The unofficial closing bells put the DJIA up more than 101 points to 12,170.18 (0.84%), the NASDAQ rose more than 32 points (1.2%) to 2,727.49, and the S&P 500 rose 1.17% or more than 14 points to 1,275.93.

There were several analyst upgrades and downgrades today, including Aixtron SE (NASDAQ: AIXG), which we noted in our story on LED lighting this morning and was raised to ‘equal weight’ at Morgan Stanley. Other changes included AstraZeneca PLC (NYSE: AZN) cut to ‘underweight’ at Morgan Stanley; Honeywell International (NYSE: HON) raised to ‘buy’ at Citigroup; Humana Inc. (NYSE: HUM) reiterated as ‘buy’ and target price raised to $95 at Argus; Plains All-America Pipeline L.P. (NYSE: PAA) raised to ‘buy’ at Wells Fargo; and Alcatel-Lucent (NYSE: ALU) cut to ‘neutral’ at BofA/ML.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: Fuel Tech, Inc. (NASDAQ: FTEK) is up about 22%, at $6.63; Iridium Communications Inc. (NASDAQ: IRDM) is up nearly 16%, at $7.34; Exide Technologies (NASDAQ: XIDE) is down more than -32%, at $3.04, after posting a new 52-week low of $2.98 earlier today; WMS Industries Inc. (NYSE: WMS) is down nearly -17%, at $18.25; James River Coal Corp. (NASDAQ: JRCC) is down nearly -9%, at $9.45; and Procera Networks, Inc. (AMEX: PKT) is up nearly 21%, at $14.31, after posting a new 52-week high earlier today of $14.38.

Several other standouts from today are as follows…

Republic Airways Holdings Inc. (NASDAQ: RJET)  is up more than 57%, at $4.24. The company said that it is looking at selling or spinning off its Frontier Airlines unit.

Opexa Therapeutics, Inc. (NASDAQ: OPXA) is up nearly 33%, to $1.37. The company announced that its drug treatment for multiple sclerosis has received the Fast Track designation from the FDA.

Dynegy Inc. (NYSE: DYN) is up more than 28%, at $3.79. The utility company has said that several of its units have filed for bankruptcy. We covered the unusual bankruptcy boost in more detail earlier today.

Targacept, Inc. (NASDAQ: TRGT) is down nearly -59%, at $7.75, a new 52-week low. The company announced this morning that its anti-depressant drug failed a recent first phase trial.

McCormick & Schmick’s Seafood Restaurants Inc. (NASDAQ: MSSR) is up more than 27%, at $8.65. The company has accepted a buyout offer of $8.75/share in cash from Landry’s Inc.

Solazyme, Inc. (NASDAQ: SZYM) is up more than 17%, at $10.98. The company has signed tentative contracts for 90% of its feedstock through 2015. We covered potential upside in the biofuel sector earlier this week.

Stay tuned for Wednesday. Federal Reserve chairman Ben Bernanke is giving a speech in the morning and Federal Reserve governor Daniel Tarullo gives a speech in the afternoon. We have noted the following events (all times Eastern):

• 7:00 a.m. – Mortgage Bankers Association purchase applications
• 9:30 a.m. – Wholesale trade report
• 10:30 p.m. – EIA weekly petroleum status report
• 1:00 p.m. – US Treasury 10-year note auction

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Paul Ausick

What makes this so interesting is that two buyout offers came from The Blackstone Group LP (NYSE: BX) and Carl Icahn’s Icahn Enterprises LP (NYSE: IEP) failed to secure a merger almost a year ago.

The move effectively aims to protect the parent company from shareholders, including Carl Icahn, and appears to be coming at the expense of bondholders.  The company has reached an agreement with holders of more han $1.4 billion in senior notes issued by the Dynegy Holdings subsidiary and it appears to be setting the tone for the restructuring of more than $4 billion of Dynegy Holdings’ obligations. This appears to have no impact on the power generation assets. Where the issues are coming is that Dynegy has restructured and now the parent owns the assets but certain subsidiaries on the hook for the debt in a move obviously meant to protect the parent company in restructuring efforts.

Dynegy shares are up 25% at $3.70 on very active volume and the 52-week trading range is $2.35 to $6.92.

JON C. OGG

Italy’s sovereign debt interest rates rise sharply. (Reuters)

Toyota’s (NYSE: TM) profits fall and it withdraws its full-year forecast. (Reuters)

Greece cannot decide on its new prime minister. (Reuters)

New Census Bureau data shows 49 million people in the U.S. live in poverty. (Reuters)

Barnes & Noble (NYSE: BKS) launches a new version of its NOOK e-reader. (Reuters)

Experts find a bug in Apple’s (NASDAQ: AAPL) app software. (Reuters)

Google’s (NASDAQ: GOOG) chairman says his company will not favor Motorola Mobility (NYSE: MMI) as its develops new software. (Reuters)

Societe Generale’s results hurt by Greece. (WSJ)

Dynegy’s (NYSE: DYN) holding company files for Chapter 11. (WSJ)

Johnson Associates says Wall St. bonuses will drop sharply this year. (WSJ)

Vodafone (NYSE: VOD) lifts its guidance. (WSJ)

The State Department may have improperly handled hearings on a pipeline to run from Canada to the U.S. (WSJ)

A drop in home prices may hurt the consumer economy in China. (WSJ)

Best Buy (NYSE: BBY) will move out of some international markets to focus on the U.S. (WSJ)

Dish Network (NASDAQ: DISH) may move into the internet TV market. (WSJ)

The SEC defends a $285 million settlement with Citigroup (NYSE: C) over fraud charges. (WSJ)

More people use the Walmart (NYSE: WMT) bank as traditional financial firms charge higher fees. (NYT)

The crisis in Europe prompts a tightening of bank lending in the U.S. (FT)

U.S. regulators increase their investigation of MF Global. (FT)

Banks begin to sell sovereign bonds that could make the eurozone crisis worse. (Bloomberg)

Douglas A. McIntyre

After US markets closed yesterday, S&P lowered its rating on Italy’s sovereign debt from ‘A+’ to ‘A’ with a negative outlook. In its report, S&P specified weakening economic growth prospects, its “fragile” government, and policy differences between the Berlusconi government and the parliament.

In what may be any rating agency’s first criticism at a government’s fiscal austerity measures, the ratings agency noted: “More subdued external demand, government austerity measures, and upward pressure on funding costs in both the public and private sectors will, in our opinion, likely result in weaker growth for the Italian economy compared with our May 2011 base-case expectations, when we revised the outlook to negative. We believe the reduced pace of Italy’s economic activity to date will make the government’s revised fiscal targets difficult to achieve.”  In other words, spending cuts by the Italian government are likely to stall the country’s economic growth. Such a situation will make it nearly impossible for the country to meet its new fiscal targets.

Iron Mountain Inc. (NYSE: IRM) received a ‘B+’ rating from S&P on its proposed $300 million senior subordinated notes due in 2019. The agency also placed a ‘BB-’ rating and a negative outlook on Iron Mountain’s corporate credit.

Discover Financial Services (NYSE: DFS) received a ‘AAA’ rating from S&P on Discover Card Execution Note Services $800 million DiscoverSeries notes. These notes are asset-backed securities ultimately collateralized by “receivables generated from designated Discover Card accounts.”

European Aeronautic Defence and Space Co. N.V. (OTC: EADSY), maker of the Airbus aircraft, received an outlook upgrade from ‘stable’ to ‘positive’ from S&P. The agency reaffirmed its ‘A-/A-2′ long- and short-term corporate credit ratings on the company.

Helix Energy Solutions Group, Inc. (NYSE: HLX), an oil field services firm, received a corporate credit rating boost from ‘B’ to ‘B+ from S&P. The rating on the company’s senior secured debt was also raised to ‘BB-’ and unsecured debt was raised from ‘CCC+’ to ‘B-’.

Elizabeth Arden, Inc. (NASDAQ: RDEN) received an upgrade from ‘stable’ to ‘positive’ from S&P. The agency also affirmed its ‘B+’ corporate credit rating.

Yum! Brands Inc. (NYSE: YUM) received a rating of ‘BBB-’ from S&P on a proposed offering of worth 350 million Chinese renminbi (about $55 million) in senior unsecured debt. The notes will rank equally with existing and future unsecured debt.

Monsanto Co. (NYSE:MON) received an ‘A2′ long-term debt and Prime-1 rating from Moody’s on its commercial paper.

Bill Barrett Corp. (NYSE: BBG) received a ‘B1′ rating from Moody’s on a proposed offering of $300 million in secured notes due 2019. Proceeds will be used to repay borrowing on the company’s revolving credit borrowings which funded acquisitions in 2011 and to support capital spending above operating cash flow. The company’s outlook retained a ‘stable’ rating.

Dynegy Inc. (NYSE: DYN) was placed on Rating Watch Negative by Fitch Ratings following the announcement of a $1.25 billion exchange offer. The offer includes debt with interest rates from 7.125% to 8.750%, all of which will be exchanged for new 10% senior secured notes.

AT&T (NYSE: T) was reaffirmed on Rating Watch Negative by Fitch Ratings. The company’s Issuer Default Ratings and senior unsecured debt rating have been rated ‘A’.

Many debt and credit ratings upgrades are noise, but there is one thing that usually rings true.  As companies see their credit ratings rise, that lowers their borrowing costs, and that in effect raises their earnings.  Credit ratings matter more now that America is no longer “AAA.”

Paul Ausick

In the Clorox deal, Icahn would like to initiate a competitive auction for Clorox with potential buyers like Proctor & Gamble Co. (NYSE: PG), Colgate-Palmolive Co. (NYSE: CL), Kimberley-Clark Corp. (NYSE: KMB), and Japanese giant Kao Corp. Clorox’s board has already rejected Icahn’s latest move, a so-called ‘back-stop’ offer which is predicated on Icahn’s success in replacing the 11 current directors. If he manages to do that, and is still unable to find a buyer for Clorox, Icahn will buy the company himself for $78/share in cash and debt. Clorox has not yet scheduled its 2011 annual meeting, putting off the vote Icahn seeks to replace the company’s directors.

Dumping Lions Gate acknowledges that Icahn doesn’t believe the company is worth all the headaches. Icahn has long argued that Lions Gate should get out of the production business and instead focus on distribution of independent films. Lions Gate has lost money in three of the last four quarters, proving Icahn’s point to some degree. The $7/share price that Icahn will take for the shares is approximately what he paid for them.

There are some other weak spots in Icahn’s portfolio. Dynegy Inc. (NYSE: DYN) has been stumbling due to weak natural gas prices. Icahn and Seneca Capital own the company, which is mostly high-priced debt. The problem here is whether or not there is a taker for Dynegy. It’s struggles with debt and low prices will continue.

Another possible dump would be Chesapeake Energy Corp. (NYSE: CHK), and not because the stock is a particularly bad performer. The natural gas giant is just too big, at a market cap of nearly $21 billion, for Icahn to have much influence without making another big purchase of Chesapeake’s stock. The offer for Clorox could also force Icahn to raise some cash, if the deals breaks Icahn’s way.

Icahn also holds about 19% (about 60 million) of outstanding shares in Motorola Mobility Holdings, Inc. (NYSE: MMI), which Google Inc. (NASDAQ: GOOG) has offered to pay $40/share for.

Icahn also owns about 25% of Mentor Graphics Corp. (NASDAQ: MNTR), a relatively small computer software maker with a market cap of just under $2 billion. The company doesn’t look to be on either a growth path or a decline path. Neither is particularly good for Icahn over the short term.

Lions Gate’s shares are down more than -5% in the pre-market this morning, at $7.13, in a 52-week range of $5.69-$7.84. Clorox shares are down fractionally in the pre-market, at $70.50, in a 52-week range of $60.56-$75.44.

Paul Ausick

This is the list of Unusual Suspects to watch in the week ahead: Amazon.com Inc. (NASDAQ: AMZN); American Water Works Company, Inc. (NYSE: AWK); Dynegy Inc. (NYSE: DYN); E*TRADE Financial Corporation (NASDAQ: ETFC); Capital One Financial Corporation (NYSE: COF); First Solar Inc. (NASDAQ: FSLR); Ford Motor Co. (NYSE: F); Genworth Financial Inc. (NYSE: GNW); Mellanox Technologies Ltd. (NASDAQ: MLNX); US Airways Group Inc. (NYSE: LCC); Delta Air Lines Inc. (NYSE: DAL); Brookdale Senior Living Inc. (NYSE: BKD); Five Star Quality Care, Inc. (NYSE: FVE); Kindred Healthcare Inc. (NYSE: KND); Skilled Healthcare Group, Inc. (NYSE: SKH); and Sun Healthcare Group Inc. (NASDAQ: SUNH).

Again, these are intended to be the non-earnings stocks to watch even if some are reporting earnings.  In separate notes, we already published an earnings calendar with more than 20 detailed previews of the top earnings reports for this coming week.  There are also some carry-over issues that investors will want to track in the Top 11 Analyst Calls of the Week that we have for review and preview with matters that have longer-term implications.

Amazon.com Inc. (NASDAQ: AMZN) was given a feature article in Barron’s this weekend titled “It’s All About the Revenues at Amazon” where the financial publication says that it is worth another 25% more than it already is today.  If the market is flat or just not real weak due to Washington D.C. on Monday morning we would expect another gain of 2% or so despite all-time highs having been seen last week.

American Water Works Company, Inc. (NYSE: AWK) is one we have routinely featured as being the best water stock out there.  The water utility giant almost never reaches a 10% pullback from its highs, but on Friday it did breach that 10% threshold barely at $27.63 would mark it and the low was $27.54. Shares closed at $28.00.  The company does have earnings coming up, but that is very rare to get the 10% pullback.  We will not be shocked if the company announces a capital raise on strength.

Dynegy Inc. (NYSE: DYN) was down over 3% in regular trading on Friday, but shares popped more than 5% in the after-hours session to $6.05 on news that a Delaware court rejected PSEG’s attempt to block the company’s restructuring.

E*TRADE Financial Corporation (NASDAQ: ETFC) could have another buyer as Capital One Financial Corporation (NYSE: COF) reportedly had considered making a bid back in 2010.  This report surfaced after the close on Friday.  Our take stands on our “maximum fair market value being $20″ unless a buyer has a way to end the overhang of its ongoing problem loan areas.

First Solar Inc. (NASDAQ: FSLR) may have earnings come up this next week but word surfaced late Friday that it has Cory Steffek to help the company make acquisitions and/or seek out partnerships.  This fits in with our solar mergers expectations in the coming months.

Ford Motor Co. (NYSE: F) was listed in Barron’s this weekend as being “ready to roll” in an artgicle.  Despite having had lower earnings and despite some new UAW labor issues, Barron’s said Ford could top $15 if analysts are right.  While that is another 25% higher, that is actually far less aggressive than the consensus price targets from Thomson Reuters.

Genworth Financial Inc. (NYSE: GNW) rose Friday on word that the company is taking steps for a possible splitting-up of the company and to move to reinstate share buybacks.  If this is the case, then the gains may have much more to go as a candidate for moving away from mortgage guaranty operations.  Keep in mind that the 6% gain to $8.32 on Friday compares to a 52-week range of $7.56 to $14.77.

Mellanox Technologies Ltd. (NASDAQ: MLNX) was noted over the weekend as having large options bets that its gains in cloud computing will keep going.  At $34.85, keep in mind that the Israeli-outfit has a 52-week trading range of $14.60 to $35.60.

Two Tales in Airlines: US Airways Group Inc. (NYSE: LCC) announced late Friday that it was suing its pilot union for illegal job actions for its 5,200 pilots covered in the union.  In another bit of weekend news, Delta Air Lines Inc. (NYSE: DAL) faces some negative press as two of its jets apparently collided on the ground in Chicago.  No injuries were reported, but how organized does that sound?

Woes come to nursing homes… Medicare announced big cuts on Friday afternoon regarding reimbursement and payments to nursing homes as part of what was announced in April to lower overpayments to the nursing home segment.  This created a disaster in many key stocks: Brookdale Senior Living Inc. (NYSE: BKD) was down 6.3% at $20.04; Five Star Quality Care, Inc. (NYSE: FVE) was down 9.5% to $4.48; Kindred Healthcare Inc. (NYSE: KND) was down about 20% to $15.00; Skilled Healthcare Group, Inc. (NYSE: SKH) was down 19% to $7.11; Sun Healthcare Group Inc. (NASDAQ: SUNH) was down 33% at $4.69.

JON C. OGG

Paulson & Co. Inc. had some changes. 

One change Paulson did not make was in the SPDR Gold Trust (NYSE: GLD).  That may have been lightened up since the March 31 date as some rumors indicated, but that 13F filing showed that the March 31 position was called as 31.5 million shares worth some $4.4 billion as of March 31.

Hewlett-Packard Co. (NYSE: HPQ) is a new position of 25 million shares worth just over $1 billion for Paulson.  Transocean Ltd. (NYSE: RIG) was listed 24.5 million shares versus only about 7.2 million shares the previous quarter.

Soros Fund Management LLC cut gold and banks.

SPDR Gold Trust (NYSE: GLD) was slashed down to a mere 49,400 shares worth $6.9 million at the end of March 31, 2011.  If that is not a massive gold exit, what is?

The big bank position cuts came in.  Bank of America Corporation (NYSE: BAC) was slashed down massively to 29,400 shares, as if Soros just didn’t get the sales in before the close on that day.  Soros cut stakes in J.P. Morgan Chase & Co. (NYSE: JPM) and in Wells Fargo & Co. (NYSE: WFC).  JPMorgan was 624,600 shares worth $28.7 million and Wells Fargo was just over 3.5 million shares worth $111.1 million as of March 31.  The exception in banks was a larger stake in Citigroup, Inc. (NYSE: C) listed as 2.938 million shares worth some $129.8 million.  Apple Inc. (NASDAQ: AAPL) was down to 230,433 shares worth $80.3 million for Soros, but there are some 210,000 shares worth of call options and some 280,000 shares worth of Put options listed.  SOme elimination positions that no longer appear are Best Buy Co. Inc. (NYSE: BBY) and Wal-Mart Stores Inc. (NYSE: WMT).

Warren Buffett’s Berkshire Hathaway was the smallest changes ever, mainly because Buffett kept new positions confidential with the SEC. 

Mastercard Inc. (NYSE: MA) was the only new Berkshire Hathaway position and it was too small to even matter for Berkshire Hathaway.

Bruce Berkowitz of Fairholme Captal Management made some key changes.

Berkowitz appears to have trimmed American International Group Inc. (NYSE: AIG) slightly and that is listed as almost 44.2 million shares but there are many warrants listed.  Brookfield Asset Management Inc. (NYSE: BAM) was announced as a new position of 27,500,000 shares worth some $892 million.  Bruce Berkowitz must also be on the move in Cisco Systems Inc. (NASDAQ: CSCO) as he bought more than 35.8 million shares worth some $614 million as of March 31.  Sears Holdings Corporation (NASDAQ: SHLD) was also a gain of about 1.4 million shares to a higher count of more than 16.3 million shares worth some $1.35 billion.

Berkowitz slashed eliminated his entire stake in General Growth Properties (NYSE: GGP).  That had previously been more than 100 million shares worth more than $1.7 billion.  He also eliminated General Electric Co. (NYSE: GE), down from almost 16 million shares previously noted.

Carl Icahn’s changes are not as numerous on the surface and some appear to have been known. 

Dynegy Inc. (NYSE: DYN) was up to more than 14.4 million shares, but that figure may be more now.  Amgen Inc. (NASDAQ: AMGN) appears as a new position with 1.02 million shares worth some $54.5 million shares.  SOuthern Union Co. (NYSE: SUG) was listed as a new position for Icahn as well, but this was only 186,154 shares worth some $5.328 million.

David Einhorn’s Greenlight Capital also made some key Changes.

Greenlight gave a green light to new positions in Best Buy Co. Inc. (NYSE: BBY) at about 6 million shares worth over $172 million and 3.275 million shares of CVS Caremark Corporation (NYSE: CVS) worth more than $110 million.  General Motors Co. (NYSE: GM) was also a new position of more than 3.5 million shares worth more than $100 million.  

 *********

Again, keep in mind that these are just some of the whale watching trades that took place in the first quarter of this year.  There were too many to focus on individually and we wanted to focus on some of the more apparent trades that were in identifiable names for the investing public.

JON C. OGG

Arcelor Mittal (NYSE: MT) Raised to Buy at Goldman Sachs.
BMC Software Inc. (NYSE: BMC) Cut to Hold at Citigroup.
Chimera Investment Corporation (NYSE: CIM) Cut to Market Perform at KBW.
Community Health Systems, Inc. (NYSE: CYH) Cut to Perform at Oppenheimer.
Dynegy Inc. (NYSE: DYN) Reiterated Hold at Argus.
Evergreen Solar Inc. (NASDAQ: ESLR) Cut to Sell at Citigroup.
Everest Re Group, Ltd. (NYSE: RE) named as Bear of the Day at Zacks.
Gap Inc. (NYSE: GPS) Cut to Neutral at BofA/ML; Cut to Sell at Goldman Sachs.
Genuine Parts Company (NYSE: GPC) Reiterated Buy at Argus.
Google Inc. (NASDAQ: GOOG) Maintained Buy but cut estimates at Argus.
Infosys Technologies Limited (NASDAQ: INFY) Cut to Neutral at Credit Suisse;target and estimates cut at HSBC.
J.C. Penney Co., Inc. (NYSE: JCP) named Bull of the Day at Zacks.
J.P. Morgan Chase & Co. (NYSE: JPM) Reiterated Hold at Argus.
Iron Mountain Inc. (NYSE: IRM) Cut to Hold at Citigroup.
KB Home (NYSE: KBH) Raised to Neutral at Credit Suisse.
Kraft Foods Inc. (NYSE: KFT) Cut to Equal-Weight at Morgan Stanley.
Marvell Technology Group Ltd. (NASDAQ: MRVL) Cut to Neutral at Susquehanna.
PG & E Corp. (NYSE: PCG) Raised to Outperform at Credit Suisse.

If you are interested in the top research upgrades and downgrades from last week, those include CYH, GOOG, GTXI, MPEL, KWK, RIG, SLW, RGLD, and THC.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Vincent Intrieri and Samuel Merksamer were nominated by Icahn Associates.   E. Hunter Harrison was nominated by Seneca. Thomas W. Elward is independent. Current Dynegy directors Patricia A. Hammick, David W. Biegler, Victor E. Grijalva, Howard B. Sheppard and William L. Trubeck do not intend to stand for reelection at the Annual Meeting of Stockholders

The nominations would appear to break the spirit if not the letter of the SEC regulation that investors in public companies should not have insider information. Icahn has made a bid for the company. Icahn on Wednesday said he signed an agreement with the company that would allow him to buy up to 19.99999% of the company while retaining his voting rights. That arrangement will have ongoing support from his two directors. So will his bid of $5.50 to buy the entire company, although the Seneca director who favor a higher bid may not. Seneca thinks Dynegy is worth more than $5.50.

The war for Dynegy’s future ought to be fought on the public stage because it has public shareholders. Instead, it is fought in private behind closed doors. The two firms with the greatest financial interests in the firm have immediate access to information about the company’s financial status, it re-financing problems, and when and who the corporation will put in as CEO. Each of these things could effect the stock price, but outside public investors may not know that for hours or even days.

The problem is that the SEC has not stepped in to challenge these conflicts. The agency has not even said it will review any of the Icahn or Seneca moves. It would not be a complex matter; not nearly as complicated at tracking and catching Bernie Madoff’s fraud which arguably took several years and several lost chances.

The SEC has a chance to show that the money taxpayers spend to operate is worthwhile. Dynegy will be sold or auctioned off in pieces, without the SEC even asking the basic question of how Icahn can be an insider with his people on the company board and an outsider as he buys shares.

Douglas A. McIntyre

Note: The Flame Index scans thousands of news sites 24 hours per day and ranks companies getting the most negative press right now. The Flame Index Media Analysis Algorithm crunches the data for an up-to-the-minute ranking of the hardest-hit companies.
The Flame Index started as a research tool in 2008 at the NY Innovation Design Lab (nyidlab). It was used as a general metric to evaluate companies and their risk in the media. Publicly traded Fortune 500 companies are used as a measure to calculate an overall market of negative news and the companies are ranked within that market

Data and ranking provided by the Flame Index.