Autumn has arrived and the quarter winds down this week. The Dow has been inching toward 10,000 for a while now, though it closed lower in the past three sessions. Can it make it to 10,000 for the start of the third quarter? If so, what will push it higher? If not, what will drag it down further?

• Monday is Yom Kippur, the most solemn of the Jewish holidays; trading likely will be lighter than usual. In the evening, the FDIC meets to discuss how to rebuild the Bank Deposit Insurance Fund.
• Tuesday, the Consumer Confidence Index for September is due and the SEC holds a public meeting to consider more short sale actions.

This week brings a small flurry of end-of-the-calendar-quarter earnings reports. And for the most part, the expectations of the analysts surveyed by Thomson Reuters aren't very high. Companies expected to report declining earnings in the most recently concluded quarter include America's Car-Mart Inc. (NASDAQ: CRMT), Bed Bath & Beyond Inc. (NASDAQ: BBBY), ConAgra Foods Inc. (NYSE: CAG), Jabil Circuit Inc. (NYSE: JBL), Jackson Hewitt Tax Service Inc. (NYSE: JTX), Monsanto Co. (NYSE: MON), and Sonic Corp. (NASDAQ: SONC).

Analyst upgrades:

• Citigroup upgraded Lennar (NYSE: LEN) to Buy from Hold as it believes the company's near-term liquidity profile is improved following the $400M debt issuance. The firm raised its target price to $12 from $11.
• Jefferies upgraded Rowan Companies (NYSE: RDC) to Buy from Hold as it believes jack-up drillers will continue to outperform deepwater names. The firm raised its target price to $27 from $20.
• Keefe Bruyette upgraded First Financial (NASDAQ: FFIN) to Market Perform from Underperform to reflect more positive loan data for the Texas banks. The firm raised its target price on shares to $44 from $38.
• MGM Mirage (NYSE: MGM) was upgraded to Overweight from Neutral at JP Morgan.
• Morgan Stanley (NYSE: MS) was upgraded to Outperform from Market Perform at JMP Securities.
• Brinker (NYSE: EAT) was upgraded to Overweight from Equal Weight at Barclays.

• AFLAC Inc. (NYSE: AFL) reported better-than-expected earnings for the first quarter.
• Ambac Financial Group Inc. (NYSE: ABK) posted a wider-than-expected loss; shares hit new low.
• Amdocs Ltd. (NYSE: DOX) beat Q2 estimates on strength in the managed services businesses.
• Amphenol Corp. (NYSE: APH) beat expectations in the first quarter and raised its guidance.
• Amylin Pharmaceuticals Inc. (NASDAQ: AMLN) posted a larger-than-estimated Q1 loss.
• Aptar Group Inc. (NYSE: ATR) posted record Q1 results and raised its Q2 guidance.
• Bank of America (NYSE: BAC) Q1 earnings plunged on further housing-related write-downs.
• Brinker International Inc. (NYSE: EAT) narrowly beat earnings expectations on cost cutting.
• Bristol-Myers Squibb Co. (NYSE: BMY) beat analysts' estimates for the first quarter.
• Credit Suisse Group (NYSE: CS) reported a wider-than-forecast loss on subprime-related write-downs.
• Cree Inc. (NYSE: CREE) earnings slipped while revenues soared 29%.
• Eli Lilly & Co. (NYSE: LLY) reported worse-than-expected Q1 earnings on discontinued product charge.
• Gannet Inc. (NYSE: GCI) beat low expectations as earnings and revenue continue slump.
• Hasbro Inc. (NYSE: HAS) posted better-than-expected Q1 earnings on international strength.
• JAKKS Pacific Inc. (NASDAQ: JAKK) missed Q1 expectations on restructuring and litigation costs.
• Kimberly-Clark Corp. (NYSE: KMB) beat EPS estimates by a penny, as revenue jumped 10%.

MOST NOTEWORTHY:

• Friedman Billings expects Time Warner Telecom (NASDAQ: TWTC) to post free cash flow growth above consensus expectations and believes carrier spending-concerns are overdone. The firm initiated shares with an Outperform rating and $20 target.
  
• Oppenheimer initiated Verigy (NASDAQ: VRGY) with a Perform rating and $23 target, pointing to the company's tough year over year comps as PC unit growth slows in 2008 as well as its exposure to flash memory chips.
  
• Brinker (NYSE: EAT) was assumed with a Neutral rating at Suntrust, as they expect Chili's to continue to be impacted by weak consumer spending.

• Baird assumed Ulta Salon (NASDAQ: ULTA) with an Outperform rating and $18 target.
  
• Lions Gate (NYSE: LGF) was initiated at Jefferies with a Hold rating and $10-$11 target.
  
• Landstar System (NASDAQ: LSTR) was initiated with a Market Perform rating at Morgan Keegan.

MOST NOTEWORTHY:

• Bear Stearns upgraded the Restaurant Sector to Market Weight from Underweight citing better investor sentiment following Fed rate cuts and the economic stimulus plan; upgraded shares include Brinker International (NYSE: EAT), Cheesecake Factory (NASDAQ: CAKE) and Darden Restaurants (NYSE: DRI).
  
• JP Morgan upgraded shares of Blockbuster (NYSE: BBI) to Overweight from Neutral ahead of the company's Q4 results on March 6, as they believe the quarter will be at least in-line and 2008 guidance will be above Street expectations.
  
• Plexus (NASDAQ: PLXS) was raised to Outperform from Neutral at Credit Suisse as they believe current quarter sales and bookings are tracking ahead.

• Maxwell Technologies (NASDAQ: MXWL) was upgraded to Market Perform from Market Underperform at JMP Securities.
  
• The firm also raised Sotheby's (NYSE: BID) to Market Outperform from Market Perform.
  
• Goldman Sachs added Allianz AG (NYSE: AZ) to its Conviction Buy List.

• Jefferies upgraded shares of Centene Corporation (NYSE: CNC) to Buy from Hold as they expect the company is benefiting from above 20% revenue growth next year and SG&A leverage opportunity over the next 12–18 months.
  
• Bear Stearns upgraded shares of Brinker International (NYSE: EAT) to Outperform from Peer Perform as they believe Brinker's turnaround efforts can enhance shareholder value.
  
• Friedman Billings raised shares of Harmonic (NASDAQ: HLIT) to Outperform from Market Perform based on the favorable outlook for cable and satellite spending on HD video and other projects.
  
• The firm also upgraded Idex Corporation (NYSE: IEX) to Outperform from Market Perform, citing the company's positive 2008 outlook and solid end markets.
  
• Goldman upgraded Royal Dutch Shell (NYSE: RDS.A) to Neutral from Sell on valuation.

• CIBC upgraded J. Crew Group (NYSE: JCG) to Sector Outperformer from Sector Performer and Parker Hannifin (NYSE: PH) to Sector Performer from Sector Underperformer.
  
• Sprint Nextel Corporation (NYSE: S) was upgraded to Outperform from Neutral at Credit Suisse.
  
• RBC Capital Markets upgraded LaSalle Hotel Properties (NYSE: LHO) to Top Pick from Outperform.

• Banc of America downgraded Starbucks Corporation (NASDAQ: SBUX) to Sell from Neutral, and lowered their target to $23 from $27, as they see downside risk to estimates due to slower growth. The firm is concerned that expectations for a near-term recovery are too high.
  
• Goldman downgraded Brinker International (NYSE: EAT) to Sell from Neutral citing macro economic pressure on sales.
  
• Credit Suisse downgraded Healthways Inc (NASDAQ: HWAY) to Neutral from Outperform on valuation.
  
• Fluor Corporation (NYSE: FLR) was downgraded to Hold from Buy at Morgan Joseph on valuation.

• Nokia Corporation (NYSE: NOK) was downgraded to Hold from Buy at WestLB.
  
• Goldman downgraded Cnooc Ltd (NYSE: CEO) to Neutral from Buy.
  
• Credit Suisse downgraded Statoil (NYSE: STO) to Neutral from Outperform.
  
• GameStop Corp (NYSE: GME) was downgraded to Neutral from Buy at UBS.

Although they spent most of the day in the green the indexes gave up ground through most of the session to close just in the red.

The NYSE had volume of 3.6 billion shares with 1,612 shares advancing while 1,706 declined for a loss of 6.18 points to close at 9,428.86. On the NASDAQ, 2.2 billion shares traded, 1,426 advanced and 1,685 declined for a loss of -2.65 to 2,542.24.

EMC Corporation (NYSE: EMC) rose $1.33 (8%) to $19.05; ahead of it's subsidiary VMware making its debut on the NYSE tomorrow in an IPO that analysts are predicting will be big. EMC will retain 90% of the shares. This is likely the reason for the active calls as EMC Corp. (NYSE: EMC) saw heavy volume on the August 19 calls (EMCHT) with over 56,000 options trading.

Centex Corporation (NYSE: CTX) fell $2.78 (-7%) to $35.63. Lennar Corporation (NYSE: LEN) fell $2.53 (-7%) to $32.92. Brinker International (NYSE: EAT) rose $1.82 (7%) to $28.98. The Goodyear Tire & Rubber Company (NYSE: GT) rose $1.70 (6%) to $28.95.

In options there were 5.4 million puts and 5.8 million calls traded for a put/call open interest ratio of 0.92. The CBOE Volatility Index has been high closing today at 26.57. This is the fear indicator of the market. Not only is the index up, but options on the index are high with the CBOE S&P 500 Volatility Index (NASDAQ: $VIX) moving volume on the August 25 calls (VIXHE) with over 35,000 contracts.

Other stocks with active options include State Street Boston (NYSE: STT) saw heavy volume on the November 75 calls (STTKO) with over 60,000 options trading. Most of the active puts were on the indexes and the iShares Russell 2000 ETF (NYSE: IWM) had volume on the August 78 puts (IOWTZ) with over 86,000 options trading.

Kevin Kersten is an Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

MOST NOTEWORTHY:

• Baird upgraded Red Lion Hotels (NYSE: RLH) to Outperform from Neutral based on valuation, brand expansion progress and takeover potential.

• Constellation Energy (NYSE: CEP) was upgraded to Buy from Hold at Citigroup based on higher cash flow expectations and valuation.

• JP Morgan upgraded Brinker (NYSE: EAT) to Overweight from Neutral, and sees potential upside from slower unit development and a possible Mac Grill sale.

• BMO Capital upgraded Nvidia (NASDAQ: NVDA) to Outperform from Market Perform following a strong second quarter.

• Stanford upgraded InfoSpace (NASDAQ: INSP) to Hold from Sell on valuation; They consider the core online segments looks to be priced into the stock and downside support is given with tax credits and the cash balance...

• Citigroup raised Cox Radio (NYSE: CXR) to Hold from Sell.

• JP Morgan upgraded shares of PepsiAmericas (NYSE: PAS) to Neutral from Underweight.

• Friedman Billings upgraded shares of Emulex (NYSE: ELX) to Outperform from Market Perform.

• DirecTV (NYSE: DTV) was raised to Buy from Hold at Gabelli.

• Seagate (NYSE: STX) was upgraded to Buy from Neutral at Goldman.

MOST NOTEWORTHY:

• Merriman upgraded shares of Buffalo Wild Wings (NASDAQ: BWLD) to Buy from Neutral on valuation as they believe the 25% sell-off post in-line earnings is overdone.

• Banc of America upgraded shares of Pepsi Bottling (NYSE: PBG) to Buy from Neutral to reflect the company's earnings power in 2008, ongoing cost controls and more robust product pipeline.

• SMH Capital upgraded shares of Brinker Int'l (NYSE: EAT) as they believe expectations are too low for Q4 and FY08.

• Northwest Airlines (NYSE: NWA) was upgraded to Overweight from Equal Weight at Morgan Stanley on valuation.

• Spectrum Brands (NYSE: SPC) was upgraded to Neutral from Underperform at Buckingham on valuation...

• Gap (NYSE: GPS) was upgraded to Neutral from Underperform at CL King & Associates.

• Raymond James upgraded Ruby Tuesday (NYSE: RT) to Market Perform from Underperform.

• Burger King (NYSE: BKC) was raised to Buy from Hold at Citigroup.

• MetLife (NYSE: MET) was added to Goldman Sachs' Conviction Buy List.

• Bear Stearns upgraded Martha Stewart Living Omnimedia (NYSE: MSO) to Outperform from Peer Perform.

MOST NOTEWORTHY:

• JP Morgan downgraded shares of Shire Plc (NASDAQ: SHPGY) to Neutral from Overweight to reflect risk of Adderall XR patients switching to Vyvanse.

• Deutsche Bank cut Cablevision (NYSE: CVC) to Hold from Buy, saying shares reflect a likely higher bid from the Dolan family.

• ThinkEquity downgraded shares of Yahoo! (NASDAQ: YHOO) to Accumulate from Buy following checks that indicate marginal Panama upside, poor execution in premium display and an incomplete/vulnerable non-premium display strategy.

• Credit Suisse cut Ensco International (NYSE: ESV) to Underperform from Neutral on valuation.

• SMH Capital downgraded Clear Channel Outdoors (NYSE: CCO) to Sell from Neutral and recommended investors to swap into Lamar Advertising Co (NASDAQ: LAMR), based on the company's higher-quality name in the outdoor advertising sub-space...

• Baidu.com (NASDAQ: BIDU) was cut to Hold from Buy at Citigroup.

• Brinker International (NYSE: EAT) was downgraded to Underweight from Equal Weight at Morgan Stanley.

• Hilliard Lyons downgraded Nike Inc (NYSE: NKE) to Neutral from Long-Term Buy.

• Buckingham cut Ashland Inc (NYSE: ASH) and Cabot Corp (NYSE: CBT) to Neutral from Accumulate.

Yahoo Inc. (NASDAQ: YHOO) -- July options expensive into July EPS & Speculation. YHOO is recently trading up $0.19 to $27.61. YHOO is expected to report EPS on July 17. YHOO is frequently mentioned as a merger candidate of MSFT and there are rumors of upper level management changes. YHOO July option implied volatility of 40 is above its 26-week average of 40 according to Track Data, suggesting larger risk.

Brinker International (NYSE: EAT) -- volatility Flat as activists investors circle Restaurant concepts. EAT operates restaurant concepts including Chili's, Macaroni Grill, Maggiano's & On the Border. EAT reported a 2.8% decrease in same store sales in May. EAT is expected to report EPS on August 7. SPHN says "sales turnaround could take longer than expected, as changes at both Chili's and On The Border are in preliminary stages." SPHN goes on to say, "EAT is currently trading at 17.1x our FY08 EPS estimate of $1.89, vs. the group at 19.7x." EAT has a market cap of $3.5 billion with long-term debt of $593 million. EAT reported quarterly March 2007 revenue of $1.1 billion. EAT over all option implied volatility of 28 is near its 26-week average according to Track Data, suggesting non-directional risk.

The Volatility Index for S&P 500 Options (VIX) is up 1.06 to 15.93.

Option volume leaders today are: Yahoo Inc. (NASDAQ: YHOO), Apple Inc. (NASDAQ: AAPL), Google Inc. (NASDAQ: GOOG) and NovaStar Financial (NYSE: NFI).

Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

MOST NOTEWORTHY:

• JP Morgan downgraded L-1 Identity Solutions (NYSE: ID) to Underweight from Neutral based on valuation.

• THQ Inc (NASDAQ: THQI) was cut to Neutral from Buy at Banc of America, as the firm believes further upside to estimates is limited.

• JetBlue Airways (NASDAQ: JBLU) was cut to Neutral from Add at Calyon and to Peer Perform from Outperform at Bear Stearns following reduced guidance and higher fuel costs.

• JP Morgan downgraded Brinker International (NYSE: EAT) to Neutral from Overweight citing challenging fundamentals after the restructuring announcement. Stephens cut Brinker International to Equal Weight from Overweight.

• Elsewhere, Citigroup cut Lexmark Int'l (NYSE: LXK) to Hold from Buy with a $58 target based on valuation...

• Hutichinson Technology Inc (NASDAQ: HTCH) was cut to Underweight from Overweight at JP Morgan.
  

• Punk, Ziegel & Co downgraded KeyCorp (NYSE: KEY) to Sell from Market Perform.

• WR Hambrecht downgraded shares of Silicon Storage Technology, Inc (NASDAQ: SSTI) to Sell from Hold to reflect negative fundamentals in the NOR Flash memory market.

• CIBC downgraded Ipsco Inc (NYSE: IPS) to Sector Underperformer from Sector Performer on valuation.