MOST NOTEWORTHY: The U.S. banking sector, HSBC Holdings, Trans World and Mips Technologies were today's noteworthy downgrades:
CIBC downgraded the U.S. Banks sector to Underweight from Market Weight as they see another leg down as investors shift focus away from write-downs to the impact the write-downs will have on risk-weighted assets and capital ratios.
Morgan Stanley downgraded shares of HSBC Holdings Plc (NYSE: HBC) to Equal Weight from Underweight, as they believe the company may have to set aside more money for bad loans in the U.S.
B. Riley downgraded shares of Trans World Entertainment Corporation (NASDAQ: TWMC) to Neutral from Buy, as they believe the downside risk should the Bob Higgins acquisition proposal fall through outweighs the potential upside should the bid be raised or should another bidder emerge.
B. Riley also downgraded Mips Technologies Inc(NASDAQ: MIPS) to Neutral from Buy following the company's Q1 results to reflect the company's deteriorating balance sheet and licensing business softness.
MOST NOTEWORTHY: Dow Chemical (DOW), Smart Modular (SMOD), Wolverine World Wide (WWW), Win-Dixie Stores (WINN) and Blue Nile (BLUE) were today's noteworthy initiations:
UBS is positive on the ethylene cycle over the next two years and believes Dow Chemical (NYSE: DOW) can beat 2008 consensus estimates, initiating shares with a Buy rating.
JMP Securities started Smart Modular (NASDAQ: SMOD) with a Strong Buy as a unit volume growth theme without much dependence on commodity memory chip pricing.
Citigroup expects further upside given Wolverine World Wide's (NYSE: WWW) strong portfolio of brands, further growth opportunities through line extensions and international growth. The firm started Wolverine World Wide with a Buy rating and $33 target.
Winn-Dixie Stores (NASDAQ: WINN) was started with a Market Perform rating, citing low levels of profitability and unproven ability to drive sustainable profitable sales.
American Technology believes the valuation of Blue Nile (NASDAQ: NILE) leaves little room for upside, despite a highly attractive business model and strong fundamentals, and started shares with a Sell rating and $45 target...
MOST NOTEWORTHY: UnitedHealth Group Inc (UNH), Aetna Inc (AET), Hercules Inc (HPC) and Alcatel-Lucent (ALU), were today's noteworthy initiations:
Jefferies started UnitedHealth Group inc NYSE: UNH) with a Hold rating and $48 target and said near-term risk is still present due to unfavorable reserve adjustments to the company's commercial risk business and high expectations for improvement in the company's commercial medical care ratio.
Aetna Inc (NYSE: AET) was also initiated by Jefferies with a Hold rating based on valuation.
Credit Suisse started Hercules Inc (NYSE: HPC) with an Outperform rating and $24 target.
Matrix USA initiated Alcatel-Lucent (NYSE: ALU) with a Hold rating on valuation...
OTHER INITIATIONS:
Cowen is positive on MIPS Technologies, Inc (NASDAQ: MIPS), starting the company with an Outperform rating, and expects a deal with Microchip Technology Inc (MCHP) to be announced soon.
JP Morgan initiated shares of Headwaters Inc (NYSE: HW) with a Neutral rating.
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MOST NOTEWORTHY: The U.S. banking sector, HSBC Holdings, Trans World and Mips Technologies were today's noteworthy downgrades: 
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