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Stock Downgrades: Coach Is a Train Wreck

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

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Misery really loves company for Coach, Inc. (NYSE:COH). Shares, which tumbled 9.34% on Tuesday, incur a rating reduction today. Adding insult to injury for the venerable luxury handbag maker, upstart arch rival Michael Kors (NYSE:KORS) -- upgraded this morning -- continues to bop it over the head. Although Coach reported an impressive 25% increase in sales to China, third-quarter revenue slumped by a worse-than-expected 7%.
 
After a day that was all about arms, hands, and hugs, the Dow (INDEXDJX:.DJI) is now able to reach out and touch a historic high, with blue chips standing less than 100 points shy of a fresh best. Alliant Techsystems (NYSE:ATK), the world's largest maker of ammunition, surged 6.77% to an all-time peak. General Electric (NYSE:GE) CEO Jeffrey Immelt, after meeting with French President François Hollande at the Élysée Palace in Paris, got him to shake on a deal for France's Alstom (OTCMKTS:ALSMY). (The 16th time is always the charm, I tell ya.) And a couple of billionaire activist investors kissed and made up at long last. Not all shares shared in the ebullience. Coca-Cola (NYSE:KO) cratered 1.12% to lead Dow laggards as investors emphatically voted "no" even after an equity analyst strongly said "yes." Would that wishy-washy Warren Buffett were equally willing to put principle ahead of principal.
 
This afternoon in economics, the Federal Open Market Committee finishes its 48-hour policy meeting today at 2:00 p.m. Eastern. On the earnings front, International Paper (NYSE:IP), MetLife (NYSE:MET), and Yelp Inc. (NYSE:YELP) all release results.
 
Now let's look at this morning's rash of rating reductions, an eclectic bunch that features an upscale American retailer and British tech titan, plus headline stock Coach.

AGCO Corp (NYSE:AGCO): Shares are now Neutral from Overweight at Piper Jaffray.
 
ARM Holdings (NASDAQ:ARMH): Citigroup cuts the English semiconductor stock, a key Apple Inc. (NASDAQ:AAPL) supplier, to Neutral from Buy.
 
Cloud Peak Energy (NYSE:CLD): The stock gets moved to Perform from Outperform by BMO Capital Markets.
 
Coach: Citi takes today's slumping headliner to Neutral from Buy.
 
Corning (NYSE:GLW): The glass maker gets cut to Neutral from Overweight at HSBC Securities.
 
Dresser-Rand (NYSE:DRC): Morgan Stanley downgrades DRC to Underweight from Equal Weight.
 
Nordstrom (NYSE:JWN): An excessive valuation sees the high-end retailer reduced to Hold from Buy at McAdams Wright Ragen.
 
Orbital Sciences (NYSE:ORB): KeyBanc Capital cuts the company to Hold from Buy after yesterday's 16.52% stock price surge.

Also see:

New Stock Coverage: Michael Kors Makes Its Mark

Stock Upgrades: Don't Dare Compare Apple and Orange
No positions in stocks mentioned.
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