There's a chill in the air and a slight up-tick in confidence. Holiday discounts are coming a bit earlier, too. For retailers, this has been a great combination, leading to the second consecutive month in which retail sales increased.

This follows more than a year of drops. Consumers aren't going crazy, but they are loosening their wallets a little bit. Consumer spending accounts for 70% of the U.S. economy, and the coming holiday season is where the action is -- for the retail sector and, consequently, for everyone else.

Analyst upgrades:

• Deutsche Bank upgraded HealthSouth (NYSE: HLS) and Rehabcare (NYSE: RHB) to Buy from Hold after raising its Post Acute Care sector view to Positive from Neutral. The firm believes volumes and margin leverage can drive better than expected Q2 results and 2009 guidance. The firm raised its target on HealthSouth shares to $16 from $12 and on Rehabcare to $28 from $19.
  
• Jefferies upgraded Moody's (NYSE: MCO) to Hold from Underperform to reflect stabilizing credit markets and its belief regulatory concerns are overstated. The firm raised its target on shares to $30 from $19.
  
• Keefe Bruyette upgraded Goldman Sachs (NYSE: GS) to Outperform from Market Perform as it finds the stock inexpensive following the better than expected results. The firm has a $195 target on shares.
• Vale (NASDAQ: VALE) was upgraded to Buy from Neutral at BofA/Merrill.
  
• CNOOC (NYSE: CEO) was upgraded to Overweight from Equal Weight at Morgan Stanley.
  
• International Game Tech (NYSE: IGT) was upgraded to Buy from Neutral at Janney Montgomery.
  

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• AnnTaylor Stores Corp. (NYSE: ANN) reported a smaller-than-expected Q1 loss as sales slumped.
• Barnes & Noble Inc. (NYSE: BKS) smaller-than-expected Q1 net loss sent shares higher.
• Children's Place Retail Stores Inc. (NASDAQ: PLCE) solid Q1 results were in line with expectations.
• Dick's Sporting Goods Inc. (NYSE: DKS) posted higher-than-expected Q1 results but same-store sales fell.
• Gap Inc. (NYSE: GPS) lower Q1 earnings beat expectations and lower revenue was in line.

Children's Place (NASDAQ: PLCE) didn't have that bad of a first quarter. I was actually surprised to see increases in both comparable sales and earnings per share. Not every retailer can boast such a claim.

The press release said that net sales from continuing operations were essentially flat. Keeping the top line steady is something of a victory in this economy. On an adjusted basis, Children's Place earned $0.74 per diluted share from continuing operations. That's actually three pennies better than the previous year's performance. It would have been nice if the retailer had been able to beat the analysts in the expectations game, but it was not to be. The bottom line merely met the call.

On Tuesday, the Federal Reserve's FOMC holds two-day meeting on interest rates and will announce its decision on Wednesday. The Fed's Ben Bernanke will still be out and about this week, discussing the failure of Lehman Brothers later today, and ending up the week speaking at the Independent Community Bankers of America National Convention and Techworld.

Manufacturing will be in focus this week, starting with industrial production numbers for February and the Empire State Manufacturing Survey Diffusion Index for March scheduled to be released Monday morning. Tuesday morning will bring us the Producer Price Index for February, and Thursday morning comes the Philadelphia Fed Outlook Survey -- Diffusion Index Manufacturing for March.

Last week, JA Solar Holdings Co. Ltd. (NASDAQ: JASO) posted a quarterly loss and lowered its guidance. But as interest in alternative energy continues to grow, analysts polled by Thomson Financial are still looking for good things from solar energy concerns scheduled to report earnings this week.

Strong growth at Trina Solar Ltd. (NYSE: TSL) in the third quarter prompted it to lift its guidance back in October. Analysts expect the Chinese company to post profits that are 76.3% higher than a year ago, or $1.18 per share on revenues of $268.4 million (+225.0%). Though Trina Solar missed estimates in the second quarter, analysts on average recommend buying TSL. Shares are down 81.4% from a year ago and trading near an all-time low.

Earnings of rival LDK Solar Co. Ltd. (NYSE: LDK) are expect to have risen 47.9% to $0.71 per share on revenues of $486.7 million (+206.6%). Also based in China, LDK has not missed estimates in recent quarters; in fact, it blew past expectations in the second quarter. Yet the consensus recommendation is to hold LDK. Like Trina Solar, LDK's shares are trading near an all-time low; the share price has fallen 50.0% in the past year.

Analysts anticipate third-quarter earnings for Canadian Solar Inc. (NASDAQ: CSIQ) to be a whopping 96.3% higher than a year ago, or $0.54 per share on revenues of $248.0 million (+154.5%). The company easily topped estimates in the previous quarter. ReneSola Ltd. (NYSE: SOL) and Suntech Power Holdings Co. Ltd. (NYSE: STP) are also expected to report earnings growth of 29.7% ($0.37 per share) and 23.8% ($0.42 per share), respectively. All three of these stocks reached 52-week lows last week, and all are considered buys.

Rival home improvement chains Home Depot Inc. (NYSE: HD) and Lowe's Companies Inc. (NYSE: LOW) are scheduled to report quarterly results this week. Not surprisingly, given the ongoing housing slump, analysts surveyed by Thomson Financial on average expect both companies to post earnings lower than in the same period a year ago. For Home Depot, that's 61 cents per share, down 20.8%, and for Lowe's, 56 cents per share, down 16.4%. Meanwhile, cabinet maker American Woodmark Corp. (NASDAQ: AMWD), for whom Home Depot and Lowe's are major distributors, is also expected to report lower earnings: 11 cents per share, down 67.6%.

The presidential campaigns have prompted much discussion of energy policy and alternative energy sources. Some solar-energy-related concerns are scheduled to report this week, and expectations seem to be high. Trina Solar Ltd. (NYSE: TSL) is expected to report 81 cents per share earnings, up 67.9%; ReneSola Ltd. (NYSE: SOL) is expected to post earnings of 32 cents per share, up 62.5%; and Suntech Power Holdings Co. (NYSE: STP) is expected to have earnings of 32 cents per share, up 21.9%. Even China Sunergy Co. Ltd. (NASDAQ: CSUN) is expected to have swung to a profit of 3 cents per share, from a per-share loss of 14 cents a year ago.

"If you've visited a mall – or if you've ever bought clothing for toddlers – you might already be familiar with our latest Undiscovered Gem: Children's Place Retail Stores (NASDAQ: PLCE)," says Elizabeth Harrow.

In Schaeffer's Research, the technical and contrarian advisor explains, "The stock is on the ascent, but Wall Street isn't taking much notice."

"The company was founded in 1969, and is based out of Seacaucus, New Jersey. The retailing chain boasts a market cap of just under $1 billion. It is is a member of the S&P SmallCap 600 Index, as well as the S&P SuperComp 1500, which lends the shares a bit of Street cred.

"The firm recently pleasantly surprised investors with its same-store sales figures. During May, sales at stores open for at least 1 year rose by 10%, compared to analysts' expectations for a gain of 4.3%. Total sales for the month galloped 19% higher for the 4-week period ended May 31.

Children's Place Retail Stores, Inc. (Nasdaq: PLCE) has been in the news recently because it hasn't been able to maximize the value of the licensing agreement it made with The Walt Disney Company (NYSE: DIS) for its Disney Store chain a few years ago. In fact, it looks like Disney will be taking a lot of the stores back (I don't think Disney should do this, though). Well, Children's Place got some more bad news Monday in the form of an earnings cut from an analyst. John Zolidis, of Buckingham Research Group, believes Children's Place will achieve $0.40 per share for Q1, a number that is $0.09 lower than his previous earnings expectation. For the year, he thinks the retailer can do $1.44 per share; his previous estimate was $1.55 per share.

Of course, an analyst is not doing his job if he doesn't send something of a mixed message. He's cutting his expectations for earnings while at the same time saying that the valuation might be attractive at the moment for Children's Place's stock. Well, I sort of understand what he is saying, but let me say this: I don't like Children's Place right now and won't be buying shares, good valuation or not. This is one of those stocks and companies that just doesn't inspire confidence; the retailer plays in a tough niche, the stock is well off its highs, it couldn't properly grow Disney's retail operations, and, perhaps most importantly, there simply might be better ideas out there. If one wants to play retail, why not a Wal-Mart Stores, Inc. (NYSE: WMT) or a Target Corporation (NYSE: TGT)?

Nope, I'm not interested in Children's Place. With this earnings cut, and with stronger retailers up for consideration, I think investors might do better buying something else. Yes, the stock and/or company will probably rebound, but I'm just not in the mood to speculate with this brand.

Disclosure: I own shares in Disney; positions can change at any time.

Before the bell: Futures higher ahead of GDP; ORCL drops, CCU climbs, LEN beats

Despite higher costs, ConAgra Foods Inc. (NYSE: CAG) fiscal third-quarter net income climbed 60% to $309.1 million, or 63 cents a share. Sales for the quarter increased 21% to $3.53 billion.

Hoop Holdings, a unit of Children's Place Retail Stores Inc. (NASDAQ: PLCE) and the operator of Disney Store North America, said late on Wednesday that it filed for Chapter 11. Children's Place isn't part of the Chapter 11 petition, but is in talks to sell a substantial part of the Disney Store business to Walt Disney Co. (NYSE: DIS) in order to concentrate on its core namesake brand.

Rambus (NASDAQ: RMBS) shares are advancing another 4.4% in premarket trading after closing up over 38% yesterday following a court decision finding it wasn't guilty of fraud or violating antitrust laws in dealing with an industry group that set technology standards for dynamic random access memory, or DRAM, chips in the 1990s.

Before the bell: Futures point to higher open -- BGP, NKE, C, FDX

General Electric Co. (NYSE: GE) was raised to Buy from Neutral' at Merrill Lynch, due to its defensive positioning in the current economic climate. GE shares are up 1.7% in premarket trading following the upgrade.

Visa Inc. (NYSE: V) shares soared over 28% in their stock market debut Wednesday. Already priced above expectations at $44 per share in the biggest IPO in U.S. history that raised nearly $18 billion, Visa shares closed at $56.50. Many assume that given the successful MasterCard (NYSE: MA) IPO and given Visa's leading position, the shares are worth a shot, especially in today's market conditions.

As Apple (NASDAQ: AAPL) enhances the the security of the iPhone and adds more enterprise-friendly version of firmware by June 2008, IT advisory and consulting firm Gartner Inc, originally concerned about about some security issues, may then raise its recommendation to "appliance-level" support status for the device, permitting it to be used for PIM, e-mail, telephony and browsing applications and more.

The saga of former Children's Place (NASDAQ: PLCE) CEO Ezra Dabah's battle to acquire the company just keeps getting weirder.

Dabah, who "resigned at the request of the board of directors" (file under: How many words can we use to say "fired") back in September over violations of the company's code of ethics, said in an in amended 13-D filing yesterday:

On February 19, 2008, the Company announced that its 2008 annual meeting of stockholders is scheduled to take place on June 27, 2008. An annual meeting of stockholders has not been held by the Company since June 22, 2006, a period of over 18 months. The Reporting Persons believe that there is no reason to delay the annual meeting for another four months. Accordingly, on February 21, 2008, Ezra Dabah filed a complaint (the "Complaint") in the Court of Chancery for the State of Delaware (the "Chancery Court") requesting that the Chancery Court order the Company to hold the annual meeting within 45 days from the filing of the Complaint.

After reports surfaced that The Children's Place (NASDAQ: PLCE) explores a sale earlier this month, the stock surged. Now the company has made it official, hiring Lehman Brothers to explore strategic alternatives, including operational improvements, a recapitalization, or other transactions.

Here's where it gets dicey: The Children's Place has been a train-wreck of late. The stock price has tanked over the past year, the company's auditor has announced it will not stand for re-election because it can't rely on information provided by former CEO Ezrah Dabah, and several shareholder class-action lawsuits are pending against the company.

The rumor is that Dabah, who owns 18% and serves on the board and was fired from the CEO job for failing to comply with company rules regarding insider trading, may be interested in purchasing all or part of the company.

In other words, Mr. Dabah, a big part of the reason the stock is down so much, could stand to benefit from buying it at a fire-sale price. It's a little bit like an employee who set fire to his place of work and then begged the mercy of the court because he was out of a job ... or something.

If Dabah does emerge as a bidder, expect to hear a lot more about Children's Place in the months to come. It could well become the corporate governance freak show of the year.

Children's Place (NASDAQ: PLCE) operates 899 The Children Place stores and 328 Disney Stores. PLCE is recently up $1.58 to $24.23 on renewed takeover speculation. Ex-chief executive, Ezra Dabah, a owner of 17.9% of PLCE, has said he's considering buying the company and engaged Bear Stearns (NYSE: BSC) as his financial adviser. PLCE November option implied volatility of 76 is above its 26-week average of 45 according to Track Data, suggesting traders are positioning themselves for a high share price.

RadioShack (NYSE: RSH), a company with a presence of through approximately 6,000 stores, is recently up .33 cents to $19.78 on renewed & unconfirmed buyout speculation. RSH is expected to report EPS on 10/29. RSH call option volume of 5,206 contracts compares to put volume of 514 contracts. RSH November option implied volatility of 70 is above its 26-week average of 43 according to Track Data, suggesting larger price risks.

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

Shares of Children's Place (NASDAQ: PLCE) were up more than 5% on Friday after the children's clothier and Disney Store owner announced that it was putting itself up for sale. The shares closed at $23.92, well off the 52-week high of $71.81. The company has been mired in scandal and recently CEO Ezra Dabah recently resigned after an investigation found that he had failed to comply with company rules regarding insider trading and reporting. Dabah remains on the board and own 18% of the company.

Here's where it gets interesting. According to The Wall Street Journal, "Mr. Dabah has told acquaintances that he wants to start his own private-equity firm and may be interested in buying Children's Place and the Disney Store chain it operates. Mr. Dabah had been CEO of Children's Place since 1991."

Children's Place hasn't filed a 10-Q in more than a year, has several shareholder class-action lawsuits pending against it, and its auditor, Deloitte & Touche, reported that it would not stand for re-election because it can't rely on information provided by Mr. Dabah and the company.

In other words, a big part of the blame for the company's troubles -- and resulting stock price -- could probably be placed on the shoulders of Mr. Dabah. With the stock so far off its highs, he may stand to benefit from his poor management if he ends up acquiring all or part of the company.