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Upgrades & Downgrades: Google's Search Party Put On Hold


Wall Street ratings agencies set the tone for today's stock market.

On the birthday of Mr. $100 bill, Wall Street proved once again how much it worships Benjamins. Stocks, though a funk in financials meant they surrendered much of their gains going into the close, still finished solidly higher. Robust Chinese GDP helped the S&P 500 Index (^GSPC) briefly go back above 1300 for the first time since last summer, while Dow Industrials (^DJI) are off to their best 10 day start to a year since 2004. That Steve Jobs action figure has been pulled from store shelves and anyone searching for a Barbie in downtown Tehran is unfortunately outta luck but Bubble Wrap, irresistible as ever, saved the day for children of all ages when its parent Sealed Air (SEE) surged 4.62%. Kid Brands (KID), provider of infant products, continued the theme with a jump of 13.45%. Clearly money talks, even for babies, who have a newly demonstrated ability to lip read. A short squeeze sent Sears (SHLD), 47% so owned, shooting up 9.51% - little wonder 'squeezed middle' is the word of the year. There's unquestionably plenty to squeeze in the nation's midsection, fast food firm Panera Bread (PNRA) riding an analyst upgrade to gain 1.54% and end at another all-time high. It may be based in St Louis, officially America's most dangerous city, but the old Roman trick of keeping a restive populace appeased with a policy of 'bread and circuses' is working a treat, especially if those citizens own stock options.

Morgan Stanley was the investment house that raised its rating on the carb king, to a deliciously fitting 'Overweight', but these days they are far from fat cat bankers, with The Wall Street Journal saying the firm's "bonuses are sinking." Carnival Corp (CCL) is certainly sinking, down 13.65% to near a new low. Elsewhere President Obama, who obviously loves a winner, is to accept his nomination in Bank of America Stadium. And, although one should never ask a woman her age, our commander in chief demanded to see the birth certificate of an American icon as she turned 90. I wish I could tell you more about the remarkable life of Betty White but Wikipedia just went black so it ain't easy. Still, I do know she was one of the Golden Girls and entered the world in 1922, the same year King Tut's tomb was discovered and rekindled mankind's enduring love affair with the yellow metal. As such, she surely deserved a better birthday present than the 18.81% implosion in Kinross Gold (KGC), a showing that made it the NYSE's single poorest performer. Today in economics, analysts expect increases in the December 2011 industrial production and capacity utilization data, each out at 9:15 a.m. Eastern. On the earnings front ASML Holding (ASML), Bank of New York Mellon (BK), Charles Schwab Corp (SCHW), eBay Inc (EBAY), F5 Networks (FFIV), Goldman Sachs Group (GS), Northern Trust (NTRS), PNC Financial (PNC), State Street (STT), U.S. Bancorp (USB), and Xilinx (XLNX) are all due to report results.


Clothing companies: Polo Ralph Lauren (RL) is picked up with an Outperform at Credit Suisse, which has new Neutrals on underwear outfit Warnaco Group (WRC) and PVH Corp (PVH), the apparel firm formerly known as Phillips-Van Heusen.

Internet-related stocks: Raymond James rolls out Outperforms on LinkedIn (LNKD) and Pandora Media (P), the latter with a $15 target.

Online travel: JP Morgan has a new Neutral on TripAdvisor (TRIP) and assigns an Underweight on Expedia (EXPE).

Fast food: Jack In The Box (JACK) is started at an Underperform with Wedbush, which sets a $17.50 price target. The broker has a new Neutral on rival Wendy's (WEN).

Medical appliances: ThinkEquity begins Buys on both Edwards Lifesciences (EW) and Orthofix (OFIX).

Arkansas Best (ABFS): The stock is initiated with a Buy at Suntrust.

Otter Tail Power (OTTR): KeyBanc Capital has a Hold on OTTR. Near term share price upside may be limited due to uncertainty in executing a new strategy and investor concerns over the dividend.

Rose Rock Midstream (RRMS): Shares are resumed with an Outperform recommendation and $24 target price at brokerage Robert W. Baird, which says the energy outfit serves both proven and growing shale plays.

China Gerui (CHOP): Brean Murray begins Buy rated coverage and establishes a price objective of $6. Catalysts include a market-leader status, expanding capacity, nationwide customer base, and the potential for increased operating leverage.


Retailers: Noting a "Recent improvement in small business optimism", Barclays boosts Office Depot (ODP) to Equal Weight from Underweight. It gives an identical upgrade and sets an $11 objective on RadioShack (RSH), which is expected to benefit even in an environment of intense promotional activity.

MGM Resorts (MGM): The casino and resorts company is now Neutral from Underperform at Credit Suisse, sending shares up before the bell.

Nestlé: Switzerland's confectionery giant gets an Overweight-from-Neutral increase at HSBC Securities.

WPP Group plc: The British-based advertising outfit is upgraded to Outperform from Neutral by BNP Paribas.

Auxilium Pharmaceuticals (AUXL): RBC Capital raises its recommendation to Outperform from Sector Perform.

Corcept Therapeutics (CORT): Leerink Swann lifts CORT to Outperform from Market Perform.

Check Point Software (CHKP): Raymond James juices its rating to Outperform from Market Perform.

Williams-Sonoma (WSM): The Pottery Barn owner is upgraded to Strong Buy from Market Perform at Raymond James.


Google (GOOG): The Internet search giant gets moved to Market Perform from Outperform with Wells Fargo, sending shares lower ahead of the open.

Guess? (GES): Piper Jaffray trims the clothing company to Neutral from Overweight.

DIRECTV (DTV): UBS downgrades DTV to Neutral from Buy.

Rolls Royce PLC (RYCEY): Shares are trading Lower in London this morning after JP Morgan Cazenove cut it to Neutral from Overweight amid significant headwinds facing the firm.

Sanofi-Aventis (SNY): The pharmaceuticals firm is lowered to Neutral from Buy at Bank of America-Merrill Lynch.

Sirona Dental Systems (SIRO): Barlcays puts its money where its mouth is and slashes SIRO to Equal Weight from Overweight.

European telecoms: On a difficult day for the sector, BT Group PLC (BT) is showing softness in overseas trading this morning on the back of a Neutral-from-Buy downgrade at UBS, which is concerned about emerging competitive threats. The brokerage also slashes Spain's Telefonica S.A. (TEF) to Sell from Neutral.

France Telecom (FTE): FTE is taken to Sell from Hold by Deutsche Bank.

Portugal Telecom (PT): Credit Suisse cuts the stock to Underperform from Neutral.

Cash America (CSH): After an earnings miss shares are moved to Market Perform from Outperform at FBR Capital, whose objective is $50. Narrower margins for retail merchandise will take time to resolve itself.

Canadian Pacific (CP): BB&T Capital takes the stock to Hold from Buy.

Cree Inc (CREE): The LED-lighting maker is lowered to Neutral from Buy at Ticonderoga on disappointing gross margins and a delayed transition from 4-inch to 6-inch wafers.

Chesapeake Energy (CKH): Citing a weak gas price outlook, Brean Murray moves the energy outfit to Hold from Buy.

Kroger (KR): The grocer gets cut to Market Perform from Outperform at BMO Capital.

Tyson Foods (TSN): BMO Capital takes the poultry producer to Market Perform from Outperform.

Janus Capital (JNS): The financial firm is now Sell from Neutral at Citigroup.

Plantronics (PLT): Mizuho moves the name to Neutral from Buy at Mizuho with a $37 target, citing heightened concerns on the upcoming quarter and earnings guidance.

Health Care REIT (HCN): The real estate stock is reduced to Neutral from Buy by Bank of America-Merrill Lynch.

Skechers USA (SKX): The footwear firm gets lowered to Hold from Buy at BB&T Capital.

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