MORNING COFFEE

Fed Raises Discount Rate.  The Fed unexpectedly raised the discount rate to 0.75% from 0.5%, in doing so the Fed hopes will encourage banks to borrow from the private market. The Fed said the increase, the first in the discount rate in over three years, doesn't reflect a change in monetary policy and is "not expected to lead to tighter financial conditions for households and businesses."  The news sent stock futures and bond prices down, and the dollar rose against the euro. 

Microsoft Yahoo Search Deal Approved.  U.S. and European regulators approved Microsoft's (MSFT) plan to buy Yahoo's (YHOO) search business. The deal was approved without any restrictions, allowing the companies to put many of the deal's features in place within days.

Google To Become A Utility Co. The Federal Energy Regulatory Commission approved Google's (GOOG) request to become an electricity marketer, allowing it to buy and sell bulk power like a utility. Google has said it has no plans to sell energy management services or speculate in energy markets.

Dell (DELL): Reported Q4 EPS of $0.28 beating estimates by +$0.01 on revenue of $15 billion.

Intuit (INTU): Reported FQ2 EPS of $0.38 beating estimates by +$0.06, on revenue of $837 million.  

The company sees full-year EPS of $1.97 vs. $1.95.

Upgrades

Infosys (INFY): Kaufman Bros raised their rating from Hold to Buy and raised their target price from $58.00 to $67.00.

Adobe Systems (ADBE): FBR Capital raised their rating from Market Perform to Outperform and raised their target price from $36.00 to $39.00.

Downgrades

Anheuser-Busch InBev (BUD): Stifel Nicolaus lowered their rating from Buy to Hold.

Accenture (ACN): Kaufman Bros lowered their rating from Hold to Sell and lowered their target price from $43.00 to $37.00.

Coverage Initiated

Walt Disney (DIS): Jefferies & Co initiated coverage with a Buy rating and a target price of $36.00.

Best Buy (BBY): JMP Securities initiated coverage with a Market Outperform rating and a target price of $45.00.

·         Stock futures: Dow -0.51% to 10322. S&P -0.72% to 1098. Nasdaq -0.49%.

·         Treasurys: 30-yr +0.13%. 10-yr -0.08%. 5-yr -0.17%.

·         Commodities: Crude 0% to $82.44. Gold -0.26% to $1170.90.

·         Currencies: Euro -0.18% vs. dollar. Yen -0.58%. Pound -0.91%.

·         Asia: Nikkei -2% to 10124. Hang Seng -2.6% to 19894. BSE -0.8% to 16192. Shanghai was closed.

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          Europe: London -0.1% to 5317. Paris +0.2% to 3732. Frankfurt -0.2% to 5669.

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