Today felt like one of those slow long pre-holiday trading days where many gainers and losers were seen with low volume. There was no real economic data to absorb and no real earnings reports to pick apart.

That let us only react to a small recovery from the fears that the US could ultimately have the same credit rating fears that were brought up about England yesterday. Here were today's unofficial closing bell levels:

Dow 8,278.04 -14.09 (-0.17%)
S&P 500 887.33 -1.00 (-0.11%)
Nasdaq 1,693.91 -1.34 (-0.08%)

Top Analyst Upgrades & Downgrades

Gap (NYSE: GPS) came out with reasonable earnings. For the quarter ended August 2, 2008, net earnings were $229 million, or $0.32 per share on a diluted basis, compared with $152 million, or $0.19 per share, for the second quarter last year.

Second quarter net sales were $3.50 billion, compared with $3.69 billion for the second quarter of last year. The company's second quarter comparable store sales decreased 10%.

A closer look at the numbers, however, shows the extent to which Old Navy is pulling down Gap's results. Same-store sales at Old Navy's North American operations fell 16% on top of a 9% drop during the same quarter last year. Revenue for the division dropped from $1.5 billion last year to $1.3 billion. Most of Gap's other divisions held their own and online and international sales grew.

Gap would be a smaller company without Old Navy, but it would probably be a more profitable one. The company has 3,177 total stores and 1,065 of these are Old Navy outlets. At the very least, Gap should close any of these locations that are not showing year-over-year improvements.

Gap should be doing better, but Old Navy is a boat anchor.

Douglas A. McIntyre is an editor at 247wallst.com.

Google Inc. (NASDAQ: GOOG) recently trading up $15.29 to $609.20.

GOOG is expected to report earnings per share (EPS) on October 18th. GOOG October at the money 580 straddle is priced at $32.10. GOOG October option implied volatility of 38 is above its 26-week average of 27 according to Track Data, suggesting larger risk.

The Gap Inc. (NYSE: GPS) CEO Glenn Murphy hosted a meeting with analysts on October 5th.

Smith Barney says "Mr. Murphy is focused on making the company gets an adequate return on its investments. This includes a focus on the expense of the business. We suspect there will be continued focus on moderating the cost structure and assessing various cost components, including marketing. We think the real estate portfolio is under review." GPS over all option implied volatility of 31 is near its 26-week average according to Track Data, suggesting flat price risk.

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

Byron Pollitt, CFO of Gap (NYSE: GPS) is leaving the company to take the same job with Visa. While there don't appear to be any indications that he was pushed out for wrongdoing, this news is hardly bullish for investors. After all, if he left to pursue an opportunity with Visa, isn't the implication that Gap isn't such a great opportunity right now?

Consider: The job isn't a promotion -- it's the same title. And both companies are located in San Francisco, so we can't even use the "moving closer to home" explanation. No, Mr. Pollitt left because he decided he would rather work for Visa.

With Visa recently having completed a restructuring to prepare for an upcoming IPO, investors may want to follow Pollitt over to that company. If it's a better opportunity for him, it's probably better for investors too.

Gap Inc. (NYSE: GPS) -- September volatility elevated into August 23 EPS and outlook. Gap, the San Francisco based parent company of 3,200 Gap, Old Navy & Banana Republic stores, is expected to report EPS of 19 cents, according to Thomson First Call. GPS September option implied volatility of 40 is above its 26-week average of 29 according to Track Data, suggesting larger price fluctuations.

Foot Locker Inc. (NYSE: FL) -- implied volatility elevated into EPS and outlook. FL, a footwear & apparel operator of 3,950 retail stores, closed at $15.28. FL has a market cap of $2.4 billion with $220 million in long-term debt. FL is expected to announce EPS after the close on August 22. FL over all option implied volatility of 58 is above its 26-week average of 32 according to Track Data, suggesting larger price risks.

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

In a victory of hope over reason, shares in GAP (NYSE: GPS) are up 6% to $16.70 in pre-market trading. The

advance is odd because GAP's July same-store sales were off by 7%.

With the exception of its Banana Republic unit, which saw an increase of 4% in same-store sales compared to a drop of 1% in the same month last year, GAP had another rough month in the U.S. GAP North American dropped 6% on top of another 6% last year. Old Navy fell 9% compared to 5% in the same month in 2006.

GAP did announce that for the second quarter of fiscal 2007, the company expects diluted earnings per share on a GAAP basis between 17 and 18 cents.

Thomson Financial had forecast GAP same-store sales to be down 4.9%. But, the guidance must have fired up Wall Street.

Douglas A. McIntyre is a partner at 24/7 Wall St.

This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and watch out for more Battle of the Brands posts.

Every time I walk through a mall (not too often these days), I see a new "hip" store of which I was previously unaware. I can always count on a few mainstays, though ... the cell-phone-accessory kiosk manned by overly enthusiastic employees, the tantalizing aroma from Auntie Anne's pretzels, and the always tasteful novelty shops. In most malls, I can typically scope out the latest yuppie fashions in either Gap (NYSE: GPS) or Abercrombie & Fitch (NYSE: ANF) (and often-times both). Despite the encroachment of Hot Topic (NASDAQ: HOTT), Pacific Sunwear of California (NASDAQ: PSUN), and other trendy competitors, these two venerable names have stood the test of time, providing relatively affordable threads for men, women, and kids.

In addition to its eponymous chain, which was started in 1969, GPS runs the Old Navy and Banana Republic chains. The retailer's most recent experiment, Forth & Towne (created to appeal to thirty-something career woman) was a bust and has now been abandoned after 18 months. Same-store sales trends have turned south of late, dropping five percent in fiscal year 2005 and slumping seven percent last year. And during the past 12-month cycle, GPS has seen its quarterly earnings drop more than 35 percent. The stock is well off its highs, having lost two-thirds of its value since early 2000. With technical resistance bearing down in the form of the equity's 10-month and 20-month moving averages, relief might not be in sight for a while.

The Gap Inc. (NYSE:GPS) clothing store announced last week that net sales for February 2007 were up 5% to $910 million as compared to $865 million for February 2006. However, in a bit of a twist, comparable sales for that period were down 4% from the same period in 2006. The decrease in comparable sales was across the board for all North American Gap divisions:

• Gap North America comparable sales for February 2007 were down 5%, slightly better than a 7% decrease posted for February 2006.
• Banana Republic North America comparable sales were flat, which is a big improvement over an 11% decrease for February 2006
• Old Navy North America comparable sales declined 6%, still better than the 14% decline recorded in February 2006.
• International sales showed a modest 2% increase, very good news when compared to a 14% decline for February 2006.

Gap opened 80 additional retail locations between February 2006 and February 2007. The company currently has 3,135 store locations. A Gap spokesman called the results expected given the challenging retail environment for Gap and Old Navy.

The Gap Inc. (NYSE:GPS) said net sales of $1.40 billion in November was a 2% decrease from the year-ago November sales month. With holiday shopping already at full-throttle by November, this strikes me as odd. The Gap also reported an 8% decrease in same-store sales this November, compared with half the amount, or 4% reported for the same period last year.

I was traveling at the end of November and saw a Gap store brimming with sales, long lines and stressed clerks, so at least one store in the Midwest seemed to be doing well. I think Gap's Old Navy division was doing more business, but the combined results still pour into a single company balance sheet.

With clothing retailers Kohl's and J.C.Penneys showing results that pumped up same-store sales results for November, I guess Gap's clothing-only business didn't fare as well as the department store approach.

When these numbers were released, Sabrina Simmons, senior vice president of corporate finance at The Gap Inc. said, "Overall, November was a challenging month as negative traffic trends persisted .. promotional and markdown activities at Gap and Old Navy drove total company merchandise margins below last year, and we expect pressure on merchandise margins to continue into December."

When I was in high school, every cool kid had a half-a-dozen pairs of The Gap Inc. (NYSE:GPS) jeans. We'd go shopping in their stores around Christmas season and see four or five of our classmates behind the register, and another 20 or 30 among the customers. In college, Abercrombie & Fitch Co. (NYSE:ANF) became my new aspirational casual retailer of choice, and I could pick their iconic striped sweaters and slim cargo pants out of any crowd.

But now? Gap and Abercrombie, we are so over you!

Amey Stone and I were IM-ing, trying to figure out why this was. We had lots of ideas, firstly, as Amey said, "maybe it's those half-naked men standing in the doorway that are scaring off mothers with young children." This makes sense on a lot of levels. When I was a college kid, the half-naked men were the perfect sex symbol. But the target audience for these clothes has gotten both younger (12- and 13-year-old girls instead of college kids), and older (moms like Amey and me who used to be hot for the half-naked). If the younger set are shopping, in today's increasingly protective culture, they're doing it with mom -- and mom isn't about to bring her 12-year-old into a store that clearly sells sex alongside the sweaters.

As for the older set, we moms with two or three very young children? The last thing we want to see is a half-naked man, even if he's exceptionally cute. Let's be frank. Our libidos are 1/10th of their normal selves thanks to the hormones involved in child-rearing. We'll stick with the J. Crews and the safe boutiques, with the cute little frog umbrellas and not the clothes that make our eight-year-olds look like they're trying out for America's Next Top Swimsuit Model.