MORNING COFFEE

Banks May Be Downgraded. Credit rating companies have given warnings that banks credit-ratings will likely be downgraded due to last week's Senate passage of the financial reform bill.  The legislation weakens the implied government safety net for banks, and if that feature is maintained in the joint House-Senate version of the bill, then major downgrades are likely in store. This could create billions of dollars in additional financing costs for some of the biggest banks, including Bank of America (BAC), Citigroup (C), Wells Fargo (WFC) and Goldman Sachs (GS).

Upgrades

CA Inc (CA): MKM Partners raised their rating from Neutral to Buy and raised their target price from $23.00 to $26.00.

Garmin (GRMN): MKM Partners raised their rating from Neutral to Buy and raised their target price from $36.00 to $40.00.

Nabors Ind (NBR): C.K. Cooper raised their rating from Hold to Buy and placed a target price of $26.00 on the company.

Transocean (RIG): FBR Capital raised their rating from Market Perform to Outperform and placed a target price of $87.00 on the company.

Coverage Reiterated/Price Target Changed

RF Micro Device (RFMD): Oppenheimer reiterated their Outperform rating and raised their target price from $7.00 to $8.00.

Earning Reports

Campbell Soup (CPB): Reported FQ3 EPS of $0.54 beating estimates by +$0.03 on revenue of $1.8 billion. 

·         Futures: Dow -1.0%. S&P -1.2%. Nasdaq -1.2%. Crude -0.3% to $69.86. Gold +0.8% to $1185.20.

·         Asia: Japan -0.3% to 9758.4. Hong Kong +0.6% to 19668. China +3.5% to 2673. India +0.1% to 16470.

·         Europe: London -0.7%. Paris -0.6%. Frankfurt -1.5%.