Analyst Upgrades

• BP (BP) to buy from hold at RBS.
• Symantec (SYMC) to buy from hold at Deutsche Bank.
• GenOn Energy (GEN) and Nationwide Health Properties (NHP) to buy from hold at Citigroup.
• Logitech (LOGI) and Patriot Coal (PCX) to neutral from sell, as well as ARM Holdings (ARMH) to buy from neutral, at Goldman.
• Silvercorp Metals (SVM) to outperform from market perform at BMO Capital.
• Cinemark (CNK) to equal weight from underweight at Morgan Stanley.
• Smith & Nephew (SNN) to market perform from underperform at Bernstein.
• Molex (MOLX) to overweight from underweight at JPMorgan.

Some positive signs are blowin' in the wind. Maybe they're enough to underpin a real recovery. Maybe not. But they are definitely positive, and together, may be the foundation of a stock rally with some strength. Here are some of them.

Dividends: General Electric (GE), Weyerhaeuser (WY) and many other companies are raising theirs. GE's quarterly dividend went from 10 cents a share early this year to 12 cents to 14 cents. If you own it by December 27, you'll get it on January 25. GE is almost a surrogate for the economy as a whole since it has so many divisions, offering many products and services. When GE raises its dividend it means the board and management see better times ahead. Companies hate to raise or initiate dividends only to rescind them a few months or even a year later. They know some investors buy the stock for income, and if that shrinks, those investors sell, push the price down and move to another stock. Watch for more companies to raise their payouts (especially banks). It's a sure sign they see better earnings ahead.

Being that I'm a hale-and-hearty defender of the First Amendment, I always take special notice of occurrences which could have significant impact on the dissemination of art, literature, or other such things. Once again, ICANN (Internet Corporation for Assigned Names and Numbers) has quashed a request for a .xxx domain to be created for the registration of "pornographic" websites. I cannot blame ICANN for shying away from giving its approval when I understand that the position of responsibility that approval would place it in is unacceptable for it, and would take the group well outside the scope of what it was created for.

So, we are still faced with the heavy infusion of pornographic material within the mainstream internet, and whether or not something can or should be done about it. I myself am in favor of a designated domain for sexually explicit material, for the simple reason that it would make it easier for parents to have success in restricting those materials from being accessed by their kids. I'm not writing this because I want to debate the existence of porn. I'm simply stating that we still have a situation which, in my opinion, must be dealt with.

I find it rather odd that the Family Research Council applauds the decision of ICANN. FRC claims that to provide a designated domain for the lusty sites would legitimize their existence and create a virtual "red light district" within the mainstream internet. I guess they don't understand that the stuff is already entrenched. I ask the Family Research Council to answer me this: If you were trying to displace prostitutes from your neighborhood would you rather do battle with them on your front porch or send someone else to deal with them in their own home? Your short-sighted approval of the ICANN decision is lost on me. Would it not be better to suggest an amended proposal that would get the job done?

In my considered opinion, this is a matter that shall not quietly pass. What we need to do is create the conditions wherein ICANN can to provide porn its own top-level domain without taking the responsibility to police it. The issue of domain monopoly would also need to be addressed. Then, without involving the courts, porn site webmasters could be encouraged to migrate their content to the new domain. After a reasonable period of voluntary change, I suspect about 70% of the adult sites would have willingly moved to the new domain. Then, I think it would be appropriate for adult sites in other domains to be challenged to prove why they should be allowed to remain outside their available "proper" channels.

I don't mean to say that porn should be stripped from the internet. I'm too much of a constitutionalist for that. I'm just saying that if the porn webmasters wish to remain unmolested on the web, we should create the safe conditions to allow them to do that. We will never do away with porn, but we most certainly can do away with being assaulted by it.

Shareholders of First Republic Bank (NYSE: FRC) are definitely feeling pretty good about themselves today. Shares in the company have been trading up about 40% most of the day following news that the company was going to be bought out by Merrill Lynch & Co. Inc. (NYSE: MER).

The deal is Merrill Lynch's biggest acquisition in almost 10 years. It is worth $1.8 billion and comes to about $55 per per share of FRC. After closing out last week at $38.30, shares of FRC have picked up $15.37 to put it currently at $53.67.

So what exactly is Merrill Lynch thinking by offering a 44% premium over the most recent closing price? Merrill is interested in taking advantage of First Republic Bank's client list -- with an average net worth of $20 million, First Republic will give Merrill more wealthy customers to buy brokerage services. According to Merrill Lynch, the deal will probably not start to add to their profits until the end of next year.

The purchase is scheduled to close in the third quarter should the deal get approval by regulators and shareholders, Merrill said. Should the deal gain approval, FRC will continue to operate as a stand-alone business within Merrill Lynch.

Officials with First Republic have stated that there will be ``virtually no'' job cuts at First Republic as a result of the acquisition.

Merrill Lynch & Co. Inc. (NYSE: MER) stock has traded down 1.1% to $93.48 down $1.05.

Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.