MORNING COFFEE

U.S. Banks $60B Short Under Basel III. Yesterday the Fed in a surprise move voted in favor of applying the complex regulations of Basel III to all 7,307 U.S. banks, which also includes small lenders. Analysts estimate that America's 19 largest banks are at least $50 billion short of meeting the new funding requirements under Basel III and that the smaller lenders are about $10 billion short.

Upgrades

SunTrust Banks (STI): Argus raised their rating from Hold to Buy and placed a target price of $30.00 on the company. Pre-market: 21.77 0.00 (0.00%)

Alaska Air Group (ALK): Raymond James raised their rating from Market Perform to Outperform and placed a target price of $30.00 on the company.

Yahoo! (YHOO): Bernstein James raised their rating from Market Perform to Outperform and placed a target price of $19.00 on the company. Pre-market: 15.45 +0.09 (0.59%)

W.W. Grainger (GWW): UBS raised their rating from Neutral to Buy and maintained their target price of $225.00 on the company.

Chevron (CVX): Societe Generale raised their rating from Hold to Buy and placed a target price of $120.00 on the company. Pre-market: 100.09 -0.30 (-0.30%)

Downgrades

Air Products (APD): Robert W. Baird lowered their rating from Outperform to Neutral and placed a target price of $95.00 on the company.

Clean Channel Outdoor (CCO): Evercore lowered their rating from Equal Weight to Underweight.

Coverage Initiated

Cypress Semi (CY): Cantor Fitzgerald initiated coverage with a Sell rating and target price of $11.00 on the company.

Imax Corp (IMAX): Susquehanna initiated coverage with a Neutral rating and target price of $23.00 on the company.

Juniper Network (JNPR): Citigroup initiated coverage with a Buy rating and target price of $22.00 on the company. Pre-market: 16.65 +0.08 (0.48%)

Earning Reports

Quicksilver (ZQK): Reported EPS of -$0.02 missing estimates by -$0.03.

Thor Industries (THO): Reported EPS of $0.78 missing estimates by -$0.01.

Markets: 
Futures at 7:44: Dow -0.40%. S&P -0.42%. Nasdaq -0.47%. Crude -2.94% to $82.33. Gold -0.48% to $1580.20.

Europe: London -0.71%. Paris -0.88%. Frankfurt -0.67%. 

Asia: Japan -2.09%. Hong Kong -0.94% . China -0.51%. India +0.42%.