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Upgrades & Downgrades: Travelers Is Going Places

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

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Mother Nature helped the market yesterday, though the final word may yet belong to Father Time. Balmy March temperatures boosted retail sales and sent blue chips up but the age-old seasonal headwind known as "sell in May and go away" will soon start to loom large. In a bifurcated trading session, the Dow (DJI) advanced impressively even as the Nasdaq (IXIC) endured something of a tech wreck. Aiding the former was JPMorgan (JPM), which finished in the green Monday after falling 3.64% on Friday following earnings that were immediately characterized as both bad and good. (Mr. Morgan himself, who turned 75 on this day in 1912, knew better than most that initial headlines are often misleading. The newspaper he read a century ago this evening breezily assured the tycoon, scheduled to sail on a certain ship until a last minute schedule change, that "All Titanic Passengers Are Safe.") Apple (AAPL) meanwhile sank for a fifth straight session since hitting $600 billion in market cap only last week. That threshold proved Kryptonite for Microsoft (MSFT), which was dead money for a decade after standing atop a similar summit in late 1999. Is history about to eerily repeat for today's tech titan, right down to its own Justice Department lawsuit?

Stuffing money under the sofa, while not as sexy, may prove more profitable going forward, with Mattress Firm Holding (MFRM) advancing a further 1.82% to a post-IPO peak -- even if more of us opt to freeze, rather than sleep on, our assets. In analyst action, an upgrade of Vornado Realty Trust (VNO) sent it 2.76% higher to pace all S&P 500 (GSPC) gainers. This company owns Two Penn Plaza, which is a stone's throw from Madison Square Garden (MSG), and owners of the latter may wish to take out their frustration by testing the distance literally after a ratings reduction sent it skidding 1.54%. Elsewhere Brent crude oil fell to $118.20 per barrel, an almost two-month low, after Iranian nuclear talks began auspiciously -- alas, not before the Barbie-banning ayatollahs extracted an horrific price on its parent Mattel (MAT), which nosedived 9.14% as the iconic doll posted its first sales decline in ten quarters. And on a day a rapping medic with no prior experience on Wall Street was elected the twelfth president of the World Bank, it was announced that there would be no winner of the Pulitzer Prize for fiction. With fact so endlessly fantastical, who needs fantasy? It's a torrid Tuesday on the earnings front, with Coca-Cola (KO), Goldman Sachs (GS), Intel (INTC), International Business Machines (IBM), Johnson & Johnson (JNJ), and Yahoo (YHOO) among a multitude of companies due to report results.


Initiations:

Apple Inc. (AAPL): Can't keep the company out of the news. Shares are rebounding in the pre-market on a Strong Buy coverage roll out at Raymond James, whose price objective is a relatively restrained $800.

Tiffany & Co. (TIF): The luxury jeweler is a new Neutral at Macquarie.

Investment banks: Susquehanna resumes Raymond James Financial (RJF) with a Positive. It has new Neutrals on Jefferies (JEF) and Greenhill (GHL), and launches LPL Investment (LPLA) and Lazard (LAZ) with Negatives on each, assigning a $21 target price on the latter.

Health care industry: Auriga establishes Buys on both Sagent Pharmaceuticals (SGNT) and Impax Labs (IPXL), rolling out respective price objectives of $22 and $30. It has a Hold, and $16 target, on Warner Chilcott (WCRX).

Biotechs: Achillion Pharmaceuticals (ACHN) and Vertex Pharmaceuticals (VRTX) are each assumed with Outperforms at Credit Suisse.

Cameco (CCJ): JPMorgan has an Overweight on CCJ.

Cerus Corp (CERS): Cantor Fitzgerald begins Buy rated coverage of the small cap stock, assigning it a $5.50 price target. The broker believes that CERS's pathogen inactivation technology will eventually become standard of care in this $6 billion global market.

Fossil (FOSL): Macquarie has a fresh Outperform on FOSL.

Nationstar Mortgage (NSM): Keefe Bruyette covers the company at Outperform.

Laredo Petroleum (LPI): BMO Capital launches Outperform coverage on LPI.

Select Income REIT (SIR): SIR is started at a Market Perform with Wells Fargo.

Rollins Inc. (ROL): Shares are a Hold at KeyBanc Capital.

Qualcomm (QCOM): The tech company is picked up at Outperform with Raymond James.


Upgrades:

Travelers (TRV): The property and casualty insurance outfit, yesterday's top Dow stock, is today taken to Equal Weight from Underweight at Evercore.

Trina Solar (TSL): Auriga ups its rating to Buy from Hold, sending shares up sharply before the opening bell.

Teekay Tankers (TNK): Bank of America-Merrill Lynch lifts TNK to Neutral from Underperform.

Terex (TEX): TEX is moved to Outperform from Market Perform with Wells.

SAP AG (SAP): The German software giant, downgraded elsewhere this morning, is also boosted to Buy from Hold at Société Générale.

AutoNation (AN): Wells Fargo raises AN to Market Perform from Underperform.

Energy stocks: Oasis Petroleum (OAS) and Newfield Exploration (NFX) both get Buy-from-Hold boosts at Jefferies.

Energy stocks: GenOn Energy (GEN) is hoisted to Hold from Sell by Deutsche Bank, where NRG Energy (NRG) is now Buy from Hold.

ENI S.p.A. (E): Jefferies juices the Italian oil and gas firm to Buy from Hold.

ING Groep (ING): ING is now Neutral from Underperform at Exane BNP Paribas.


Downgrades:

First Solar (FSLR): With news just breaking that FSLR is to cut 30% of its workforce, the firm gets downgraded to Neutral from Buy at Goldman Sachs.

Cabela's (CAB): The hunting and shooting retailer is cut to Hold from Buy with a $40 objective at Feltl & Co, which cites valuation issues.

Celestica (CLS): Shares are lower ahead of the open on a downgrade to Hold from Buy at Deutsche Bank.

CSX Corp (CSX): The railroad company gets cut to Hold from Buy at Argus, which believes the risk to profit growth over the near-term has increased due to continued weakness in its coal business.

YPF Sociedad Anonima (YPF): The just-nationalized Argentine energy behemoth, trading at a fresh trough, is lowered to Underperform from Neutral by Bank of America-Merrill Lynch and Underperform from Neutral at Credit Suisse. Speaking of which...

Repsol SA (REPYY): The Spanish firm, whose head has claimed Argentine President Cristina Fernandez "carried out an unlawful act" in authorizing the YPF takeover, is itself cut to Hold from Buy by both Jefferies and Deutsche Bank. Shares are slumping in European trading this morning as a result.

Remy Cointreau (REMYF): France's Cognac king is cut to Neutral from Outperform by BNP Paribas

SAP AG (SAP): The German software giant gets downgraded to Neutral from Overweight at HSBC Securities, whose concerns include execution issues in North America.

Synaptics (SYNA): Shares are now Neutral from Buy at Mizuho, which trims its target by $2 to $35.

Progress Energy (PGN): Barclays cuts the stock to Equal Weight from Overweight.

Infosys (INFY): Goldman gives the recently-slumping Indian outsourcer a Neutral-from-Buy ratings reduction.

Insurance stocks: Evercore cuts Chubb (CB), W.R. Berkley (WRB), and Arch Capital (ACGL), all now Equal-Weight from Overweight.
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No positions in stocks mentioned.
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