Macy's (NYSE: M) is expected to report Q3 EPS of 8 cents on 11/14 according to Thomson First Call. M operates 850 stores in 45 states. M overall option implied volatility of 54 is above its 26-week average of 40 according to Track Data, suggesting larger risk.

J.C. Penney (NYSE: JCP) is expected to report 3Q EPS of $1.02 cents on November 15 according to Thomson First Call. JCP closed at $46.31. Alex Brown lowered its price target on JCP to $83 from $55 on November 12. JCP overall option implied volatility of 56 is above its 26-week average of 38 according to Track Data, suggesting larger price risks.

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

MAJOR PAPERS:

• A WSJ.com survey found that economists are more optimistic about the economy and see a lessening chance of a recession, the Wall Street Journal reported.
• Warren Buffett's Berkshire Hathaway Inc (NYSE: BRK.A) sold its shares in the China-controlled PetroChina Company Limited (NYSE: PTR), according to the Wall Street Journal's "Heard on the Street" column, leading many investors uncertain about China's stock valuations.
• The WSJ also reported that a jury in Nevada awarded $134.5M to three women who said hormone therapy drugs manufactured by Wyeth (NYSE: WYE), including Prempro and Premarin, caused their breast cancer.

OTHER PAPERS:

• The SEC began an inquiry into oversight of the New York State pension fund. The SEC is trying to find out if civil violations of federal securities laws were committed, the New York Times reported.
• Over 90,000 children's products imported by J.C. Penny Company (NYSE: JCP) from China, Taiwan and Vietnam, were recalled because of dangerous levels of lead, the Associated Press reported.

WEB SITES:

• Google Inc (NASDAQ: GOOG) said on its blog that it has improved its service for the Shanghai and Shenzhen stock exchanges by providing pricing data in real time and hopes the SEC will approve their "Last Sale" proposal, which would allow users free and unlimited access to real-time last sale prices for the NYSE and Nasdaq stocks.

Monday August 13

• Sysco Corporation (NYSE: SYY) to report Q4 earnings; conference call at 9:45am.
• PDUFA date for Indevus Pharmaceuticals Inc's (NASDAQ: IDEV) Sanctura XR, an overactive bladder drug.

Tuesday August 14

• The Home Depot Inc (NYSE: HD) to report Q2 earnings; conference call at 9am. Home Depot is expected to post substantial Q2 revenue/EPS declines, but equally important will be the company's comments: with the housing sector expected to remain sluggish through at least late 2007, analysts will evaluate whether HD can overcome that headwind with a new focus on customer service, demographic trends that suggest increased home repair/remodeling, and 20-year high homeownership rates that suggest steady house goods demand.
• District Court California: Broadcom Corporation (NASDAQ: BRCM) to request an injunction related to Qualcom Incorporated's (Nasdaq: QCOM) infringement of 3 Broadcom cellular baseband patents.

Wednesday August 15

• Macy's Inc (NYSE: M) to report Q2 earnings; conference call at 10:30am.
• PDUFA date for GPC Biotech's (NASDAQ: GPCB) Satraplatin for treatment of hormone refractory prostate cancer.

Thursday August 16

• JC Penney Co Inc (NYSE: JCP) to report Q2 earnings; conference call at 9:30am.
• Hewlett Packard Company (NYSE: HPQ) to report Q3 earnings; conference call at 5pm. Analysts will evaluate HPQ's ability to maintain momentum in its innovative imaging/printing group, which is expected to help HPQ post solid Q3 revenue gains.

Friday August 17

• Quantum Corporation (NYSE: QTM) to hold annual shareholder meeting at 12pm.
• PDUFA Date for Endo Pharmaceuticals Holdings Inc's (NASDAQ: ENDP) and Vernalis PLC's (OTC: VNLSY) Frova, for menstrually-related migraine headaches.

More retail same-store sales results came in this week, and retailer J.C. Penney Company, Inc. (NYSE: JCP) stated yesterday that same-stores sales rose 2.6% in December. The hot categories in December during the holiday shopping season were, not surprisingly, children's merchandise, fine jewelry and fashion jewelry.

Shares of JCP were mixed this morning as the retailer's results for December beat analyst expectations of 2.4%, and Penneys also beat the year-ago same-store sales growth amount of 2.2%, which it reported in January of 2006.

Penneys also said that seasonal and gift categories like home entertainment also contributed to solid gains i December. Regarding January predictions, the retailer indicated that a low-single-digit rise in same-store sales in January would occur, and that it expects direct sales to be down slightly compared with a 4.3% growth rate in the year-ago period.

Here's a development that should be mildly unsettling for J.C. Penney shareholders: In a terse press release that came across the wire at 1 PM EST today, J.C. Penney announced that it was firing its Chief Operating Officer, Catherine West. No reason was given. The stock is down 1% on the news, but if you called Jim Cramer and asked him what to do, I'm 99% sure I know what he'd say: Sell the %$@@#!! stock!

True, it's most likely nothing. But Cramer's policy on executive terminations and resignations is simple: Shoot first, ask questions later. That kind of thinking would have saved you from a lot of disasters. With a chance to get out of the stock without much of a drop (and the reportedly slow holiday season for retailers just behind us), investors may want to consider dumping J.C. Penney Company, Inc. (NYSE:JCP) like it dumped its COO.

Kohl's -- the department store outside the mall -- released financial results for its third quarter yesterday. The chain reported third quarter earnings per share of $0.68, compared to $0.45 during the same period a year ago. Analysts estimated that Kohl's would earn $0.64, so the company blew past its expectations pretty nicely.

Revenue for Kohl's increased 16.6% to $3.6 billion from the year-ago quarter of $3.1 billion and quarterly same-store sales increased 8.5% as well. Kohl's raised its earnings guidance for its 2006 fiscal year from the range of $3.04 - $3.13 per share to between $3.16 and $3.24 per share.

With both retailers J.C. Penney (NYSE:JCP) and now Kohl's Corp. (NYSE:KSS) reporting better-than-expected results for their most recent quarters, where is competitor Sears Holdings (NYSE:SHLD) going to land? And what about discounter Target Stores (NYSE:TGT) that also faces increased competition from resurgent retailers like Kohl's, Sears and J.C. Penney?

Sears, best known in history for its catalogs, will be landing its results on the day of November 16 , next Thursday. Stay tuned as I'll be covering what Sears is up to. And, if the competition is any sign, Sears may have a decent quarter coming up next week.

Tomorrow morning, retailer J.C. Penney (NYSE:JCP) will be reporting earnings for its fiscal third quarter. If same-store sales growth figures for the retailer are any indication for tomorrow's earnings, then tomorrow JCP shares will most likely be trading up. But, then again, the market reacts strangely sometimes to good news, so who knows. With the holiday shopping underway, though, JCP's fourth quarter should be hefty just like almost any other retailer in existence.

For J.C. Penney's most-recent quarter, the retailer reported same-store sales growth -- sales in stores open at least one year -- of 8.1%. While September's figure was 8.7%, there was a 0.5% decline in August. Strange, as I would have though August -- at least the last half -- would have been strong due to the "back to school" shopping seasonality factor.

What to expect tomorrow morning? Just a little over a week ago, the retailer forecast third-quarter earnings from continuing operations of $1.22 per share, which was an increase from the $1.11 per share noted in a prior guidance. The retailer also said that November same-store sales are expected to grow by a low single-digit percentage range after high single-digit gains in both September in October. With these kinds of possible inconsistencies, stay tuned to BloggingStocks for the news tomorrow morning -- I'll be on it, all over it -- something like that.

Retailer J.C. Penney (NYSE:JCP) --- in stark contrast to discount merchandisers Wal-Mart Stores, Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT) --- posted October same-store sales results of 8.1% growth, noting that the increase was due to a strong demand for fall apparel and accessories. Perhaps some shoppers are gearing up for the fall season by turning clothes purchases away from the discount stores and to department stores? That would be a decent assumption, but it's only a guess. At Penney's maybe it really is "all inside" -- at least for this past quarter.

Market analysts were expecting an increase of 6.1 percent according to a Reuters survey, so actual results blasted past those estimates by almost 3 points. And the effect on J.C. Penney shares after the announcement? Shares are down almost an entire point this morning. How little the market operates on logic ---Wal Mart shares and Target shares also started a downward climb after less-than-expected October same-store sales figures were released yesterday.

J.C. Penney blasts through its analysts projections and shares also fall. Madness. We should expect nothing more of a market that is a complete ninny sometimes. J.C. Penney -- based on Plano, Texas -- stated that total department store sales rose 11 percent to $1.3 billion for the four-week period ended October 28 as well.

Futures are positive in early morning trade, pointing to a higher start for stock.

Today investors will analyze the data from the retail sector, they will look at some economic indicators for an idea about employment, inflation and productivity. Strong retail sales could help the market rally, as are the falling oil prices of this morning.

This morning, some retailers have already reported same-stores sales and the market is now looking for a 3.4% rise in October for the industry, or a 4.9% increases ex-Wal-Mart Stores, Inc. (NASDAQ:WMT). Wal-Mart said last week it is expecting a 0.5% gain in same-store sales (sales at stores that have been open at least a year). It had just reported as expected.

Already reporting sales data this morning are Costco Wholesale Corp. (NASDAQ:COST) with a 4% rise, Pier 1 Imports, Inc. (NYSE:PIR) with an over 13% decline in sales, and American Eagle Outfitters, Inc. (NASDAQ:AEOS) that reported an 8% jump in same-store sales last night. AEOS also raised third-quarter earnings guidance. The stock might still be under pressure as some were expecting a 10% rise in sales. Walgreen Co. (NYSE:WAG) Oct same-store sales rose 11.4% and J.C. Penney Co.'s (NYSE:JCP) sales rose 8.1%.

This morning, some economic data is also due out. First, weekly jobless claims will be released at 8:30, but investors are waiting the main job report tomorrow. Also at 8:30, third-quarter productivity and unit labor costs will be reported. Unit labor cost could give investors a better idea about inflation, so barring any surprises, this is the number to watch out for. Finally, at 10:00, September factory orders are due. The European Central Bank makes its decision on interest rate today.

Top news stories this morning:

According to the Wall Street Journal, Tribune Co. (NYSE:TRB) said that due to low bids, it is now prepared to sell parts of the business and will consider offers.

Unilever NV/PLC (NYSE:UN, UL) reported a third-quarter profit drop of 48% after one-time gains from asset sales. Sales rose 1.6%. The figures were at the top end of market forecasts. Unilever shares were up over 4% in Europe.

Reporting today:

• Caremark Rx Inc. (CMX) - 63 cents per share for Q3.
• CVS Corp. (CVS) - 32 cents per share for Q3.
• International Paper Co. (IP) - 43 cents per share for Q3.
• Whole Foods Market Inc. (WFMI) - 29 cents per share for Q4.

Other stories:

Electronic Data Systems Corp. (EDS) reported third-quarter after the bell yesterday with profit climbing sharply to 24 cents per share on a 9% increase in revenue of $5.29. However the company said contracts for future work declined. Analysts were expecting 20 cents per share.

Apple Computer, Inc.'s (NASDAQ:AAPL) new iPod Shuffle will arrives in stores this Friday, tomorrow.

Goldman Sachs upgraded Dell, Inc. (NASDAQ:DELL) to neutral from sell.

General Electric Co. (NYSE:GE) has signed a $300 million deal with a Chinese company to make jet engine parts for it.and French engine maker Snecma.

In the auto industry:

• New car registrations in Germany are expected to have risen in October with foreign automakers boosting their share of Europe's biggest car market to 36.1%.
• Advanced Auto Parts Inc. (NYSE:AAP) reported Q3 (ending Oct 7) net income dropped to $58.9 million, or 56 cents a share but it includes 3 cents a share in stock option expense. Revenue rose to $1.1 billion from $1 billion. Analysts expected earnings of 54 cents a share. The company also lowered Q4 guidance.

Following Baidu.com, Inc.'s (NASDAQ:BIDU) earning, yesterday I revisited rumors of Google, Inc. (NASDAQ:GOOG) or Yahoo!, Inc. (NASDAQ:YHOO) buying Baidu.

Google is releasing a new version of its mobile email today.

Yahoo is going into the food business starting a site offering thousands of recipes, advice from chefs, video cooking guides and easy-to-use Web tools to help cooks answer the daily question: What's for dinner?

Hewlett-Packard (NYSE:HPQ) will have a fourth quarter earnings call on Thursday, Nov. 16, 5:30 p.m. ET/2:30 p.m. PT here.

Wendy's (NYSE:WEN) is offering DVD movie kiosks at its restaurants.

In Pharma: Global pharmaceutical sales grew 5% in the 12 months to August in leading markets, the same rate as recorded a month earlier. Pfizer Inc's (NYSE:PFE) Lipitor cholesterol pill remained the top-selling drug with sales of $11.6 billion.

Russian oil output fell again in October partly because the country and Exxon Mobil (NYSE:XOM) holding back the start up of full-scale production due to differences.

XM Satellite Radio (NASDAQ:XMSR) and Cingular Wireless (held by AT&T (NYSE:T)) announced a partnership to stream 25 XM music channels to Cingular handsets.

Upgrades:

MOST NOTEWORTHY:

• Career Education (CECO) tops today's modest-sized upgrade summary. UBS upgraded Career Education to Neutral from Reduce following the resignation of its CEO, John M. Larson.

OTHER UPGRADES:

• Robert W. Baird upgraded EGL Inc. (EGL) to Outperform from Neutral citing valuation and expectations for re-accelerating top-line growth. They also increased EGL's target to $44 from $40.
• Janney Montgomery Scott upgraded Transaction System (TSAI) to Buy from Neutral based on the expectations for favorable guidance and recommended investors build positions.
• Lear (LEA) was upgraded by UBS to Neutral from Reduce citing a less bearish outlook after the stock's recent move downward.

Downgrades:

MOST NOTEWORTHY:

• Credit Suisse downgraded J.C. Penney (JCP) to Underperform from Neutral based on the risks associated from the company's transition from a margin recovery story to an incremental investment growth story.
• Casino-entertainment provider Harrah's (HET) was downgraded to Neutral from Overweight at J.P. Morgan, citing lagging growth trends in the Las Vegas and Atlantic City markets.
• RBC Capital Markets downgraded the global technology services company Electronic Data Systems (EDS) to Underperform from Outperform this morning. The downgrade was based on the disruptive impact from increased offshore employee mix, overhangs from option grant investigations and lawsuits, and ongoing restructuring and start-up costs.

OTHER DOWNGRADES:

• MasterCard (MA) was downgraded to Hold from Buy by Soleil Securities based on valuation. The firm recommended investors swap out of Mastercard and move into American Express (AXP).
• A.G. Edwards downgraded Altria Group (MO) to Hold from Buy citing the uncertain timing of the break-up after the Schwab case "setback."
• Finally, the tax preparation company Jackson Hewett (JTX) was downgraded to Underweight from Equal Weight by Morgan Stanley, citing additional competition and pricing within the industry.

Research provided by TheFlyOnTheWall.com (subscription required).