MORNING COFFEE

Microsoft Announces New Tablet.  In a hastily announced press conference yesterday, Microsoft announced that they would produce their first tablet computer line called Surface.

The device will run Microsoft’s new Windows 8 operating system and be 9.3mm thick, weigh 1.5 lbs, have a 10.6" display, and will come with Office built-in. The tablet will also have a cover that acts as a keyboard with a touchpad. 

This will be a test for the company that has lost ground against both Apple (AAPL) and Google (GOOG) in the tablet and mobile phone wars.  It’s also a risky move, since this will be the first time Microsoft will compete directly against other PC / tablet manufactures that plan on using Windows 8 in their devices.

Upgrades

Watson Pharmaceuticals (WPI): Goldman Sachs raised their rating from Buy to Conviction Buy and placed a target price of $87.00 on the company.

Baxter International (BAX): Goldman Sachs raised their rating from Buy to Conviction Buy and placed a target price of $64.00 on the company.

Nokia Corp (NOK): Avian raised their rating from Neutral to Positive.

Oracle (ORCL): CLSA raised their rating from Underperform to Outperform and placed a target price of $32.00 on the company.

Coverage Initiated

Motorola Solutions (MSI): Northcoast initiated coverage with a Buy rating and target price of $58.00.

Expeditors International (EXPD): Avondale initiated coverage with a Market Perform rating and target price of $42.00.

Forward Air (FWRD): Avondale initiated coverage with a Market Perform rating and target price of $35.00.

Downgrades

Expedia (EXPE): Piper Jaffray lowered their rating from Overweight to Neutral and maintained their target price of $53.00 on the company.

Volvo (VOLVY): HSBC Securities lowered their rating from Overweight to Neutral.

Brinker International (EAT): Raymond James lowered their rating from Strong Buy to Outperform and placed a target price of $35.00 on the company.

Earning Reports

Oracle (ORCL): Reported EPS of $0.82 beating estimates by +$0.04.

FedEx (FDX): Reported EPS of $1.99 beating estimates by +$0.05.

Walgreen’s (WAG): Reported EPS of $0.62 missing estimates by -$0.01.

Markets: 
Futures at 7:29: Dow +0.19%. S&P +0.38%. Nasdaq +0.50%. Crude +0.45% to $83.62. Gold +0.25% to $1630.50. 

Europe: London +6.27%. Paris +0.63%. Frankfurt +0.92%. 

Asia: Japan -0.75%. Hong Kong -0.06%. China -0.66%. India +0.92%.