Trader Talk

Pisani: The Q1 Market Losers (Updated)


Update: Predictably, there has been some modest profit taking going into the close. Market on close imbalances are slightly higher than usual, with a slight bias toward stock for sale toward the close.

First quarter 2010: this time, a look at the losers.

I noted earlier that although the S&P is up 5 percent this quarter (4th consecutive quarter of growth), there has been very wide discrepancies between the winners and losers this quarter. While there have been double digit gains in industrials, retail, and banks, many groups saw little gains, and some fell back. Here's some of the more notable laggards, and why:

Telecom down 5.2 percent (pure wireless plays like Clearwire outperform large carriers like AT&T, Verizon)

Utilities down 4.2 percent (higher interest rates, nat gas declines)

Gold stocks down 4 percent dollar strength stalled gold momentum

Energy up 0.3 percent (nat gas declines)

Tech up 2.1 percent (seasonally weak period; tech had been a huge outperformer in '09 and had become "overowned" heading into 2010)

One notable laggard: independent power producers have had a simply disastrous quarter-look at AES, Mirant, and Dynegy, down 17 percent, 28 percent, and 30 percent, respectively.

Ouch! What happened?

Natural gas happened. Independent power producers usually work in regulated markets, where the price they can charge is often tied to natural gas prices. Nat gas went from $6 to $4…a disastrous impact on profits, since fixed costs did not change.

CNBC Data Pages:



Questions?  Comments?