Analyst upgrades:

• Keefe Bruyette upgraded American Express (NYSE: AXP) to Outperform from Market Perform to reflect improving credit trends following the July monthly data. The firm raised its target price on shares to $37.
• Oppenheimer upgraded Corning (NYSE: GLW) to Outperform from Perform as it believes 2010 estimates are achievable and concerns over falling LCD demand are overdone. The firm set a $19 price target on the stock.
• JPMorgan upgraded International Game Technology (NYSE: IGT) to Overweight from Neutral on valuation and expectations domestic replacement orders will pick up. The firm has a $23 price target on shares.
• Goldman Sachs (NYSE: GS) was raised to Buy from Neutral at Pali Capital.
• Portland General Electric (NYSE: POR) was upgraded to Buy from Neutral at Goldman.
• Mechel Steel (NYSE: MTL) was upgraded to Neutral from Reduce at Nomura.

Analyst upgrades:

• Citigroup upgraded Adtran (NASDAQ: ADTN) to Buy from Hold on expectations the company will benefit from the broadband Stimulus funds.
• Morgan Stanley upgraded Continental Airlines (NYSE: CAL) to Overweight from Equal Weight based on relative valuation and views the company as a "survivor." Additionally, the analyst lowered 2009 industry estimates but believes it is the last cut for the year and is incrementally more positive on the sector.
• Morgan Stanley also upgraded EXFO Electro-Optical (NASDAQ: EXFO) to Overweight from Market Weight based on valuation.
• Tata Motors (NYSE: TTM) was upgraded to Buy from Hold at Deutsche Bank.
• Ascent Solar (NASDAQ: ASTI) was upgraded to Neutral from Underweight at JP Morgan.
• Mechel Steel (NYSE: MTL) was upgraded to Neutral from Underperform at Credit Suisse.

Analyst upgrades:

• Morgan Stanley upgraded CNOOC Ltd (NYSE: CEO) to Equal Weight from Underweight to reflect higher crude oil price estimates.
  
• Goldman upgraded VMware (NYSE: VMW) to Conviction Buy from Neutral and raised its target to $29 from $27 following positive checks that indicate strong business actively. The analyst expects VMW's revenue growth to be up 9% in 2009 vs. expectations for overall IT spending to be down.
  
• UBS upgraded ON Semiconductor (NASDAQ: ONNN) to Buy from Neutral and raised its target to $5 from $3.80 based on positive Asia checks that indicate an improving demand outlook and that the company could beat near-term expectations.
• Vodafone (NYSE: VOD) was lifted to Buy from Neutral at Goldman and to Overweight from Equal Weight at Morgan Stanley.
  
• Ashland (NYSE: ASH) was raised to Overweight from Neutral at JP Morgan.

I am the Global Editor at MoneyShow.com and each week I interview an investing expert. This week, I spoke with John Connor, manager of the Third Millennium Russia Fund, who thinks Russia will come back, but not until confidence is restored in the global markets.

Q. John, besides rapidly falling oil prices, what do you see as the primary factors that caused the more than 72% decline in Russian stocks in 2008?

A. Aside from a general flight to quality from emerging markets into the US dollar, the Russians had a couple of things that made it worse: Putin is tired and cranky and should retire, making mistakes with Mechel Steel (NYSE: MTL), [putting] unfair pressure on BP (NYSE: BP), and of course, his overreaction with Georgia. The Georgians started the conflict and if Russia had any public relations sense, the country would have been out in front, telling its side of the story, including its peacekeeping role since the 1990s. Instead, investors bought Georgia's PR, causing them to dump Russian equities, including great companies like Lukoil (Frankfurt: LUK.F), which is now trading at a little more than three times earnings.

Nucor (NYSE: NUE), an operator steel mills and marketer of steel products, closed at $32.27 Tuesday. NUE December option implied volatility of 91 is above its 26-week average of 73 according to Track Data, suggesting larger price movement.

AK Steel (NYSE: AKS), a producer of steel products, closed at $6.86 Tuesday. AKS December 7.5 straddle is priced at $2.40, January 7.5 straddle is priced at $3.50. AKS January option implied volatility of 158 is above its 26-week average of 102 according to Track Data, indicating larger price movement.

Mechel Steel (NYSE: MTL) closed at $4.59 Tuesday. MTL is a Russian mining, steel and power company. MTL December 5 straddle closed at $2.25, January 5 straddle closed at $3.15. MTL April option implied volatility of 185 is above its 26-week average of 117 according to Track Data, suggesting larger price fluctuations.

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

Analyst upgrades:

• UBS upgraded McDonald's (NYSE:MCD) to Buy from Neutral based on expectations the it can deliver on 2009 EPS expectations and potential for accelerating share gains.
  
• Bernstein upgraded Nokia (NYSE:NOK) to Outperform from Underperform on valuation following the company's profit warning. Merrill upgraded shares to Buy from Neutral to reflect valuation and Nokia's new product portfolio. Shares were also upgraded to Hold from Sell at WestLB.
  
• B. Riley raised UCBH Holdings (NASDAQ:UCBH) to Buy from Neutral to reflect the improved valuation and the company's stronger capital position provided by the US Treasury investment.
• Parexel (NASDAQ:PRXL) was upgraded to Buy from Hold at Jefferies.
  
• CTS Corp (NYSE:CTS) was lifted to Neutral from Underweight at JP Morgan.
  
• Hospitality Properties (NYSE:HPT) was upgraded to Equal Weight from Underweight at Morgan Stanley.

Analyst downgrades:

• Soleil downgraded Disney (NYSE:DIS) to Hold from Buy to reflect the weakening macro-economic outlook and their belief consensus estimates may be too high. The firm lowered their target to $23 from $40.
  
• Merrill downgraded Dell (NASDAQ:DELL) to Neutral from Buy on expectations PC sales will decline next year amid the slowing economy. The firm lowered Dell's target price to $13 from $22.
  
• Jefferies cut MDS Inc (NASDAQ:MDZ) to Hold from Buy to reflect slowing demand and a lack of catalysts to unlock the company's assets. The firm lowered their target to $10.50 from $15.
• Alcoa (NYSE:AA) was lowered to Neutral from Buy at UBS.
• Tesco PLC (Other OTC:TSCDY) was downgraded at JP Morgan to Underweight from Neutral.
  
• Merrill downgraded SAP AG (NYSE:SAP) to Neutral from Buy.
  
• Goldman added Altera (NASDAQ:ALTR) to the Conviction Sell List.

Analyst initiations:

• Citigroup thinks AutoZone (NYSE:AZO) will benefit from the slowdown in car sales and thinks the recent pullback is overdone. Shares were initiated with a Buy rating and $146 target.
• Citigroup also believes Advance Auto Parts (NYSE:AAP) will benefit from the slowdown in car sales and started shares with a Buy rating and $35 target.
  
• After Sunway (OTCBB:SUWG) reported higher than expected revenue, Roth Capital thinks the company is poised for substantial growth, but the firm thinks its remaining warrants may keep the shares trading at a modest valuation for a significant amount of time. The firm started shares with a Hold rating and $3.60 target.
• Mechel Steel (NYSE:MTL) was initiated with a Neutral rating at Merrill Lynch.
  
• China Life Insurance (NYSE:LFC) was assumed with a Buy rating at UBS.
  
• Gap (NYSE:GPS) was started at Cowen with a Neutral rating.

Arcelor Mittal (NYSE: MT), a global steel producer, is recently trading at $26.90 in pre-open trading, below its close of $31.70. MT reported Q3 EPS of $2.79 verses consensus of $4.01. MT December option implied volatility of 94 is above its 26-week average of 54 according to Track Data, suggesting larger price movement.

Mechel Steel (NYSE: MTL) closed at $9.01 Tuesday. MTL is a Russian mining, steel and power company. MTL December option implied volatility of 177 is above its 26-week average of 88 according to Track Data, suggesting larger price fluctuations.

US Steel (NYSE: X) is recently trading at $38.75 in pre-open trading, below its close of $41.17. X November option implied volatility of 97 is above its 26-week average of 71 according to Track Data, suggesting larger price movement.

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

Analyst upgrades:

• Societe Generale upgraded shares of Credit Suisse (NYSE: CS) to Buy from Sell as they believe the company is the European investment bank investors should own as sentiment gradually improves.
  
• Societe Generale also raised Deutsche Bank (NYSE: DB) to Hold from Sell as they believe it has managed the credit crisis well and that the government bailout of the GSEs will improve investor sentiment.
  
• Citigroup upgraded shares of Kimberly Clark (NYSE: KMB) to Buy from Hold as they expect the company to benefit from falling materials and energy prices. The firm raised their target to $71 from $60.
• UST Inc (NYSE: UST) was lifted at Morgan Stanley to Equal Weight from Underweight.
  
• Corning (NYSE: GLW) was upgraded to Overweight from Market Weight at Thomas Weisel.

Analyst downgrades:

• Credit Suisse downgraded the U.S. Homebuilders sector to Market Weight from Overweight to reflect deteriorating traffic trends and higher valuations. In addition, the firm cut Toll Brothers (NYSE: TOL), Pulte Homes (NYSE: PHM), D.R. Horton (NYSE: DHI) and KB Home (NYSE: KBH) to Neutral from Outperform.

Crocs (NASDAQ: CROX) is trading at $5.06 late this morning, well below its close of $8.94. CROX lowered Q2 and 2008 financial guidance. Robert Baird Co lowered its rating to Neutral from Outperform. CROX over all option implied volatility of 91 is above its 26-week average of 84 according to Track Data, suggesting larger price movement.

Mechel Steel (NYSE: MTL) closed at $22.84, and is trading up this morning at $26.40. MTL sold off 38% on July 24 after Russian Prime Minister Vladimir Putin ordered antitrust authorities to investigate selling prices at steel and coal group MTL. MTL August option implied volatility is at 162, October is at 105, above its 26-week average of 66 according to Track Data, suggesting larger price fluctuations.

Elan Corp (NYSE: ELN) closed at $32.34 and, as of 11:15 Friday morning, is trading at $33.43. ELN's & WYE's Bapineuzumab (Alzheimer's treatment) Phase 2 trial results will be presented at the International Conference on Alzheimer's Disease on July 29. ELN August option implied volatility is at 97, October is at 70; above its 26-week average of 69 according to Track Data, suggesting larger price fluctuations.

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

"Global steel producers are thriving, and their stocks are hitting new highs," note Yiannis Mostrous and Roger S. Conrad, who add, "But the best is yet to come."

In the industry-leading Personal Finance, the two advisors explain, "We're still in the early stage of a truly global bull market cycle for steel, and the companies best positioned to take advantage are headed a lot higher." Here, they look at their "Iron Five."

"As is the case with other building blocks of economic growth, steel is enjoying explosive demand from the developing world. And with the world expanding as never before, steel companies are literally selling as fast as they can produce.

"In the August 2007, we highlighted five first-rate global steel producers. Since then, they've returned an average of 67.4%, versus a decline of 3.7% for the S&P 500.

"The Iron Five are five picks that we believe are ripe for even bigger gains. Like the last group, these stocks are often volatile. They're also vulnerable to the possibility of a general stock market slide and most of all to a dip in global demand growth, particularly from China.

For 25 years, Steven Halpern, editor of TheStockAdvisors.com, has surveyed the leading financial newsletter advisors asking for their favorite stocks for the coming year. This article is one of 100+ ideas in the Best Stocks for 2008 report.

"Mechel OAO (NYSE: MTL), Russia's second-largest producer of long steel products," is our favorite speculative play for 2008," say co-editors Roger Conrad and Yiannis Mostrous in Vital Resource Investor.

"The company operates one major steel mill with a capacity of close to 5 million tons of output per year. Mechel operates in Russia, Lithuania and other countries in Central and Eastern Europe. Its ace in the hole is a mining business that focuses on raw materials used in making steel, primarily coking coal, iron ore, nickel and steam coal.

"The company's steel business is 100% self-sufficient in coking coal, 80% in iron ore and 50% in electricity. This aspect of Mechel (i.e., vertical integration) is critical in an environment where raw material prices continue to rise. And it should support the stock because its performance this year has been nothing less than dazzling.

"Mechel is a high-cost producer, and management has worked to cut costs while improving efficiency. Those efforts have been quietly successful up to now, and we expect this to be an ongoing positive theme.

"And Russia's strong domestic demand -- within and outside the all-important energy sector -- is an additional advantage for the company. Buy Mechel at current prices."

This article is part of a 20 article special report on "Metals, miners and money".

Among resource plays, international investing expert Nick Vardy says, "Mechel Open Joint Stock Company (NYSE: MTL) is one of Russia's largest mining and metals companies a producing steel, as well as processed coal and metal products used in mining industries.

In his Global Bull Market Alert, the advisor explains, "Mechel's rise from relative obscurity has been rapid. Rising metals prices and industry consolidation have more than quadrupled Mechel's sales from a mere $1 billion in 2001 to $4.4 billion last year.

"In announcing its first half 2007 in October, Mechel confirmed that its breathtaking growth still is on track. Both business segments -- mining and steel -- demonstrated high operational results. Crude steel production was up 4% year-on-year, with rolled products up 11%. Coal output rose 10%, driven by a 29% rise in steam coal output. Nickel output also rose 22%.

"But it was the company's financial results that knocked analysts' socks off. Revenue rose a whopping 55% to $2.99 billion during the first six months of 2007, compared to the same period of 2006. Earnings before interest, taxation, depreciation and amortization (EBITDA) rose 136% to $813.7 million.

MOST NOTEWORTHY: British American Tobacco, Covad Communications, Pacific Capital, Volcom and American Medical Systems were today's noteworthy downgrades:

• Goldman downgraded shares of British American Tobacco (NYSE: BTI) to Neutral from Buy on valuation.
  
• Covad Communications (NYSE: DVW) was lowered to Hold from Buy at Jefferies. The firm downgraded shares after Platinum Equity Holdings agreed to acquire the company.
• Keefe Bruyette downgraded Pacific Capital Bancorp (NASDAQ: PCBC) to Market Perform from Outperform following its Q3 credit loss pre-announcement.
  
• ThinkEquity reduced Volcom (NASDAQ: VLCM) to Accumulate from Buy following its reduced guidance.
  
• American Medical Systems (NASDAQ: AMMD) was downgraded to Market Perform from Outperform at Raymond James and at Piper Jaffray. Piper downgraded shares following the lower-than-expected Q3 results. Shares were also downgraded to Hold from Buy at Stifel following the weak Q3 report.

OTHER DOWNGRADES:

• Citigroup downgraded Mechel OAO (NYSE: MTL) to Hold from Buy.
  
• Hutchison Telecommunications (NYSE: HTX) was downgraded to Neutral from Overweight at JP Morgan.
  
• Las Vegas Sands (NYSE: LVS) was downgraded to Market Perform from Outperform at BMO Capital.
  

AK Steel Holding Corp. (NYSE: AKS), a flat-rolled carbon, stainless and electrical steel producer, is recently up $1.39 to $50.63. The DealReporter said several steel companies are interested in AKS according to sources. AKS is expected to report EPS on October 23. AKS call option volume of 15,243 contracts compares to put volume of 2,502 contracts. AKS October 50 straddle is priced at $3.75. AKS November option implied volatility of 60 is above its 26-week average of 51 according to Track Data, suggesting larger price risks.

Mechel Steel (NYSE: MTL), a Russian mining and metals company, is recently up $6.26 to $72.23 after reporting its operational results for nine months. MTL November option implied volatility of 55 is above its 26-week average of 43 according to Track Data, suggesting larger price risk.

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