MORNING COFFEE

Tax Bomb Warning by Fed Chairman. Fed Chairman Ben Bernanke warned that the economy faces a "massive fiscal cliff" come January 1, 2013. With an already slow economy, the U.S could fall off an economic cliff if Congress lets the Bush tax cuts expire on January 1, 2013.  Since, at the same time the Obama administration will be implementing $1.2 trillion in automatic spending cuts. "All those things are hitting on the same day, basically. It’s quite a big event," Bernanke said.

Upgrades

Total S.A. (TOT): Tudor Pickering raised their rating from Accumulate to Buy. Pre-market: 45.68 +1.03 (2.31%)

Oceaneering Intl (OII): Societe Generale raised their rating from Hold to Buy and placed a target price of $59.00 on the company.

JDS Uniphase (JDSU): UBS raised their rating from Neutral to Buy and placed a target price of $14.50 on the company. Pre-market: 11.10 +0.29 (2.68%)

Downgrades

Teva Pharmaceutical (TEVA): Needham lowered their rating from Strong Buy to Hold. Pre-market: 42.49 +0.30 (0.71%)

Oracle (ORCL): ThinkEquity lowered their rating from Buy to Hold and lowered their target price from $36.00 to $28.00. Pre-market: 27.85 +0.07 (0.25%)

3M (MMM): Bernstein lowered their rating from Outperform to Market Perform and lowered their target price from $102.00 to $101.00. Pre-market: 87.00 -0.27 (-0.31%)

Coverage Initiated

Smith & Wesson (SWHC): The Benchmark Company initiated coverage with a Buy rating and target price of $9.00. Pre-market: 7.20 +0.39 (5.73%)

Sturm Ruger & Co. (RGR): The Benchmark Company initiated coverage with a Buy rating and target price of $60.00. Pre-market: 47.67 +0.78 (1.66%)

Phillips 66 (PSX): Goldman Sachs initiated coverage with a Buy rating and target price of $39.00. Pre-market: 33.30 +0.81 (2.49%)

Bayer AG (BAYRY): Societe Generale initiated coverage with a Hold rating.

Sanofi ADS (SNY): Societe Generale initiated coverage with a Buy rating. Pre-market: 36.15 +0.23 (0.64%)

Novartis AG (NVS): Societe Generale initiated coverage with a Buy rating. Pre-market: 52.95 -0.18 (-0.34%)

AstraZeneca (AZN): Societe Generale initiated coverage with a Hold rating. Pre-market: 43.50 +0.06 (0.14%)

Glaxo SmithKline (GSK): Societe Generale initiated coverage with a Buy rating. Pre-market: 45.77 +0.27 (0.59%)

Roche Holdings (RHHBY): Societe Generale initiated coverage with a Buy rating.

Earning Reports

Cisco Systems (CSCO): Reported EPS of $0.10 beating estimates by -$0.01. Pre-market: 17.30 -1.48 (-7.88%)

Monster Beverage (MNST): Reported EPS of $0.41 beating estimates by +$0.03. Pre-market: 74.00 +8.69 (13.31%)

News Corp (NWSA): Reported EPS of $0.37 beating estimates by +$0.06. Pre-market: 20.09 +0.71 (3.66%)

Tesla Motors (TSLA): Reported EPS of -$0.76 missing estimates by -$0.07. Pre-market: 32.60 +2.54 (8.45%)

Dynegy (DYN): Reported EPS of -$0.47 missing estimates by -$0.21.

Kohl's (KSS): Reported EPS of $0.63 beating estimates by +$0.02. Pre-market: 49.19 -1.67 (-3.28%)

Sony (SNE): Reported EPS of -$388.80 missing estimates by -$66.60. Pre-market: 15.61 +0.38 (2.50%)

Markets: 
Futures at 8:46: Dow +0.44%. S&P +0.68%. Nasdaq +0.37%. Crude +0.72% to $97.50. Gold -0.06% to $1593.30. 

Europe: London +0.23%. Paris +0.43%. Frankfurt +0.89%. 

Asia: Japan -0.39%. Hong Kong -0.51%. China +0.07%. India -0.36%.