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Monday, July 7

• San Francisco Fed Reserve Bank President Yellen to speak about the U.S. economic outlook at the University of California/San Diego with a Q&A session.
• Aracruz Cellulose (NYSE: ARA) to report Q2 earnings; conference call at 11:00am.

Tuesday, July 8

• Richmond Fed Reserve Bank President Lacker to speak about U.S. economic outlook to the National Economists Club in Washington with a Q&A session expected.
• Gulfmark Offshore, Inc. (NYSE: GLF) to discuss the acquisition of Ridgon Marine at 9:00am.
• Alcoa Inc. (NYSE: AA) to report Q2 earnings; conference call at 5:00pm.
• Hansen Natural Corporation (NASDAQ: HANS) to give Business News update at 5:00pm.

MOST NOTEWORTHY: Tower sector stocks, Tesco Plc and Alcoa were today's noteworthy upgrades:

• RBC Capital upgraded American Tower (NYSE:AMT), Crown Castle( NYSE::CCI), SBA Comm (NASDAQ:SBAC) to Outperform from Sector Perform citing recent weakness in the tower sector group and a continued favorable outlook.
  
• Merrill upgraded shares of Tesco (Other OTC:TSCDY) to Buy from Neutral as they believe it is the only proven growth stock in the sector.
  
• Soleil upgraded shares of Alcoa (NYSE:AA) to Hold from Sell on valuation following the recent weakness.

OTHER UPGRADES:

• Arch Coal (NYSE:ACI) and Peabody Energy (NYSE:BTU) were upgraded to Buy from Hold at Citigroup.
  
• L-3 Comm (NYSE:LLL) was raised to Outperform from Neutral at Cowen.
  
• Jacobs Engineering (NYSE:JEC) was lifted to Buy from Hold at Morgan Joseph.

Soleil upgraded Alcoa (NYSE:AA) to "hold" from "sell", according to Briefing.com. The news service also reports that Citigroup upgraded Peabody Energy (NYSE:BTU) to "buy" from "hold".

D.A. Davidson raised it price target on Talbots (NYSE:TLB) from $7.50 to $12.50, according to the AP.

Douglas A. McIntyre is an editor at 247wallst.com.

Alcoa (NYSE: AA) closed at $39.12 Thursday.

AA is scheduled to report Q2 EPS on July 9.

Goldman Sach's says: "Unexpected smelter shutdown increases negative margin pressure."

AA July option implied volatility of 58 is above its 26-week average of 45 according to Track Data, suggesting larger price movement.

Volatility Index S&P 500 Options-VIX at 21.57; 10-day moving average is 22.44.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Before the bell: Oil, financials woes send futures lower

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• ADC Telecommunications Inc. (NASDAQ: ADCT) beat Q2 estimates and raised its full-year guidance.
• Alcoa Inc. (NYSE: AA) near-term earnings prospects led to an analyst downgrade.
• Banco de Chile (NYSE: BCH) earnings prospects after an acquisition led to an analyst's upgrade.
• Benihana Inc. (NASDAQ: BNHN) posted lower Q4 profits but still beat earnings estimates.
• Bob Evans Farms Inc. (NASDAQ: BOBE) reported solid Q4 results due in part to cost management.
• Brown-Forman Corp. (NYSE: BF.B) easily beat Q4 estimates and offered full-year guidance.
• CMGI Inc. (NASDAQ: CMGI) lowered its guidance, sending shares tumbling 25%.
• Coca Cola Hellenic Bottling Co. (NYSE: CCH) warned of weaker earnings due to economic conditions.
• Conn's Inc. (NASDAQ: CONN) reported solid Q1 results and issued in-line guidance for the year.
• Dick's Sporting Goods Inc. (NYSE: DKS) earnings prospects impress analysts despite recent guidance.
• Guess? Inc. (NYSE: GES) topped Q1 expectations due to strong international expansion.
• Krispy Kreme Doughnuts Inc. (NYSE: KKD) swung to a Q1 profit despite falling revenues.
• Lehman Brothers Holdings Inc. (NYSE: LEH) posted a bigger-than-expected loss on further write-downs.

MOST NOTEWORTHY: Alcoa, Publicis Groupe and Fresenius were today's noteworthy downgrades:

• JP Morgan downgraded shares of Alcoa (NYSE: AA) to Neutral from Overweight as they do not believe the company is a takeover target. The firm thinks investors could be disappointed with the new CEO's strategic direction as well as near-term earnings.
  
• Societe Generale cut Publicis (OTC: PUBGY) to Sell from Buy on valuation following the recent rally and macroeconomic concerns.
  
• UBS downgraded Fresenius (NYSE: FMS) to Neutral from Buy citing valuation, but added shares to its Short-Term Buy list citing potential upward EPS revisions when the company reports on July 3.

OTHER DOWNGRADES:

• Annaly Capital (NYSE: NLY) and Microchip (NASDAQ: MCHP) were lowered to Neutral from Overweight at JP Morgan.
  
• Soleil downgraded Steris (NYSE: STE) to Sell from Hold.
  
• Goldman added National Grid (NYSE: NGG) and Marshall & Ilsley (NYSE: MI) to its Conviction Sell List and removed Las Vegas Sands (NYSE: LVS) from the Conviction Buy List.

Before the bell: Futures higher ahead of Beige Book, oil supplies

Alcoa Inc. (NYSE: AA) said its Australian operations declared force majeure under supply contracts because an explosion at a gas supplier slowed production. Alcoa said the disruption will likely lower second-quarter earnings by 2 cents to 3 cents a share. Also, JP Morgan downgraded Alcoa from Overweight to Neutral, saying the company will not be a takeover target.

Bloggers, investors and Apple Inc. (NASDAQ: AAPL) weren't just interested in the new 3G iPhone unveiled Monday. Many of them commented on the appearance of CEO Steve Jobs and voiced concerns for his health, saying he was gaunt-looking. While a spokeswoman said Jobs was hit with a common bug, many are worried since Jobs was diagnosed with a rare form of pancreatic cancer four years ago, for which he underwent surgery that Apple said was successful.

Caterpillar (NYSE: CAT) was awarded a $397.1 million contract from the U.S. Army for two types of dozers with armor kits. The contract has one five-year option. Work is expected to be completed by 2018. Caterpillar is also holding its annual meeting today.

Citi Investment Research affirmed Plexus (NASDAQ: PLXS) affirmed its "hold" rating ahead of the company's analyst meeting, according to the AP.

J.P Morgan downgraded Alcoa (NYSE: AA) to "neutral" from "overweight," according to Briefing.com. The news service also reports that Friedman Billings affirmed its "outperform" rating on Kroger (NYSE:KR.)

Intuit (NASDAQ: INTU) was started as Neutral at Goldman Sachs, according to 24/7 Wall St.

TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.

Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.

Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.

Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.

Or how about all of the companies involved with process and flow control and efficient motors: Parker-Hannifin (NYSE: PH) (Cramer's Take), Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Flowserve (NYSE: FLS) (Cramer's Take). Those work higher with higher energy prices. CSX (NYSE: CSX) (Cramer's Take), Burlington Northern (NYSE: BNI) (Cramer's Take), Kansas City Southern (NYSE: KSU) (Cramer's Take), Union Pacific (NYSE: UNP) (Cramer's Take) and Norfolk Southern (NYSE: NSC) (Cramer's Take) are smaller energy users than trucks, and they ship plenty of ethanol and fertilizer.

Alcoa Inc. (NYSE-AA) is recently down 30 cents to $37.70.

AA call option volume of 53,011 contracts compares to put volume of 14,940 contracts. AA May 37.5 straddle is priced at $2.90. AA May option implied volatility is at 57; June is at 47, above its 26-week average of 42 according to Track Data, suggesting larger risk.

Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Alcoa (NYSE:AA) is recently down 27c to $34.50. AA call option volume of 8,138 contracts compares to put volume of 735 contracts. AA May option implied volatility of 40 is near its 26-week average according to Track Data, suggesting non-directional risk.

Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Goldman Sachs (NYSE: GS) sure is a downer. I was starting to feel a little better about the market when it decided to say some bad things about the upcoming earnings season. Thanks a lot, Goldman! According to this Bloomberg article, Goldman believes that earnings for companies will be, overall, very bad, and that the broad market will be brought down by them. Already, reports by General Electric (NYSE: GE) and Alcoa (NYSE: AA) have rocked Wall Street -- and not in a good way, let me tell you. Goldman's David Kostin is, in fact, disagreeing with other analysts who believe that the quarter won't be so terrible; he also thinks the S&P 500 will be lower by the end of the year by perhaps 6%.

So, what does this tells us as investors? First of all, let me say that I think the guy has a point -- when you see GE miss like it did on 4/11, you've got to take notice and be on your guard. In other words, if you're planning on doing some cute buy-a-stock-just-before-it's-about-to-report trading, be extra careful! Now is not the time to take ridiculous chances with investment capital. If you are going to do it, make sure you do it with extra-safe stocks -- then again, if GE wasn't a worthwhile trade in the category I just described, what the heck qualifies for "extra-safe" this quarter? Probably not much. All of us have to realize that the recession is, most likely, real, and that stocks are going to be difficult equities to own.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Acuity Brands Inc. (NYSE: AYI) beat second-quarter estimates on increased productivity and new products.
• Advanced Micro Devices (NYSE: AMD) cut its outlook and announced job cuts.
• Alcoa Inc. (NYSE: AA) missed first-quarter earnings estimates but beat revenue expectations.
• Circuit City Stores Inc. (NYSE: CC) surprised Wall Street by posting a second-quarter profit.
• Dell Inc.'s (NASDAQ: DELL) rosy 2008 forecast is based on cost cuts, overseas growth, share buybacks.
• DuPont & Co. (NYSE: DD) raised its first-quarter outlook on strength in agriculture and emerging markets.
• Eastman Chemical Co. (NYSE: EMN) raised its first-quarter guidance on strong sales and higher prices.
• EXFO Electro-Optical Engineering (NASDAQ: EXFO) beat estimates and announced an acquisition.
• Foundry Networks Inc. (NASDAQ: FDRY) slashed its first-quarter outlook, blaming the weak economy.
• Genentech Inc. (NYSE: DNA) beat first-quarter earnings estimates, but not revenue expectations.
• General Electric Co. (NYSE: GE) missed earnings expectations and lowered its guidance.
• Novellus Systems Inc. (NASDAQ: NVLS) trimmed its first-quarter earnings and revenue forecasts.
• Progressive Corp. (NYSE: PGR) beat estimates though first-quarter profits fell due to lower premiums.
• Rite Aid Corp. (NYSE: RAD) swung to a loss in the fourth quarter on acquisition costs and a tax charge.

Stock futures were lower this morning, indicating the beginning of what could be another down day on Wall Street as more troubling news from the financial industry was reported, while UPS warned of a slowdown in its delivery business.

On Tuesday, U.S. stocks ended lower following a revenue warning from Advanced Micro Devices (NYSE: AMD), a lackluster earnings report from Alcoa Inc. (NYSE: AA), a dividend cut from Washington Mutual (NYSE: WM) and the Federal Reserve minutes, all of which affecting investors' sentiment. The Dow industrials closed 35 points lower, or 0.29%, the S&P 500 lost 7 points, or 0.51%, and the Nasdaq Composite dropped 16 points, or 0.68%.

This morning, given the very light economic calendar consisting of February wholesale inventories at 10:00 a.m. EDT, the Street will likely focus -- once again -- on the troubles in financials. The top story on the Wall Street Journal is about the options the Fed is considering to alleviate the credit crunch further including "contingency plans for expanding its lending power in the event its recent steps to unfreeze credit markets fail." While such plans aren't surprising and even welcome, the report comes after the Fed showed concern the economic downturn could last into 2009 when it released Tuesday the minutes of its FOMC meeting.