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Stock Downgrades: Delta Air Lines, Inc. Is No Longer Delivering Alpha

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

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Yesterday it definitely didn't pay to be square, neither for Pershing nor Penney (JCP). While the beleaguered retailer gave back another 3.72% after parting company with Bill Ackman, a surprisingly trendy hepcat called the shots. For it was 77-year-old Carl Icahn, suddenly sporting designer stubble, taking to Twitter that saw Apple Inc. (AAPL) advance 4.75% and helped the Dow (^DJI) erase its prior 77-point drop. Elsewhere Xerox (XRX) - which was once famously pilfered in plain sight by Steve Jobs - rose 3.35% to a fresh 52-week on an analyst upgrade.

Today's quarterly earnings announcements are expected to include Agilent Technologies (A), Cisco Systems (CSCO), Deere (DE), Dick's Sporting Goods (DKS), JinkoSolar (JKS), Macy's (M), NetApp (NTAP), NetEase (NTES), and Portugal Telecom (PT).

Aéropostale (ARO): The clothing company popular among young adults is moved to Underweight from Hold at KeyBanc Capital Markets.

Airlines: After yesterday's Justice Department-induced horror show in the sector, JPMorgan downgrades bankrupt American Airlines owner AMR Corporation (AAMRQ), Delta Air Lines, Inc. (DAL) and US Airways Group Inc (LCC). All are now Neutral from Overweight. The bank is concerned about increased risk arising from Uncle Sam's stated intention to stop the merger between AMR and LCC.

Broadridge Financial (BR): JP Morgan moves the stock to Underweight from Neutral.

China Telecom (CHA): Shares are now Neutral from Buy at UBS.

Coca-Cola Hellenic (CCH): The bottling behemoth gets downgraded to Neutral from Buy at Goldman Sachs.

Cree Inc. (CREE): The lighting company is lowered to Neutral from Buy with an amended price objective of $65 at DA Davidson due to disappointing growth and margins. Shares are falling about 15% before this morning's opening bell.

CST Brands (CST): Credit Suisse cuts the specialty retail stock to Underperform from Neutral.

Deutsche Bank (DB): The German financial giant gets downgraded to Sector Perform from Outperform at RBC Capital Markets.

EV Energy (EVEP): RBC Capital Markets cuts the company to Sector Perform from Outperform.

Millennial Media (MM): MM is moved to Hold from Buy at Canaccord Genuity.

Oil Services: Ensco (ESV) and Transocean (RIG) are each now Neutral from Buy at ISI Group, which cuts Noble Corporation (NE) to Buy from Strong Buy.

PAREXEL (PRXL): Sterne Agee slashes the medical name to Underperform from Neutral.

Pepco Holdings (POM): Shares are downgraded to Hold from Buy at Williams Capital Group, which also trims its price target by $1 to $21 amid comparatively sluggish annual base rate increases.

PetroLogistics (PDH): The stock is now Neutral from Buy at UBS.

Repsol (REPYY): Barclays reduces the Spanish energy giant to Equal Weight from Overweight.

Western Union (WU): The money-transfer titan is taken to Underweight from Neutral at JPMorgan.

(See also: Stock Upgrades: Hovnanian Enterprises, Inc Laughing All The Way to Red Bank and New Stock Coverage: Kite Realty Group Trust Can Fly High.)
No positions in stocks mentioned.
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