Morning Coffee Pre-Market Wall Street News

IBM Furloughs Workers. IBM (IBM) announced that it will have a majority of its U.S. hardware workers to take a week off at lower pay.  This announcement comes as the company tries to slash costs in the face of weak sales. IBM's hardware sales slumped 17% year-over-year in Q1 and 12% in Q2. The company’s sales have been hurt by falling UNIX server demand as companies shift their IT hardware spending towards cloud-service companies.

Upgrades:

Fiserv (FISV): First Analysts raised their rating from Equal Weight to Overweight.

Old Dominion Freight (ODFL): RBC Capital raised their rating from Sector Perform to Outperform.

Downgrades:

American Eagle Outfitters (AEO): B. Riley lowered their rating from Buy to Neutral and lowered their target price from $26.00 to $17.50.

American Eagle Outfitters (AEO): Brean Capital lowered their rating from Buy to Hold.

IBM (IBM): Credit Suisse lowered their rating from Neutral to Underperform and lowered their target price from $200.00 to $175.00.

Sony (SNE): Hudson Square lowered their rating from Buy to Hold.

Unilever (UN/UL): JPMorgan lowered their rating from Overweight to Neutral.

Coverage Initiated:

CDW Corp (CDW): William Blair initiated coverage with an Outperform rating.

CDW Corp (CDW): Raymond James initiated coverage with an Outperform rating.

CDW Corp (CDW): Stifel initiated coverage with a Buy rating and target price of $24.00.

Earning Reports:

Cognizant Tech (CTSH): Reported EPS of $1.07 beating estimates by +$0.02.

CVS Caremark (CVS): Reported EPS of $0.97 beating estimates by +$0.01.

DISH Network (DISH): Reported EPS of -$0.02 missing estimates by -$0.56.

Emerson (EMR): Reported EPS of $1.04 beating estimates by +$0.06.

Fossil (FOSL): Reported EPS of $1.10 beating estimates by +$0.16.

Henry Schein (HSIC): Reported EPS of $1.23 missing estimates by -$0.01.

MGM Resorts (MGM): Reported EPS of $0.04 beating estimates by +$0.01.

Tenet Healthcare (THC): Reported EPS of $0.66 missing estimates by -$0.05.

Tidewater (TDW): Reported EPS of $0.68 missing estimates by -$0.09.

Markets: 
Futures at 8:37: Dow -0.14%. S&P -0.16%. Nasdaq +0.04%. Crude +1.00% to $106.87. Gold -1.08% to $1288.30. U.S. 10 Year -4/32 2.657%

Europe: London -0.01%. Paris +0.15%. Frankfurt -0.11%. 

Asia, Japan +1.00% to 14401. Hong Kong -1.34% to 21924. China +0.49% to 2061. India -2.34% to 18,736. 

Morning Coffee Pre-Market Wall Street News

U.S. GDP Tops Estimates. The advanced GDP reading on the U.S. economy was released this morning and topped Wall Street estimates. Economist had expected that the U.S. economy had slowed to a growth rate of only 1.1% down from the previous quarters 1.8% growth.  For Q2 the U.S. economy grew by 1.7%, however Q1 GDP was revised downwards to only 1.1% from the prior 1.8%.

Areas of strength in the economy included: Residential fixed investment which increased 13.4%, personal consumption which rose 1.8% and spending on durable goods which increased 6.5%.

Upgrades:

Boyd Gaming (BYD): JPMorgan raised their rating from Underweight to Neutral and raised their target price from $8.00 to $12.00.

Fresh Del Monte (FDP): CL King raised their rating from Neutral to Buy.

Downgrades:

Barclays PLC (BCS): Societe Generale lowered their rating from Buy to Hold.

Diego PLC ADS (DEO): Canaccord lowered their rating from Buy to Hold.

Jacobs Engineering (JEC): Johnson Rice lowered their rating from Overweight to Equal Weight.

Mosaic (MOS): Scotia lowered their rating from Outperform to Sector Perform.

R.R. Donnelley & Sons (RRD): The Benchmark Company lowered their rating from Buy to Hold and lowered their target price from $20.00 to $15.00.

Sprint Nextel (S): FBR Capital lowered their rating from Outperform to Market Perform and placed a target price of $6.00 on the company.

Earning Reports:

AFLAC (AFL): Reported EPS of $1.62 beating estimates by +$0.11.

Amgen (AMGN): Reported EPS of $1.89 beating estimates by +$0.15.

Anheuser-Bush InBev (BUD): Reported EPS of $0.93 missing estimates by -$0.12.

Comcast (CMCSA): Reported EPS of $0.65 beating estimates by +$0.02.

Fiserv (FISV): Reported EPS of $1.50 beating estimates by +$0.06.

MasterCard (MA): Reported EPS of $6.96 beating estimates by +$0.30.

Symantec (SYMC): Reported EPS of $0.44 beating estimates by +$0.08.

Markets: 
Futures at 6:15: Dow 0.0%. S&P +0.5%. Nasdaq 0.0%. Crude +0.2% to $103.33. Gold +0.5% to $1332. U.S. 10 Year -16/32 2.674%

Europe: London +0.6%. Paris +0.02%. Frankfurt +0.08%. 

Asia: Japan -1.45% to 13668. Hong Kong -0.32% to 21884. China +0.19% to 1994. India -0.05% to 19,339.