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Upgrades & Downgrades: Abercrombie Dressed for Success

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

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MINYANVILLE ORIGINAL Mexico, home of the world's biggest bullfighting arena, is weighing a ban but, from Wall Street's perspective, the ebullient animal was once again killed by the more familiar birthplace of the matador. Stocks fell, with the S&P 500 (^GSPC) wrapping up its worst month since September, after Spain officially entered another recession. Investors who say America can decouple from Europe's woes may have a point, or 1.59 to be precise, the infinitesimal amount by which Dow Industrials (^DJI) advanced in April to keep a seven-month winning streak alive. Yet a Chicago manufacturing survey that plunged to its lowest level since November 2009 suggests the Midwest, and not merely Madrid, remains cause for concern. Firearms firm Sturm Ruger (RGR) increased a further 3.50% to a fresh high, taking its 12-month gain to 139.99%, as blue-blood Iberian grandchildren follow the economic example of their elders by shooting themselves in the foot. Barnes & Noble (BKS) closed the book on the month with a 51.68% surge to top the Russell 2000 Index (^RUT) after entering into $300 million college bookstore agreement with Microsoft (MSFT), whose founder didn't care much for campus. A week which will end with millions having headaches from either too many mint juleps in Kentucky or excessive Cinco de Mayo celebrations began with Boston Beer (SAM) ending up 3.36% on a down day. No thanks to Scott Brown, as the senator from Massachusetts isn't actually imbibing alcohol until election day, something the booze-swilling upper management at Groupon (GRPN) may want to emulate. (Granted that the stock, a 10.56% tumble taking it to a fresh IPO low, is enough to drive anyone to drink.)

First Solar (FSLR) slumped 27% in April but it's always sunny in Philadelphia, with the City of Brotherly Love's oil outfit Sunoco (SUN) jumping 20.48% yesterday. J.R. Ewing may surely want to reconsider. NYSE Euronext (NYX) - whose CEO Duncan Niederauer knows a thing or two about German pride - fell 4.88% after the full failure of its proposed Deutsche Börse merger became apparent. In analyst action a downgrade of TreeHouse Foods (THS) sent it sliding 1.42%. Sixties hero Joan Baez, badly needed by Occupy Wall Street in today's May Day demonstrations, is still in shock. Jim O'Neill, global father of the BRICs, is apparently being considered to head the Bank of England but the Manchester United fanatic experienced a little local difficulty closer to home. And on this day in 1931 the Empire State Building was dedicated in the depths of the Depression. It was New York's tallest building until October 19 1970, when the World Trade Center came along. Yesterday, just in time for the first anniversary of the demise of the man who brought the towers down, the World Trade Center once again stands supreme.

Initiations:

Caesarstone Sdot-Yam (CSTE): The manufactured housing firm is a fresh Outperform at Robert W. Baird, whose price objective is $16. The broker says the firm can benefit from a still-early market penetration of quartz products.

ExactTarget (ET): ET is initiated with a Buy at Canaccord Genuity.

FLY Leasing (FLY): FLY is a fresh Outperform with Wells Fargo.

Home Loan Servicing (HLSS): Keefe Bruyette covers the company at Outperform.

Procera Networks (PKT): Raymond James resumes with an Outperform.

Schnitzer Steel (SCHN): Shares are a Hold at KeyBanc Capital.

Stericycle (SRCL): Bank of America-Merrill Lynch begins Buy rated research.

Vantiv (VNTV): Jefferies has a Hold on VNTV.


Upgrades:

Abercrombie & Fitch (ANF): The clothing company stock is up sharply before the opening bell after being added to Top Picks Live list at Citigroup and boosted to Buy from Neutral at UBS.

American Eagle (AEO): Staying in the space, AEO is upgraded to Outperform from Neutral with Wedbush.

AstraZeneca (AZN): Bank of America-Merrill Lynch lifts the British drug maker to Neutral from Underperform.

Cameron International (CAM): HSBC Securities hoists the energy outfit to Overweight from Neutral.

CapitalSource (CSE): Shares are upgraded to Buy from Neutral at Sterne Agee, whose target price is $7.50.

Cardtronics (CATM): CATM gets taken to Overweight from Neutral at Piper Jaffray.

Chinese alternative energy: SunPower (SPWR) is boosted to Buy from Neutral at Citigroup, where Yingli Green Energy (YGE) is now Buy from Sell.

Green Energy (YGE): YGE is now Buy from Sell.

Community Health (CYH): Shares are upgraded to Neutral from Sell at Goldman Sachs.

Cavium Networks (CAVM): Mizuho moves the company to Buy from Neutral with a $35 target, saying improving fundamentals should provide a positive bias to near-to-medium term consensus estimate revisions.

Diamondrock Hospitality (DRH): DRH is upgraded to Perform from Underperform at FBR Capital.

Haemonetics (HAE): Morgan Stanley moves the stock to Equal Weight from Underweight.

ISIS Pharmaceutical (ISIS): Shares are now Overweight from Neutral at Piper Jaffray.

NuVasive (NUVA): NUVA is upgraded to Outperform from Perform at Robert W. Baird.

ProAssurance (PRA): Suntrust takes the stock to Buy from Neutral.

Qualcomm (QCOM): Macquarie moves the tech name to Outperform from Neutral.

Rush Enterprises (RUSHA): The equity is raised to Outperform from Neutral at Credit Suisse.

Texas Roadhouse (TXRH): Shares are taken to Outperform from Market Perform at Raymond James.

Travelers (TRV): The Dow member is upgraded by Sanford Bernstein.

United Utilities (UUGWF): Shares are up in London this morning after Morgan Stanley moved it to Overweight from Equal-Weight, saying "Bad debts are under control."

WMS Industries (WMS): The video game maker is upgraded to Outperform from Neutral at Credit Suisse.


Downgrades:

Accretive Health (AH): AH is cut to Neutral from Buy at UBS.

Costco (COST): The big box retailer is downgraded to Hold from Buy at Deutsche Bank due to a lack of near-term catalysts. Its objective remains $89.

Duke Realty (DRE): DRE is downgraded to Neutral from Buy at Citigroup.

Expedia (EXPE): Shares, recently at fresh highs, are downgraded to Underweight from Equal Weight by Barclays.

Gen-Probe (GPRO): GPRO gets downgraded to Market Perform from Outperform at Raymond James.

Hologic (HOLX): HOLX is now Neutral from Outperform at Macquarie.

Leap Wireless (LEAP): LEAP is lowered to Sector Perform from Outperform at RBC Capital.

McKesson (MCK): Raymond James reduces its rating to Market Perform from Outperform.

Meru Networks (MERU): The small cap stock now Neutral from Outperform at Robert W. Baird.

Semiconductor stocks: Macquarie takes Texas Instruments (TXN), Altera (ALTR), and Xilinx (XLNX) to Neutral from Outperform.
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No positions in stocks mentioned.
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