Analyst upgrades:

• Jefferies upgraded SAP (NYSE: SAP) to Buy from Hold on expectations license declines will trough in Q2 and margins will expand going forward due to cost control and price increases. The firm has a $46 price target on shares.
• BofA/Merrill upgraded STMicroelectronics (NYSE: STM) to Buy from Underperform on expectations the company will benefit from improving industry fundamentals in 2010.
• Citigroup upgraded Freeport McMoRan (NYSE: FCX) to Buy from Hold to reflect the firm's positive copper outlook, as well as valuation following the recent pullback in shares. The firm has a $58 price target on the stock.
• Phototronics (NASDAQ: PLAB) was upgraded to Buy from Neutral at UBS.
• Anglo American (NASDAQ: AAUK) was raised to Hold from Sell at RBS.
• Peabody Energy (NASDAQ: BTU) was upgraded to Buy from Neutral at Goldman.

Analyst upgrades:

• Keefe Bruyette upgraded KeyCorp (NYSE: KEY) to Outperform from Market Perform due to valuation and the company's capital position. The firm has an $8 target price on the stock.
• BofA/Merrill upgraded its view of the semiconductor sector and upgraded Intel (NASDAQ: INTC) and Marvell Technology (NASDAQ: MRVL) to Buy from Neutral, LSI Corp. (NYSE: LSI) to Buy from Underperform, and Maxim (NASDAQ: MXIM) and National Semiconductor (NYSE: NSM) to Neutral from Underperform. The firm now sees 2010 revenue growth of 21% vs. its prior estimate of 14% due to improving electric demand and lean inventories.
• Thomas Weisel upgraded Vital Images (NASDAQ: VTAL) to Overweight from Market Weight based on compelling valuation and potential upside from its new ViTAL Enterprise product offering.
• Jones Apparel (NYSE: JNY) was upgraded to Buy from Neutral at Goldman.
• Hess Corp. (NYSE: HES) was upgraded to Overweight from Equal Weight at Barclays.
• Nationwide Health (NYSE: NHP) was upgraded to Outperform from Market Perform at Morgan Keegan.

MOST NOTEWORTHY: Intermec, Brasil Telecom and W-H Energy Services were today's most noteworthy upgrades:

• Intermec (NYSE: IN) was upgraded to Hold from Sell at Standford Financial Group. After Intermec's stock fell 10.5% since April 1, and 5.1% on Friday, Stanford believes most of the bad news is priced into the stock.
  
• Brasil Telecom (NYSE: BRP) was upgraded to Buy from Hold at Deutsche Bank and raised their target to $90 from $87 as they believe the recent weakness presents a good buying opportunity.
  
• W-H Energy Services (NYSE: WHQ) was upgraded to Buy from Hold at Deutsche Bank following the Q1 miss as they believe the company is well positioned to benefit from a pickup in U.S. onshore activity and a significant acceleration in international and deep water work.

OTHER UPGRADES:

• Commercial Vehicle Group (NASDAQ: CVGI) was upgraded to Overweight from Neutral at J.P. Morgan.
  
• MoneyGram (NYSE: MGI) was upgraded to Buy from Add at Calyon Securities based on valuation.

MoneyGram International (NYSE: MGI) -- Euronet Worldwide (NASDAQ: EEFT) made an unsolicited offer to buy MGI, a global payment services company, for 0.6179 Euronet common share for each share of MGI. Based on the closing price of Euronet shares on December 4, the offer is valued at approximately $1.65 billion or $20 per MGI share. MGI over all option implied volatility of 73 is above its 26-week average of 50 according to Track Data, suggesting larger price risks.

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

Stock futures were significantly lower this morning, indicating a possible similar open for U.S. stocks as investors' doubt and skepticism over the effectiveness of the Federal Reserve (and other central banks) global plan aimed at fighting the credit crisis. Today, Wall Street will also eye retail sales and wholesale prices, as well as await earnings from Lehman Brothers.

Yesterday, U.S. stocks closed higher after the Federal Reserve and other central banks outlined a global plan to pump more liquidity into the banking system. However, as the day progressed, doubts about how well the plan will succeed grew. While most agree it will aid in addressing the liquidity issue, it is questionable whether it could and would avert the economic slump most economists are calling. A big surge in oil prices also tempered gains and the the Dow industrials finished 41 points higher, or 0.31, the Nasdaq Composite rose 18 points, or 0.71%, and the S&P 500 added nearly 9 points, or 0.61%.

Several economic indicators are scheduled for this morning, potentially swaying the direction stocks would take:

• At 8:30 a.m. EST, November retail sales will be released. Economists expect a 0.6% increase after a 0.2% rise the month before. The increase is attributable to discounts and wage gains that helped balance near-record fuel costs.
• Also at 8:30 a.m., producer price index will be reported. This indicator of inflation at the wholesale level is expected to have risen 1.5% in November after a 0.1% gain in October. Core-PPI, which excludes the volatile food and energy prices, is expected to rise 0.2% in November after no gain the month before.
• Weekly initial jobless claims are also due at 8:30.
• Finally, at 10:00 a.m., business inventories for October will be reported.

MOST NOTEWORTHY: The ocean shippers sector, Tesoro, Siemens AG and MGI Pharma were today's noteworthy upgrades:

• Bear Stears upgraded the ocean shippers sector to Market Weight from Market Underweight, citing higher day rates in the dry bulk market. The firm sees potential upside for dry bulk firms Eagle Bulk Shipping (NASDAQ: EGLE), Quintana Maritime Limited (NASDAQ: QMAR) and Ultrapetrol Ltd (NASDAQ: ULTR).
  
• Bernstein raised shares of Tesoro Corporation (NYSE: TSO) to Outperform from Market Perform and expects a rebound in West Coast refining margins.
  
• ING upgraded shares of Siemens AG (NYSE: SI) to Buy from Hold on valuation and the possibility the company may exit businesses.
  
• MGI Pharma (NASDAQ: MOGN) was upgraded at JP Morgan to Overweight from Neutral, citing expectations for a strong Q3, Aloxi re-acceleration, Dacogen growth, and Auqavan opportunity.

OTHER UPGRADES:

• UBS upgraded shares of Agnico-Eagle (NYSE: AEM) to Buy from Neutral.
  
• Banc of America upgraded Everest RE Group (NYSE: RE) and PartnerRe (NYSE: PRE) to Buy from Neutral.
  
• Calamos Asset Management (NASDAQ: CLMS) was upgraded to Neutral from Sell at Goldman Sachs.

MOST NOTEWORTHY: MoneyGram (MGI), F5 Networks (FFIV), ARK Restaurants (ARKR), Nara Bancorp (NARA) and St. Jude Medical (STJ) were today's noteworthy initiations:

• AG Edwards initiated MoneyGram (NYSE: MGI) with a Buy rating because it believes the recent pullback in the shares provides an attractive entry point; Stephens started shares of MoneyGram with an Overweight rating, and believes the company is well positioned to create strong transactional growth and take market share.

• CIBC expects F5 Networks (NASDAQ: FFIV) to benefit from strong fundamentals in application networking solutions and started shares with a Sector Outperformer rating and $85 target.

• Morgan Joseph initiated ARK Restaurants (NASDAQ: ARKR) with a Buy rating and $43 target; they believe ARK is well positioned to benefit from strong SSS & earnings leverage given its strong store locations, wide ranging price points, and stable unit development pipeline.

• Sandler is positive on Nara Bancorp (NASDAQ: NARA), starting shares with a Buy rating and $17 target, based on the company's long-term prospects.

• ThinkEquity believes St. Jude Medical (NYSE: STJ) is poised to take market share in the ICD markets and started shares with a Buy rating and $56 target...

OTHER INITIATIONS:

• JP Morgan initiated Softbank (OTC: SFTBF) with an Underweight rating and Nippon Telegraph & Telephone (NYSE: NTT) with a Neutral rating.

• Goldman reinstated Bausch & Lomb (NYSE: BOL) with a Neutral rating.

• Banc of America initiated PharMerica (NYSE: PMC) with a Buy rating and $18 target.

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