MORNING COFFEE

China to Let Yuan Rise. Treasury Secretary Geithner will be holding talks in Beijing tomorrow signaling that Beijing might be paving the way to let the yuan rise. China's National Development and Reform Commission (NDRC),  suggested keeping the yuan "basically stable at a balanced and reasonable level." An economist from the agency also said Beijing should edge towards a more flexible yuan.

Comcast Wins Against FCC. Comcast (CMCSA) won a key verdict against the FCC after a federal appeals court ruled the government does not have the legal authority to force Comcast to refrain from withholding bandwidth from traffic-intensive downloads. The ruling is a blow to the so-called Net Neutrality initiative, which will prohibit all broadband providers from favoring or discriminating against certain kinds of Internet traffic.

Family Dollar Stores (FDO): Reported FQ2 EPS of $0.81 beating estimates by +$0.03 on revenue of $2.1 billion.

Upgrades

K-Swiss (KSWS): Sterne Agee raised their rating from Sell to Buy and placed a target price of $15.00 on the company.

Nokia (NOK): UBS raised their rating from Neutral to Buy.

Downgrades

Sony (SNE): Citigroup lowered their rating from Buy to Hold.

Coverage Initiated

Natl Oilwell Varco (NOV): Dahlman Rose initiated coverage with a Buy rating and a target price of $75.00.

Halliburton (HAL): Dahlman Rose initiated coverage with a Buy rating and a target price of $47.00.

Cephalon (CEPH): Hapoalim initiated coverage with an Outperform rating and a target price of $82.00.

Coverage Reiterated/Price Target Changed

3M (MMM): Argus reiterated their Buy rating and raised their target price from $91.00 to $94.00.

·         Futures: Dow -0.2% to 10895. S&P -0.3% to 1182.75. Nasdaq -0.2%.
Crude -0.6% to $86.33. Gold flat at $1134.60.
30-year Tsy +0.25% to 114-22. 10-year +0.19%. 5-year +0.14%. 2-year+0.04%.
Euro -0.4% vs. dollar. Yen -0.5%. Pound -0.8%. Loonie +0.3%.

·         Asia: Japan +0.1%. China -0.3%. Hong Kong +1.8%. India +0.2%.

·         Europe: London -0.1%. Paris -0.3%. Frankfurt -0.1%.