Analyst upgrades:

• Barclays believes Procter & Gamble's (NYSE: PG) portfolio mix provides better leverage to stabilizing macro trends. The firm upgraded shares to Overweight from Equal weight and raised its target to $60 from $56. Note the firm downgraded Colgate (NYSE: CL) to Equal Weight from Overweight.
• Deutsche Bank upgraded McDonald's (NYSE: MCD) to Buy from Hold as it finds the risk/reward on shares compelling at current levels and sees upcoming catalysts from McCafe and easing commodity pressures. The firm raised its target price to $65 from $60.
• FBR Capital upgraded Talbots (NYSE: TLB) to Outperform from Market Perform to reflect an attractive risk/reward, reduced risk of a bankruptcy, and merchandise improvements. The firm raised its target price to $4 from $2.
• Nokia (NYSE: NOK) was upgraded to Buy from Hold at Deutsche Bank.
• Analog Devices (NYSE: ADI) was upgraded to Neutral from Underperform at Baird.

PetroChina (NYSE: PTR) closed at $132.04 Friday. WTI Crude Futures are recently up 1.03% to $116.39 according to Bloomberg. PTR over all option implied volatility of 40 is below its 26-week average of 46 according to Track Data, suggesting decreasing movement.

CNOOC Ltd (NYSE: CEO) closed at $133.78 Friday. CEO overall option implied volatility of 43 is near its 26-week average according to Track Data, suggesting non-directional risk.

Canadian Natural (NYSE: CNQ), an oil and natural gas production company, closed at $72.72 Friday. CNQ September option implied volatility of 54 is above its 26-week average of 45, suggesting larger price movement.

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

MOST NOTEWORTHY: American Home Mortgage Investment Corp (AHM), MasterCard Inc (MA) and the selective railroad companies were today's more notable initiations:

• JMP Securities started American Home Mortgage (NYSE: AHM) with a Market Perform frating citing the challenging mortgage market.

• UBS started MasterCard (NYSE: MA) with a Buy and doesn't believe margin upside is fully reflected in the stock's valuation.

• Morgan Stanley initiated five railroad companies: Union Pacific Corp (NYSE: UNP) and Norfolk Southern Corp (NYSE: NSC) with Overweight ratings and Burlington Northern Santa Fe Corp (NYSE: BNI), Canadian Natural Resource Ltd (NYSE: CNQ) and CSX Corp (NYSE: CSX) with Equal Weight ratings.

OTHER INITIATIONS:

• Ceradyne, Inc (NASDAQ: CRDN) was initiated with a Neutral rating at First Albany.

• United Therapeutics Corp (NASDAQ: UTHR) was started with a Buy rating and $81 target at Citigroup.

• Goldman Sachs initiated shares of Aruba Networks, Inc (NASDAQ: ARUN) with a Neutral rating and $16.50 target.

• Saks Inc (NYSE: SKS) was started at Bear Stearns with a Peer Perform rating.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).