MORNING COFFEE

Italian Debt Downgraded.  Debt rating agency Moody's (MCO) announced they were downgrading Italy’s debt rating three notches from Aa2 to A2 with a negative outlook.  The company cited EU sovereign debt, economic slowdown, and the risks of implementing the government's fiscal consolidation program for the downgrade.

Earning Reports

Costco (COST): Reported EPS of $1.08 missing estimates by -$0.02. Pre-market: 80.50 -1.15 (-1.41%)

Monsanto (MON): Reported EPS of -$0.22 beating estimates by +$0.04. Pre-market: 64.90 +1.65 (2.61%)

Upgrades

Walt Disney (DIS): Citigroup raised their rating from Hold to Buy and placed a target price of $36.00 on the company. Pre-market: 30.26 +0.40 (1.34%)

Family Dollar Store (FDO): Raymond James raised their rating from Outperform to Strong Buy and placed a target price of $60.00 on the company. Pre-market: 51.99 +0.50 (0.97%)

Downgrades

Google (GOOG): Stifel Nicolaus lowered their rating from Buy to Hold. Pre-market: 496.12 -5.78 

(-1.15%)

SAP AG (SAP): Natixis lowered their rating from Buy to Neutral. Pre-market: 50.41 +0.42 (0.84%)

Hewlett-Packard (HPQ): JP Morgan lowered their rating from Neutral to Underweight and lowered their target price from $42.00 to $20.00. Pre-market: 22.95 -0.07 (-0.30%)

Coverage Initiated

Dycom (DY): KeyBanc Capital Markets initiated coverage with a Hold rating.

Salesforce.com (CRM): Ticonderoga initiated coverage with a Neutral rating. Pre-market: 114.75 -2.85 (-2.42%)

Becton Dickinson (BDX): CLSA initiated coverage with a Buy rating and target price of $91.00.

Baxter International (BAX): CLSA initiated coverage with an Outperform rating and target price of $66.00.

Netflix (NFLX): Sterne Agee initiated coverage with a Neutral rating. Pre-market: 114.38 -0.52 (-0.45%)

Markets
Futures at 9:05: Dow +0.18%. S&P +0.21%. Nasdaq +0.08%. Crude +2.35% to $77.46. Gold +0.54% to $1625.10.

Europe: London +2.32%. Paris +2.88. Frankfurt +3.46%.

Asia: Japan -0.86%. India -0.46%. Hong Kong and China closed.