After slumping in four of last week’s five trading sessions, U.S. stocks gave up gains from earlier in Monday’s session to slide as the S&P 500 lost 0.27%. The Dow Jones Industrial Average declined 0.12% while the Nasdaq Composite finished the day down 0.36%.
Although oil prices rose, topping $40 per barrel, gold prices also climbed, underscoring the risk-off element to today’s session. Expectations for slowing global economic growth and a dismal first-quarter earnings season could be keeping investors away from riskier assets.
With investors bracing for earnings season, there was plenty of analyst chatter to digest Monday and that helps explain why Alcoa Inc (NYSE:AA), American Airlines Group Inc (NASDAQ:AAL) and Hatteras Financial Corp. (NYSE:HTS) are three of today’s best stocks.
Alcoa Inc (AA)
Aluminum maker Alcoa climbed almost 4% on above-average volume ahead of the company’s first-quarter earnings report today after the close of U.S. markets. AA usually starts the quarterly avalanches of earnings reports, and this time around is no exception.
As InvestorPlace reported earlier Monday, analysts are expecting AA “to earn 2 cents per share on revenues of $5.14 billion for the quarter ended March 16. That would represent a 93% decline in earnings on a drop of nearly 12% in sales.”
Shares of AA, formerly a member of the Dow Jones Industrial Average, are a little more than 1% lower year-to-date.
American Airlines Group Inc (AAL)
Shares of American Airlines, one of the largest U.S. carriers, added 0.6% after the company published bullish March traffic data. Texas-based AAL said its March traffic climbed 3.3% from a year earlier, adding that total capacity rose 3.8%. International flights were the primary drivers of AAL’s traffic increase.
AAL said it expects first-quarter revenue per seat mile to decline 7% to 8%.
“Netting it all out our 1Q16 EPS estimate improves to $1.20 from $1.12 previously; full-year EPS declines to $5.35 from $5.49. American plans to report its 1Q16 results on Friday, April 22nd,” according to part of an Evercore ISI note on AAL posted by Barron’s.
Hatteras Financial Corp. (HTS)
Shares of mortgage real estate investment trust Hatteras Financial surged nearly 11% on volume that was more than 26 times the daily average after the company received a takeover offer from rival Annaly Capital Management, Inc. (NYSE:NLY).
Annaly will pay $1.5 billion for HTS. HTS shareholders can receive cash, stock or choose a combination of the two. NLY believes acquiring HTS will boost its book value and per share earnings.
At the time of this writing, Todd Shriber did not own shares of any of the aforementioned securities.
