on Draghi’s Reassurance
(Continued from Prior Part)
Sector performances
On November 4, 2015, the energy sector led the decliners due to drop in oil prices. The Energy Select Sector SPDR ETF (XLE) dropped by 0.9% on the day. Lower commodities and gold prices took the material and mining sector into negative territory, closely followed by the consumer discretionary sector. The financial services sector gained on the day as increased borrowing costs increase lenders’ margins.
The following graph illustrates the performances of the component sectors of the SPDR S&P 500 ETF (SPY) in percentages as of November 4, 2015.
Range Resources tops key stocks
Stocks at the top of the SPDR S&P 500 ETF (SPY) on November 4 were Range Resources (RRC), Michael Kors Holdings (KORS), and NRG Energy (NRG). These stocks gained 9.9%, 8.3%, and 4.5%, respectively, on the day.
Range Resources (RRC) was rated a “buy” by the research analysts at Citigroup (C). The company’s quarterly earnings data reported last week was solid, beating analysts’ expectations. The stock’s trading volume rose to 9,134,640 stocks on November 4 from the previous day’s trading volume of 4,560,497 stocks.
RRC traded at $34.08 above its 20-day moving average while the stock’s target price was raised to $56.00 by Credit Suisse (CS) analysts. The Relative Strength Index (or RSI) of the stock is 54. The trailing five-day return of RRC was 18.21%, earning 29 “buy” recommendations, 12 “hold” recommendations, and no “sell” recommendations. RRC is rated as BB+ by Standard & Poor’s, with a “stable” outlook.
Nora Field assets
On November 4, Range Resources (RRC) also announced its agreement to sell its Nora Field assets, located in Virginia, for $876 million. These assets accounted for 7.5% of the company’s net production for 3Q15. The company plans to use the proceeds from the sale to reduce its total debt by 24%. The sale is also expected to reduce expenses like direct operating expenses, natural gas brokerages, as well as general, selling, marketing, and administrative overhead for 2016.
Stocks at the bottom of the SPY on November 4 were Avon Products (AVP), Motorola Solutions (MSI), and Mosaic (MOS). These stocks yielded -19.9%, -8.6%, and -8.6%, respectively. Avon Products (AVP) dropped on the day after the company reported a loss of $0.11 per share for the third quarter. The quarterly sales of the beauty products company declined by 23%, and Avon has lowered its outlook for 2015.
In the final part of this series, we’ll take a look at the UK stock market.
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