Analyst upgrades:

• Keefe Bruyette upgraded Morgan Stanley (NYSE: MS) to Outperform from market Perform after transferring coverage to a new analyst. The firm expects Morgan to benefit from the pending joint venture with Smith Barney and improvements in its operating environment.
• FBR Capital upgraded Winn-Dixie (NASDAQ: WINN) to Outperform from Market Perform as it believes the company is executing well and shares are cheap at current levels. The firm keeps a $16.50 target on the stock.
• Baird believes Polaris's (NYSE: PII) consensus expectations and valuation are too low and that the company will expand beyond powersports. The firm upgraded shares to Outperform from Neutral and raised their target to $37 from $32.
• J. Crew (NYSE: JCG) was upgraded to Neutral from Sell at Goldman.
• Lexmark (NYSE: LXK) was upgraded to Equal Weight from Underweight at Barclays.
• Global Hunter upgraded Big Lots (NYSE: BIG) to Buy from Neutral.

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

• Applied Materials Inc. (NASDAQ: AMAT) posted a Q1 loss and announced a workforce reduction.
• ArcelorMittal (NYSE: MT) swung to it's first ever quarterly loss due to lower demand and a big write-down.
• Buffalo Wild Wings Inc. (NASDAQ: BWLD) shares surged after it posted strong Q4 results.
• Chipotle Mexican Grill Inc. (NYSE: CMG) posted better-than-expected Q4 earnings as revenue surged.
• Genzyme Corp. (NASDAQ: GENZ) topped Q4 earnings estimates, sending shares higher.
• Global Traffic Network Inc. (NASDAQ: GNET) weaker-than-expected Q2 results led to a downgrade.
• Level 3 Communications Inc. (NASDAQ: LVLT) shares fell despite its upside surprise for Q4.
• Lions Gate Entertainment (NYSE: LGF) posted a bigger-than-expected Q3 loss despite revenue growth.

Despite the TARP bank CEOs being grilled on Capitol Hill, the financial stocks and the market eked out a rally. Chicago Federal Reserve President Evans gave a speech today, saying he expects more unemployment and more GDP contraction.

Here are the unofficial closing bell levels:
Top Analyst Upgrades
Top Analyst Downgrades

3M Co. (NYSE: MMM) rose slightly after it actually raised its dividend to $0.51 per share per quarter. It was a mere 2% hike, but it was a hike. The conglomerate shares were up 0.5% at $51.30 right before the close.

Charter Communications (NASDAQ:CHTR) is one of the largest cable companies in the US. It is controlled by billionaire Paul Allen. Like a lot of cable firms, it took on buckets of debt as its improved its infrastructure and bought out other companies in the industry.

Charter's problem is that its debt is now so huge that it can barely operate. According to Barron's, Charter has hired Lazard to help it work out a restructuring of its balance sheet. The firm has over $21 billion in long-term debt and not enough cash flow to handle debt service.

But, Charter bringing in Lazard is not the real story. It is what managements that went for maximum debt for maximum expansion are doing to their common shareholders, especially in an economic environment where credit is impossible to come by.

Charter's shares now trade at $.13, down from a 52-week high of $1.68. Less than two years ago, the stock was close to $5. And, there is only one way Charter is going to solve its problem. It will have to hand the company over to its creditors and leave common shareholders with nothing.

Investors in Sirius (NASDAQ:SIRI), Level 3 (NASDAQ:LVLT), and several other large companies that went nuts on debt are about to go through the same process. With refinancing out of the question, selling shares in those companies is the only way to go, even if all an investor gets is pennies.

It is better than getting nothing.

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

How many days, months, quarters, etc. will this ugly bear market continue? It is just as bad as buying dips on Internet stocks in 2000. The FOMC minutes gave a lowered economic expectation for 2009, like we didn't know that was coming. Housing starts were the worst on record, and now inflation is coming down so hard that deflation is the new damnation of the markets. Does it really matter what gets said anymore? No, it doesn't. Gee, were you even surprised that the deterioration into the close only picked up steam and the Dow shed 5% to close below 8,000 as the S&P decided to close at a five-year low? Sorry there is no good news, but this market is no longer a market.

Citigroup Inc. (NYSE: C) is trading like it is no longer going to be around as its old self. This is truly ugly and unfair, but then again ... who has been rewarded for defending a financial stock? NO ONE. Shares were down 21% at $6.53 before the close.

E*TRADE Financial Corp. (NASDAQ: ETFC) gave pretty decent numbers considering the current climate, yet it is getting crushed every day along with anything and everything else financial. This one was down 17%at $1.03 right before the close.

The shares of Level 3 Communications (NASDAQ: LVLT) are sinking deeper into penny-stock territory this morning following a damaging price-target cut from analysts at Citigroup. The brokerage firm slashed its price target on LVLT from $2.00 to 50 cents, and reiterated its Sell rating on the stock.

After closing Monday at 94 cents, LVLT is slipping ever closer this morning to that hypothetical "support at zero." In fact, following yesterday's all-out bearish note on General Motors (NYSE: GM), one has to wonder if Deutsche Bank will soon be slapping another of its famous goose-egg targets on Level 3. The stock has closed seven out of the past 13 sessions south of the $1 level, and its descending 10-day and 20-day moving averages have provided stubborn resistance in recent months.

In fact, while many analysts have already denounced LVLT, there's still room for potential downgrades or price-target cuts. Zacks reports two Buy or better ratings from brokerage firms, and these bulls may soon be shamed into lowering their opinions (if so, they would join six analysts who consider the stock a Hold, and six who deem it a Sell or Strong Sell).

Meanwhile, Thomson Financial pegs the average 12-month price target at $1.68, a premium of 87% to the equity's closing price on Monday. While more negative notes could drag the shares lower, there is a bright side -- from their current level, the shares could only lose about 85 cents.

Elizabeth Harrow is an analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.

Wall Street's optimism in last week's preview about the earnings of tech stocks wasn't misplaced, as there were many more positive surprises than negative ones among the stocks we looked at. This week will bring plenty more data for investors in and watchers of the sector to mull over. Apple Inc. (NASDAQ: AAPL), AT&T Inc. (NYSE: T), and Microsoft Corp. (NASDAQ: MSFT), for example, are expected by analysts surveyed by Thomson Financial to post modest earnings gains from a year ago, to $1.11 per share (on $8.1 billion in sales), $0.72 per share (on $31.3 billion in sales), and $0.47 per share (on $14.8 billion in sales) respectively. All three of these companies ended the week closer to their 52-week lows than highs, and analysts on average consider them each a buy.

Here's a look at some of the week's biggest expected earnings gainers and decliners in the sector:

• Baidu.com Inc. (NASDAQ: BIDU): $1.25 per share (+44.0%) on revenues of $134.7 million (+103.2%)
• Broadcom Corp. (NASDAQ: BRCM): $0.44 per share (+38.6%) on revenues of $1.3 billion (+33.8%)
• QLogic Corp. (NASDAQ: QLGC): $0.31 per share (+29.0%) on revenues of $170.0 million (+21.2%)
• FLIR Systems Inc. (NASDAQ: FLIR): $0.32 per share (+28.1%) on revenues of $275.2 million (+44.0%)
• Juniper Networks Inc. (NASDAQ: JNPR): $0.30 per share (+26.7%) on revenues of $927.4 million (+26.2%)
• Waters Corp. (NYSE: WAT): $0.75 per share (+17.3%) on revenues of $391.6 million (+11.1%)
• Flextronics International Ltd. (NASDAQ: FLEX): $0.29 per share (+17.2%) on revenues of $8.7 billion (+57.3%)
• EMC Corp. (NYSE: EMC): $0.19 per share (+10.5%) on revenues of $3.7 billion (+12.9%)

Oppenheimer downgraded Level 3 (NASDAQ:LVLT) from Market Perform to Underperform, according to Briefing.com. The news service also reports that Citigroup intiated KB Home (NYSE:KBH) with a Hold.

Petro-Canada (NYSE:PCZ) was cut to Hold at Deutsche Bank, according to 24/7 Wall St. The financial news site also reports that Tween Brands (NYSE:TWB) Cut to Sell at Citigroup.

Douglas A. McIntyre

MOST NOTEWORTHY: Texas Industries, TransGlobe Energy and Level 3 Communications were today's noteworthy downgrades:

• Stephens downgraded shares of Texas Industries (NYSE: TXI) to Equal Weight from Overweight as it believes higher energy costs will affect the company's ability to achieve its guidance. The firm lowered its target to $68 from $83.
  
• Jefferies assumed coverage and downgraded shares of TransGlobe Energy (NYSE:TGA) to Hold from Buy as it sees limited upside until the company completes its seismic activity and can better quantify its exploratory reserve potential. The firm lowered its target to $5.25 from $6.50.
  
• Citigroup downgraded Level 3 (NASDAQ: LVLT) to Sell from Hold as it believes the pullback in telecom valuations increases downside risk for the stock. Citigroup lowered their target price to $2.50 from $3.

OTHER DOWNGRADES:

• Safeway (NYSE: SWY), Sysco (NYSE:SYY) and Whole Foods (NASDAQ: WFMI) were cut to Neutral from Buy at UBS.
  
• Piper lowered Third Wave (NASDAQ:TWTI) to Neutral from Buy.
  
• China Petroleum (NYSE: SNP) was lowered at JP Morgan to Underweight from Overweight.

Today was a very mixed trading day on the economic and news front. Ben Bernanke said that inflation was far higher than he was comfortable with, but he also said he doesn't expect this scenario to become like the one in the 1970s. Oil also slid again to under $123.00 per barrel. Today may have looked better had it not been for some additional downgrade warnings from Moody's on bond insurers. These are the unofficial closing bell levels:

• DJIA 12390.89 (-11.96)
  
• S&P500 1377.24 (-0.41)
  
• NASDAQ 2503.14 (+22.66)
  
• 52-WEEK LOWS
• TOP 10 ANALYST CALLS

AMBAC Financial Group Inc. (NYSE: ABK) and MBIA Inc. (NYSE: MBI) each saw shares punished to 52-Week Lows after Moody's noted that it may cut the bond insurers' "Aaa" rating.

Lear Corp. (NYSE: LEA) was actually rather impressive today. Shares were up 1.2% in the final minutes at $25.05, despite the company issuing an earnings warning this morning.

Level 3 Communications Inc. (NASDAQ: LVLT) saw another active trading day with shares up almost 5% at $3.92 in the final minutes of the day. There are several reasons.

Verizon Communications Inc. (NYSE: VZ) was trading down about 1.1% at $36.9 in the final minutes on reports that it was going to pay some $27 billion to acquire Alltel and its 13+ million wireless subscribers from TPG and GSCP.

MOST NOTEWORTHY: Salesforce.com, First Marblehead and The E.W. Scripps Co were today's noteworthy upgrades:

• Jefferies upgraded shares of Salesforce.com (NYSE:CRM) to Buy from Hold following the company's Q1 results and recommends accumulating shares on any weakness from concerns around a slowdown in bookings. They believe that while bookings growth slowed in Q1, CRM's growth remains stellar and its market opportunity remains large.
  
• Friedman Billings upgraded First Marblehead (NYSE:FMD) to Market Perform from Underperform. The firm believes most of the bad news is reflected in shares and that there are early indications of "thawing" within the private student loan ABS market.
  
• Lehman upgraded the E.W. Scripps Co (NYSE:SSP) to Overweight from Underweight and expects the upcoming July 1st split of Scripps Networks Interactive from Scripps will give the company strategic opportunity by separating high growth cable from traditional newspapers and broadcasting.

OTHER UPGRADES:

• ING upgraded Royal Dutch Shell (NYSE:RDS.A) to Buy from Hold and StatoilHydro (NYSE:STO) to Hold from Sell.
  
• Cost Plus (NASDAQ:CPWM) was raised to Market Perform from Underperform at JMP Securities.
  
• Wachovia upgraded Level 3 (NASDAQ:LVLT) to Market Perform from Underperform.

Today was an odd day, and despite the mixed index levels it should be considered a win. Oil rose sharply and was over $127.00 at one point after the Saudi's said that demand didn't justify increasing production in oil; Goldman Sachs put oil's average target for the second half of 2008 above $140/barrel. To top it off, the controversial University of Michigan consumer confidence level came in at the lowest reading since 1980. Even housing saw strange information as the rise in building permits and housing starts came out much higher than expected: so much for house prices stabilizing.

DJIA 12,983.13 (-9.53; -0.07%)
S&P500 1,425.06 (+1.49; +0.10%)
NASDAQ 2,528.79 (-4.94; -0.19%)
10 Yr Bond 3.850% (+0.007%)
52-week lows
TOP 10 ANALYST CALLS

Ascent Solar Technologies, Inc. (NASDAQ: ASTI) saw a drop-off after it priced a 3.8 million share secondary offering at $14.00, well under yesterday's close. In the final minutes, shares were down 6% at $14.93.

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

• Amazon.com Inc. (NASDAQ: AMZN) profits rose 30%, easily beating analysts' expectations.
• AMETEK Inc. (NYSE: AME) beat Q1 estimates on global strength and recent acquisitions.
• Apple Inc. (NASDAQ: AAPL) easily beat Q2 expectations but offered a weak outlook.
• AT&T Inc. (NYSE: T) posted strong Q1 results thanks to the popularity of the iPhone.
• Baidu.com Inc. (NASDAQ: BIDU) beat earnings and saw an upgrade from Citigroup Inc. (NYSE: C).
• Broadcom Corp. (NASDAQ: BRCM) Q1 profit soared, and it raised its guidance.
• Cymer Inc. (NASDAQ: CYMI) beat Q1 estimates and announced a share million buyback program.
• Electronic Data Systems Inc. (NYSE: EDS) posted Q1 profits on cost cutting and new contracts.
• EMC Corp. (NYSE: EMC) Q1 earnings fell on on acquisition-related charges.
• Hexcel Corp. (NYSE: HXL) beat Q1 estimates on increased commercial aerospace sales.
• Huaneng Power ADS (NYSE: HNP) earnings plunged on coal prices, but the stock went higher.
• Level 3 Communications Inc. (NASDAQ: LVLT) narrowed its loss on higher sales of networking services.
• McAfee Inc. (NYSE: MFE) Q1 profit plunged on product development and marketing costs.
• MEMC Electronic Materials Inc. (NYSE: WFR) missed analysts' estimates for the first quarter.
• Microsoft Corp. (NASDAQ: MSFT) beat earnings expectations and raised its full-year guidance.
• Netflix Inc. (NASDAQ: NFLX) profit soared in the first quarter on increase in subscriptions.
• Nintendo Co. (OTC: NTDOY) posted record results due to the popularity of the Wii system.

MOST NOTEWORTHY: RF Micro Devices, QLT Inc and Everest RE Group were today's noteworthy upgrades:

• Jefferies upgraded RF Micro (NASDAQ:RFMD) to Buy from Hold citing strong proprietary Asian channel checks. The firm believes RF Micro is past the worst of the inventory handset correction in Asia and that the MPG business is also recovering.
  
• RBC Capital said QLT Inc's (NASDAQ:QLTI) risk/reward has improved and expects divestment announcements to start in late Q2. The firm raised shares to Outperform from Sector Perform.
  
• Citigroup upgraded Everest RE (NYSE:RE) to Buy from Hold citing valuation, likely buybacks, the low risk of asbestos charges and the seasonal trade ahead.

OTHER UPGRADES:

• Merriman raised Level 3 Comm (NASDAQ:LVLT) to Neutral from Sell.
  
• Zions Bancorp (NASDAQ:ZION) was upgraded to Outperform from Neutral at Baird.
  
• True Religion (NASDAQ:TRLG) was raised at Morgan Keegan to Outperform from Market Perform.

Way back in early March I highlighted 10 horrifically downtrending stocks and said not to even think about buying them until they broke their nasty trendlines to the upside.

Over the past few weeks, many have displayed solid sideways price action, but it wasn't until yesterday that the high volume breakouts occurred. I'm talking about those 50+ million shares traded, 10%+ price surges beautifully accomplished by such popular names like Sprint Nextel Corp (NYSE: S), Broadcom Corp (NASDAQ: BRCM) and Level 3 Communications Inc (NASDAQ: LVLT).

Unsurprisingly, several other stocks also showed similarly strong price action:

RF Microdevices Inc (NASDAQ: RFMD)
Anadigics Inc (NASDAQ: ANAD)
Skyworks Solutions Inc (NASDAQ: SWKS)
Triquint Semiconductor Inc (NASDAQ: TQNT)
China Life Insurance Co. Ltd (NYSE: LFC)
Raymond James Financial Inc (NYSE: RJF)
Cerner Corp (NASDAQ: CERN)