MORNING COFFEE

Stock Set To Open Lower. U.S Stock futures are pointing lower as European stocks selloff.  Stocks sold off in Europe as U.S. regulators are stepping up scrutiny of Europe's largest banks on concern that the sovereign debt crisis may lead to funding problems. Sweden’s financial regulators chief economist said Swedish banks must do more to prepare for deterioration in Europe's debt crisis and that "it won't take much for the interbank market to collapse." Also it was announced that German Chancellor Merkel and French President Sarkozy rejected an expansion of the 440 billion-euro European rescue fund. Bank shares getting hammered throughout the EU. 10yr Note +23/32 2.088%, 30yr Bond +24/32 3.475%

Upgrades

McDolanlds (MCD): Oppenheimer raised their rating from Perform to Outperform and placed a target price of $100.00 on the company. Pre-market: 86.36 -1.14 (-1.30%)

Panera Bread (PNRA): Oppenheimer raised their rating from Perform to Outperform and placed a target price of $100.00 on the company. Pre-market: 104.00 -2.52 (-2.37%)

Abercrombie & Fitch (ANF): Robert W. Baird raised their rating from Neutral to Outperform and placed a target price of $90.00 on the company. Pre-market: 63.10 -1.77 (-2.73%)

Downgrades

Starbucks (SBUX): Oppenheimer lowered their rating from Outperform to Perform. Pre-market: 37.45 -1.25 (-3.23%)

Coverage Initiated

Harley Davidson (HOG): KeyBanc Capital Markets initiated coverage with a Buy rating and target price of $48.00. Pre-market: 36.00 -1.06 (-2.86%)

Medtronic (MDT): Mizuho initiated coverage with a Neutral rating and target price of $35.00. Pre-market: 31.13 -1.49 (-4.57%)

Mastercard (MA): Sterne Agee initiated coverage with a Buy rating and target price of $390.00. Pre-market: 317.00 -9.22 (-2.83%)

Watson Pharmaceuticals (WPI): Leerink initiated coverage with a Market Perform rating and a target range of $64.00 to $65.00.

Teva Pharmaceuticals (TEVA): Leerink initiated coverage with an Outperform rating and a target range of $48.00 to $50.00. Pre-market: 39.12 -0.99 (-2.47%)

Symantec (SYMC): Jefferies initiated coverage with a Buy rating and target price of $23.00. Pre-market: 16.50 -0.28 (-1.67%)

Visa (V): Sterne Agee initiated coverage with a Buy rating and target price of $110.00. Pre-market: 81.81 -2.18 (-2.60%)

Earning Reports

Dollar Tree (DLTR): Reported EPS of $0.77 beating estimates by +$0.02. Pre-market: 62.85 -3.62 (-5.45%)

Gamestop (GME): Reported EPS of $0.22 beating estimates by +$0.01. Pre-market: 18.42 -2.04 (-9.97%)

JM Smucker (SJM): Reported EPS of $1.12 beating estimates by +$0.04.

Sears Holdings (SHLD): Reported EPS of -$1.13 missing estimates by -$0.48. Pre-market: 56.00 -4.14 (-6.88%)

Stein Mart (SMRT): Reported EPS of -$1.13 missing estimates by -$0.48.

Markets
Futures at 9:00: Dow -2.00%. S&P -2.43%. Nasdaq -2.29%. Crude -2.83% to $85.10. Gold +1.33% to $1817.70.

Europe: London -3.47%. Paris -3.28%. Frankfurt -3.88%.

Asia: Japan -1.25% to 8943. Hong Kong -1.34% to 20016. China -1.61% to 2559. India -2.20% to 16469.