MORNING COFFEE

BP Cuts Dividend. After yesterdays White House meeting, BP (BP) announced it will suspend its dividend for the rest of the year.  The company also agreed to a $20 billion fund to cover costs related to the Gulf spill, as well as a 10% cut in 2010 capital spending and a $10 billion asset sales program to help fund the account. Today BP’s CEO Tony Hayward will testify before Congress about the spill. 

Initial Jobless Claims Spike. Initial jobless claims for the week of June 12^th spiked to 472,000 well above the 450,000 that economist had estimated.  The number of people continuing to claim benefits rose by 88,000 to 4.57 million, which doesn't include the 5.2 million people who receive extended benefits paid for by the federal government. A total of 9.7 million people received unemployment insurance in the week ending May 29.

Aetna Says They Will Beat Estimates. Aetna (AET) announced they expect to beat their 2^nd quarter estimates.  Wall Street analysts had expected the company to report earnings of $0.68 per share.  The company is scheduled to report their results on July 27^th before the market opens.

Upgrades

Spectra Energy (SE): Jefferies upgraded their rating from Underperform to Hold and raised their target price from $18.00 to $20.00.

EMC (EMC): Argus raised their rating from Hold to Buy and placed a target price of $25.00 on the company.

Coverage Initiated

General Dynamics (GD): HSBC Securities initiated coverage with an Overweight rating and target price of $75.00.

Lockheed Martin (LMT): HSBC Securities initiated coverage with a Neutral rating and target price of $85.00.

Coverage Reiterated/Price Target Changed 

Apple (AAPL): Kaufman Bros reiterated their Buy rating and raised their target price from $320.00 to $340.00.

Sunoco (SUN): Caris & Company reiterated their Average rating and raised their target price from $28.00 to $37.00.

Sunoco (SUN): Howard Weil reiterated their Market Perform rating and raised their target price from $33.00 to $39.00.

·         Futures: Dow +0.3%. S&P +0.3%. Nasdaq +0.3%. Crude -0.3% to $77.44. Gold +0.35% to $1234.80.

·         Asia: Japan -0.7% to 9999.4. Hong Kong +0.4% to 20138. China -0.4% to 2560. India +0.9% to 17617.

·         Europe: London +0.8%. Paris +0.9%. Frankfurt +0.5%.