MOST NOTEWORTHY: Centene, Brinker International, Harmonic, Idex and Royal Dutch Shell were today's noteworthy upgrades:

• Jefferies upgraded shares of Centene Corporation (NYSE: CNC) to Buy from Hold as they expect the company is benefiting from above 20% revenue growth next year and SG&A leverage opportunity over the next 12–18 months.
  
• Bear Stearns upgraded shares of Brinker International (NYSE: EAT) to Outperform from Peer Perform as they believe Brinker's turnaround efforts can enhance shareholder value.
  
• Friedman Billings raised shares of Harmonic (NASDAQ: HLIT) to Outperform from Market Perform based on the favorable outlook for cable and satellite spending on HD video and other projects.
  
• The firm also upgraded Idex Corporation (NYSE: IEX) to Outperform from Market Perform, citing the company's positive 2008 outlook and solid end markets.
  
• Goldman upgraded Royal Dutch Shell (NYSE: RDS.A) to Neutral from Sell on valuation.

OTHER UPGRADES:

• CIBC upgraded J. Crew Group (NYSE: JCG) to Sector Outperformer from Sector Performer and Parker Hannifin (NYSE: PH) to Sector Performer from Sector Underperformer.
  
• Sprint Nextel Corporation (NYSE: S) was upgraded to Outperform from Neutral at Credit Suisse.
  
• RBC Capital Markets upgraded LaSalle Hotel Properties (NYSE: LHO) to Top Pick from Outperform.

MAJOR PAPERS:

• Barron's Online's (subscription required) "Weekday Trader" called Nucor Corporation (NYSE: NUE), a low-cost steel producer with a 4.7% dividend, a stock worthy of consideration.
• Royal Dutch Shell (NYSE: RDS.A) and PetroChina Company Limited (NYSE: PTR) have signed a provisional agreement for Shell to sell liquefied natural gas to PetroChina, reported the Wall Street Journal (subscription required).
  
• The Financial Times (subscription required) reported that Renaissance Technologies and DE Shaw, two of the biggest quantitative hedge fund managers, are raising money, despite concerns over the poor performance of many computer-driven funds last month.

OTHER PAPERS:

• According to the New York Times, Ventana Medical Systems Inc (NASDAQ: VMSI), which makes cancer diagnostic equipment, is expected to announce today that it will acquire Spring Bioscience for $28.9M in cash.
• The New York Post reported that General Electric Company (NYSE: GE) CEO Jeffrey Immelt is planning on bringing Beth Comstock back as GE's chief marketing officer, according to sources close to Immelt.

MOST NOTEWORTHY: Kelly Services, Iron Mountain, Covenant Transportation and the biotech sector were today's noteworthy upgrades:

• Merrill Lynch upgraded Kelly Services Inc (NASDAQ: KELYA) to Neutral from Sell and Iron Mountain Incorporated (NYSE: IRM) to Buy from Neutral after they adjusted estimates in the group to reflect risks of a recession in the U.S.
  
• AG Edwards upgraded shares of Covenant Transportation Group (NASDAQ: CVTI) to Buy from Hold as they believe the stock is oversold after the company was able to renegotiate its debt covenants without significant cost increases.
• Bernstein upgraded the biotech sector citing valuation and typical seasonality for the group. The firm reiterated shares of Amgen Inc (NASDAQ: AMGN), Genentech Inc (NYSE: DNA), Gilead Sciences Inc (NASDAQ: GILD), Celgene Corporation (NASDAQ: CELG) and Vertex Pharmaceuticals (NASDAQ: VRTX) with Outperform ratings...

OTHER UPGRADES:

• Netflix Inc (NASDAQ: NFLX) was upgraded to Hold from Sell at Wedbush. The firm also upgraded shares of Kenexa Corporation (NASDAQ: KNXA) to Buy from Hold.
  
• Deutsche Bank upgraded shares of United Microelectronics (NYSE: UMC) to Buy from Hold.
  
• UBS upgraded shares of Royal Dutch Shell (NYSE: RDS.A) to Buy from Neutral on valuation.
  
• Lehman Brothers upped regulated utilities to Neutral from Negative, and Public Service Enterprise Group (NYSE: PEG) and Wisconsin Energy Corporation (NYSE: WEC) to Overweight from Equal Weight.

MAJOR PAPERS:

• Home Depot Inc's (NYSE: HD) second quarter income drop of 15% may affect what will happen with the company's share buyback that is in part tied to the sale of its HD Supply wholesale business, reported the Wall Street Journal.
• Royal Dutch Shell (NYSE: RDS.A) may sell its 50% stake in BEB Transport & Speicher Service, a German natural gas pipeline firm, reported the Wall Street Journal.
• New Gap Inc (NYSE: GPS) CEO Glenn Murphy bought 150K shares of Gap stock for $2.3M Friday at an average price of $15.55, according to a Monday filing the SEC, reported Barron's Online's "Inside Scoop" column.
• The Financial Times reported that share prices and currencies in the Asia-Pacific region tumbled earlier today, as investors worried about the subprime mess pulled back from emerging markets.

OTHER PAPERS:

• Sony Corporation (NYSE: SNE) will announce plans to float its highly profitable financial services division, Sony Financial Holdings, in what could be Japan's biggest initial public offering this year, creating a company with a market value close to 1T yen, reported the U.K. Times.

In what is sure to be only the latest event in a long case of protracted legal wrangling, a San Francisco federal appeals court has ordered Royal Dutch Shell Plc's (NYSE: RDS.A) vessels to stop all operations in the Beaufort and Chuckchi Seas. Environmental groups and Eskimo villages are seeking greater research into the effect drilling will have on marine wildlife in the region, and the judge agreed to give them time.

Shell isn't too happy. The company claims to have spent $200 million on the project already, including extensive research on the effect drilling will have on the environment, and has also formulated a plan to deal with oil spills. Of course, it's easy to be skeptical of an oil company's studies on environmental impact.

The Department of the Interior has supported drilling but, given the recent scandals involving global warming and political pressure on scientists, the department is not as high on credibility as it once was.

Given the amount of time it will take for any oil from the region to be brought to market, and the relatively small amount that is thought to be feasible for drilling, this probably won't have a material impact on energy prices anytime soon.

Fortune released this year's Global 500 list today, and this years top 10 list is loaded with oil producers. This year's #1 slot goes to Wal-Mart Stores, Inc. (NYSE: WMT) but after that we see a whole slew of big oil names hitting the list.

Following closely on the heels of Wal-Mart comes the world's largest oil company, Exxon Mobil Corp. (NYSE: XOM) who briefly unseated Wal-Mart as the perennial top spot winner last year. Exxon Mobil came up just a little bit shy this year of the top sport and allowed Wal-Mart to get back on top for the fifth time in the last six years. Wal-Mart claimed the top spot this year with $351.1 billion which was slightly higher than Exxon's $347.2 billion.

Even though Exxon was unable to claim the top spot again for the largest company, it does get to boast being the most profitable company in the world, with revenues profits last year of $39.5 billion compared to Wal-Marts revenues profit of $11.2 billion.

After Exxon on the list we see a whole slew of oil companies dominating the top spots. Other oil players ranking in the top ten are:

Royal Dutch Shell(NYSE:RDS) volatility flat as BP is mentioned as M&A partner. RDS is recently up .56 to $83.95. The Daily Mail is reporting that BP and RDS are in merger talks. RDS over all option implied volatility of 17 is near its 26-week average according to Track Data, suggesting non-directional risk.

Dendreon(NASDAQ:DNDN) implied volatility & volume at low end of range last two days. DNDN, a biotechnology company focused on discovery, development and commercialization of therapeutics to fight cancer, is recently trading up .73 to $7.99. DNDN over all option implied volatility of 57 is below its 26-week average of 111 according to Track Data, suggesting decreasing risk.

Option volume leaders today are: Research in Motion (NASDAQ:RIMM), Apple Computer (NASDAQ:AAPL) and Baidu (NASDAQ:BIDU).

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

MOST NOTEWORTHY: Royal Dutch Shell PLC (NYSE: RDS.A), Broadcom Corporation (NASDAQ: BRCM) and National Semiconductor Corporation (NYSE: NSM) were today's noteworthy upgrades:

• Royal Dutch Shell was upgraded to Buy from Neutral at Merrill Lynch to reflect the company's strong refining backdrop and potential for positive surprise in the gas and power and downstream segments.
• Broadcom was upgraded to Market Outperform from Market Perform at JMP Securities following positive channel checks and the recent court win over Qualcomm Incorporated (NASDAQ: QCOM).
• UBS upgraded shares of National Semiconductor to Buy from Neutral on the Q4 upside, ongoing share buyback and guidance which calls for further margin improvement.

OTHER UPGRADES:

• Banc of America upgraded shares of Qwest Communications International Inc (NYSE: Q) to Buy from Neutral to reflect greater visibility into cash flow generation potential through 2008.
• Banc of America also upgraded Cincinnati Bell Inc (NYSE: CBB) to Neutral from Sell, as they believe the stock is not a sell in a market focused on cash flow.
• Genentech Inc (NYSE: DNA) was upgraded at Deutsche Bank to Buy from Hold based on compelling valuation and fundamental outlook.
• Bear Stearns upgraded shares of Nordstrom Inc (NYSE: JWN) to Outperform from Peer Perform citing the recent share pullback and top-line growth.

MAJOR PAPERS:

• According to people familiar with the matter, at least three groups of private-equity companies have formed to attempt to purchase wireless carrier Alltel Corporation (NYSE: AT), reported the Wall Street Journal (subscription required).
• The Wall Street Journal's "Heard in Asia" column reported that in order for Sony Corporation's (NYSE: SNE) stock to rise when it reports next week, it is going to have to convince investors that its PlayStation unit is showing improvement.
• The Financial Times (subscription required) reported that almost half of the senior management at Citigroup Inc's (NYSE: C) consumer operations have quit in the last 18 months, as criticism of CEO Chuck Prince has grown.

OTHER PAPERS:

• According to the Telegraph, Royal Dutch Shell (NYSE: RDS.A) and BP plc ADS's (NYSE: BP) Russian joint venture, TNK-BP, are expected to join the auction for the 537-petrol station network belonging to Yukos. The bidding is expected to start at GBP150M.
• GlaxoSmithKline plc ADR (NYSE: GSK) has begun to promote Alli, the first weight-loss drug to be approved by the FDA for over-the-counter sale, reported the New York Times.

WEBSITES:

• According to DigiTimes.com, citing industry insiders, Taiwan Semiconductor Manufacturing Company (NYSE: TSM) is looking to up production of Intel Corporation's (NADSAQ: INTC) 802.11n Wi-Fi chips at 0.13-micron in Q3, a sign of closer collaboration between the two companies.

MAJOR PAPERS:

• The Wall Street Journal (subscription required)
• Google (NASDAQ: GOOG) may be in talks to acquire the in-game advertising company AdScape Media.
• Home Depot (NYSE: HD) directors are expected to meet with activist investor Ralph Whitworth, who wants the company to spin-off its lower margin supply business to better concentrate on its main stores.
• Sun Microsystems (NASDAQ: SUNW) is expected to announce an agreement with Intel (NASDAQ: INTC) that would involve Sun buying Intel chips for its server systems.
• Barron's Magazine (subscription required)
• Shares of Under Armour (NASDAQ: UARM) may be set to take a tumble and some only believe shares should be trading no higher than $40.
• Shares of Alcoa (NYSE: AA) may be set for another run and John Buckingham of Al Frank Asset Management would buy shares up to $32.41.
• The "Technology Trader" says it may be too early to walk away from shares of Cisco (NASDAQ: CSCO).
• The Financial Times (subscription required) reported that a private equity consortium may be after Dow Chemical (NYSE: DOW).

OTHER PAPERS:

• The U.K. Times reported that Tata Steel and CSN are both expected to raise their bid for Corus (NYSE: CGA).
  
• The Telegraph reported that BP's (NYSE: BP) exiting CEO Browne, dreamed of merging with Shell (NYSE: RDS.A).

Crude oil, which has declined about 15% since mid-December 2006 -- from $65 / bbl. to about $55 / bbl -- shows signs of declining further, but analysts indicate it's too soon to tell if there has been a major change from an oil bull market to a bear market.

For more than three years the price of oil has increased, driven primarily by surging demand in Asia (primarily China), solid demand in the Western hemisphere, gasoline refinery constraints in the U.S., and geopolitical concerns (Iraq War, Nigeria's civil conflict).

The above factors, combined with oil producers' inability to bring new supply on-line quickly, produced an alarming bullish scenario of steadily rising distillate and gasoline prices, and the specter of $100 / bbl oil.

However, as noted, oil has recently sold-off sharply, and drifted toward key support levels at $55. Is the oil bull market over? Tom Bentz, oil broker with BNP Paribas, told Bloomberg News that "Traders have made the decision that no matter what type of winter we have, it's too little, too late" because inventories are high enough to get through the rest of the season."