MORNING COFFEE

SEC to Charge Banks over Mortgage Bonds. Reports say the SEC has sent Wells Notices to Goldman Sachs (GS), JPMorgan (JPM), and Wells Fargo (WFC) relating to the sale of sub-prime mortgage bonds. The notices are usually an indication that SEC attorneys have recommended that the agency file civil suits.

DOJ launches Criminal Probe Aimed at Banks. The DOJ is investigating the world largest banks to see if they manipulated the Libor inter-bank lending rate.

Upgrades

Chevron (CVX): Deutsche Bank raised their rating from Hold to Buy and raised their target price for $115.00 to $130.00.

Downgrades

Cablevision (CVC): Collins Stewart lowered their rating from Buy to Neutral.

Ecolabs (ECL): JP Morgan lowered their rating from Overweight to Neutral.

Coinstar (CSTR): JP Morgan lowered their rating from Overweight to Neutral and placed a target price of $62.00 on the company.

ITT Educational Services (ESI): Deutsche Bank lowered their rating from Hold to Sell and lowered their target price from $66.00 to $50.00.

Earning Reports

Costco (COST): Reported EPS of $0.90 beating estimates by +$0.03.

Joy Global (JOY): Reported EPS of $1.33 missing estimates by -$0.02.

Staples (SPLS): Reported EPS of $0.41 in-line with estimates.

Markets: 
Futures at 9:11: Dow +0.05%. S&P +0.08%. Nasdaq +0.13%. Crude -0.02% to $106.54. Gold -0.029% to $1783.10. 

Europe: London -0.05%. Paris +0.54%. Frankfurt +0.53%. 

Asia: Japan +0.01% at 9723. Hong Kong +0.52% to 21680. China -0.95% to 2428. India +0.12% to 17753.