MORNING COFFEE

Housing Problems Continue. The S&P/Case-Shiller index released yesterday showed that home prices in 20 cities dropped in March to mid-2002 levels.   The index is now down 33.1% since its peak in July 2006, and fell 3.6% for March. Banks also have a huge backlog of foreclosures on their books that they will have to eliminate further hurting home prices.  Analysts are now saying that housing will experience a double-dip decline in home prices.

Upgrades

AT&T (T): Hudson Square Research raised their rating from Hold to Buy and raised their target price from $33.00 to $36.00. Pre-market: 31.50 -0.06 (-0.19%)

BlackRock (BLK): Goldman Sachs raised their rating from Neutral to Buy and raised their target price from $229.00 to $240.00. Pre-market: 208.00 +2.44 (1.19%)

Downgrades

Expedia (EXPE): Standpoint Research lowered their rating from Buy to Hold. Pre-market: 27.80 

-0.21 (-0.75%)

Verizon (VZ): Hudson Square Research lowered their rating from Hold to Sell and lowered their target price from $30.00 to $29.00. Pre-market: 36.56 -0.37 (-1.00%)

Tiffany & Co (TIF): Deutsche Bank lowered their rating from Buy to Hold and raised their target price from $65.50 to $76.00. Pre-market: 73.80 -1.86 (-2.46%)

Heinz (HNZ): Goldman Sachs lowered their rating from Hold to Sell and lowered their target price from $53.00 to $49.00. Pre-market: 53.70 -1.22 (-2.22%)

Coverage Reiterated/Price Target Changed

Nokia (NOK): Wedbush reiterated their Neutral rating and lowered their target price from $8.50 to $7.00. Pre-market: 6.48 -0.54 (-7.69%)

Earning Reports

Phillips-Van Heusen (PVH): Reported Q1 EPS of $1.23 beating estimates by +$0.07 on revenue of $1.37 billion, in-line. Pre-market: 68.71 +2.74 (4.15%)

·         Futures at 7:00: Dow -0.1%. S&P -0.1%. Nasdaq -0.2%. Crude -0.3% to $102.35. Gold -0.25% to $1532.00.

·         Europe: London -0.2%. Paris -0.1%. Frankfurt -0.2%.

·         Asia: Japan +0.3% to 9720. Hong Kong -0.2% to 23626. China 0.0% to 2744. India +0.6% to 18609.