The unofficial closing bells put the DJIA down about 33 points to12,675.75 (-0.26%), the NASDAQ rose just 2 points (0.09%) to 2,786.64, and the S&P 500 fell -0.10% or just more than 1 point to 1,314.63.

There were several analyst upgrades and downgrades today, including Netflix Inc. (NASDAQ: NFLX) maintained as ‘outperform’ with a $100 target price at Credit Suisse; Pan American Silver Corp. (NASDAQ: PAAS) maintained as ‘outperform’ but estimates lowered at Credit Suisse; Halliburton Co. (NYSE: HAL) maintained as ‘buy’ but target price lowered to $54 at Argus; Home Depot Inc. (NYSE: HD) reiterated as ‘buy’ and target price raised to $51 at Argus; ;and Michael Kors Holdings Ltd. (NYSE: KORS) started as ‘overweight’ at Morgan Stanley, as ‘outperform’ at Baird, and as ‘buy’ at Goldman Sachs.

Earnings reports since markets closed on last night have led to some price changes as of the last half hour of trading today: Air Products and Chemicals Inc. (NYSE: APD) is down nearly -3% at $87.29; Baker Hughes Inc. (NYSE: BHI) is down -0.57% at $47.46; Clearwire Corp. (NASDAQ: CLWR) is up 2% at $1.79; EMC Corp. (NYSE: EMC) is up 6.7% at $25.01; Western Digital Corp. (NYSE: WDC) is up 6.2% at $36.85; CSX Corp. (NYSE: CSX) is down -3.5% at $21.89; and Zions Bancorp. (NYSE: ZION) is down -7.6% at $17.15. Apple Inc. (NASDAQ: AAPL) reports earnings after markets close today. See our coverage here.

Other standouts from today include the following stocks:

BioLineRx Ltd. (NASDAQ: BLRX) is up nearly 79% at $5.88 after posting a new 52-week high today of $6.87. The biopharmaceutical company has signed an exclusive worldwide licensing agreement with a French company to develop and market its hepatitis C drug.

Lee Enterprises Inc. (NYSE: LEE) is up more than 26% at $1.39. The newspaper company has been granted permission to exit bankruptcy protection.

The Bon-Ton Stores Inc. (NASDAQ: BONT) is up nearly 18% at $3.81. The department store operator has hired a new CEO who was previously the CEO at Lord & Taylor, before that chain was acquired by a Canadian company.

InterDigital Inc. (NASDAQ: IDCC) is down nearly -20% at $35.68. The wireless technology developed has shut down its “strategic review” without finding a buyer and will continue to seek additional patent sales and licensing agreements.

Achillion Pharmaceuticals Inc. (NASDAQ: ACHN) is up more than 17% at $10.79. The drug company, which is developing its own hepatitis C drug, is enjoying a halo effect from BioLineRx’s announcement.

Stay tuned for Wednesday. President Barack Obama delivers his state of the union address at 9:00 P.M ET tonight. We have noted the following events on the schedule (all times Eastern):

• 7:00 a.m. – Mortgage Bankers Association purchase applications
• 10:00 a.m. – Federal Housing Finance Agency (FHFA) house price index
• 10:30 a.m. – EIA weekly petroleum status report
• 10:30 a.m. – 5-year Treasury note auction
• 2:15 p.m. – Fed chairman Ben Bernanke press conference

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Paul Ausick

Caterpillar, Inc. (NYSE: CAT) Raised to Outperform as Bull of the Day at Zacks.
Halliburton Co. (NYSE: HAL) Reiterated Buy but lowered target to $54 at Argus.
Harmony Gold Mining Co. Ltd. (NYSE: HMY) Raised to Buy at UBS.
Home Depot Inc. (NYSE: HD) Reiterated Buy and raised price target to $51 at Argus.
Interline Brands, Inc. (NYSE: IBI) named as Value stock of the day at Zacks.
KLA-Tencor Corporation (NASDAQ: KLAC) Raised to Buy at Citigroup.
Michael Kors Holdings Limited (NYSE: KORS) Started as Overweight at Morgan Stanley; Started as Outperform at Baird; Started as Buy at Goldman Sachs.
Netflix, Inc. (NASDAQ: NFLX) Maintained Outperform with $100 target at Credit Suisse.
NII Holdings, Inc. (NASDAQ: NIHD) Cut to Underperform as Bear of the Day at Zacks.
Novellus Systems, Inc. (NASDAQ: NVLS) Raised to Buy at Citigroup.
Pan American Silver Corp. (NASDAQ: PAAS) maintained Outperform but lowered estimates at Credit Suisse.
Texas Instruments Inc. (NYSE: TXN) Reiterated Outperform and raised target to $40 at Credit Suisse; Cut to Hold at Kaufman Bros.
Union Pacific Corp. (NYSE: UNP) Reiterated Buy and raised target to $130 at Argus.
Zumiez Inc. (NASDAQ: ZUMZ) Cut to Neutral at Credit Suisse.

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JON C. OGG

The unofficial closing bells put the DJIA down nearly 12 points to 12,708.82 (-0.09%), the NASDAQ fell more than 2 points (-0.09%) to 2,784.17, and the S&P 500 rose 0.05% or less than 1 point to 1,316.00.

There were several analyst upgrades and downgrades today, including ConocoPhillips (NYSE: COP) cut to ‘sell’ at UBS; Sirius XM Radion Inc. (NASDAQ: SIRI) cut to ‘equal weight at Morgan Stanely; Google Inc. (NASDAQ: GOOG) reiterated as ‘buy’ with a $730 target price at Argus; Proctor & Gamble (NYSE: PG) cut to ‘hold’ at Stifel Nicolaus; and Amgen Inc. (NASDAQ: AMGN) cut to ‘neutral’ at JPMorgan.

Earnings reports since markets closed on Friday have led to some price changes as of the last half hour of trading today: Halliburton Co. (NYSE: HAL) is up XX% at $XX; Twin Disc Inc. (NASDAQ: TWIN) is down -XX% at $XX; and PetsMed Express Inc. (NASDAQ: PETS) is up XX% at $XX. We also have a rundown of the 11 stocks included in the DJIA that will be reporting earnings this week.

Other standouts from today include the following stocks:

Minefinders Corp. Ltd. (AMEX: MFN) is up nearly 23% at $13.94. The Canadian silver miner is being acquired by Pan American Silver Corp. (NASDAQ: PAAS) for CDN$1.5 billion.

Goodrich Petroleum Corp. (NYSE: GDP) is up more than 12% at $15.76. The natural gas producer is the biggest gainer among natural gas drillers following an announcement from Chesapeake Energy Corp. (NYSE: CHK) that it was reducing production this year.

Columbia Laboratories Inc. (NASDAQ: CBRX) is down more than -54% at $0.72 after posting a new 52-week low of $0.64 earlier today. The drug company’s progesterone vaginal gel was not approved by a committee of the US FDA.

The Standard Register Co. (NYSE: SR) is down nearly -14% at $2.18, a new 52-week low. The printing and services company announced that it would reduce its workforce by 15% and take other measures in a restructuring of the company. Layoffs would affect about 390 workers.

Rimage Corp. (NASDAQ: RIMG) is down nearly -11% at $11.77. The digital publishing provider lowered its fourth-quarter earnings and revenue forecasts.

Stay tuned for Tuesday. The Federal Reserve’s open market committee meeting starts tomorrow, with a press conference with Fed chairman Ben Bernancke following at 2:30 p.m. ET. President Barack Obama delivers his state of the union address at 9:00 P.M ET. We have noted the following events on the schedule (all times Eastern):

• 11:30 a.m. – 4-week Treasury bill auction
• 1:00 p.m. – 2-year Treasury note auction

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Paul Ausick

Competitors Halliburton Co. (NYSE: HAL) and Baker Hughes Inc. (NYSE: BHI) report results next week. Halliburton is expected to post annual EPS of $3.35 on revenue of $24.58 billion and Baker Hughes is expected to post annual EPS of $4.30 on revenue of $19.90 billion.

For the fourth quarter, Schlumberger posted diluted, adjusted EPS of $1.11 on revenue of $10.97 billion. The consensus estimate called for EPS of $1.09 on revenue of $10.78 billion.

Drilling in the Gulf of Mexico showed the strongest growth in the company’s North American region. Internationally, deepwater drilling offshore of North and West Africa grew most. Schlumberger also showed solid growth in drilling in the Middle East, particularly Iraq.

Here’s what the company had to say about its prospects in 2012:

Uncertainty remains over the outlook for 2012 due to the continuing sovereign debt crisis in Europe which places downward pressure on GDP and oil demand forecasts. Natural gas markets are well supplied in North America with gas storage well above five-year highs. In this environment, the thin excess oil supply cushion is expected to support oil prices close to current levels, while global demand for LNG continues to increase. Recent E&P customer spending forecasts also point to higher E&P investment in 2012, particularly in international markets.

The company is planning on growth in 2012, but did not provide specifics in its quarterly report.

Merkel and Sarkozy

President Nicolas Sarkozy will meet with Chancellor Angela Merkel before all 27 EU leaders gather at the end of this month. It is a sign that just two nations hold the fate of the region in their hands. In a way, that is to be expected. The two have the largest GDPs among all of the region’s nations. Most experts expect that Merkel’s case for the future of the region will prevail over Sarkozy’s. She has more capital at her disposal than he does. If most of Merkel’s agenda for strict budget adherence among the Europeans, enforced by stiff sanctions, are at the core of a French-German proposal for a solution to the EU’s debt troubles, more of the leaders among the 27 countries will view Germany’s actions as a de facto takeover of the region’s monetary policy.

BP and Halliburton

BP (NYSE: BP) has taken the audacious step of insisting that oil services company Halliburton (NYSE: HAL) incur all of the $21 billion in cleanup costs for the Deepwater Horizon explosion. BP says Halliburton workers were responsible for actions that caused the explosion on the rig. The fight between the two corporations is so substantial, and probably complex, that it will be in the U.S. court system for years.

Apple Rumors

Not a month goes by without rumors of a major announcement from Apple (NASDAQ: AAPL). Several media report that the consumer electronics company will stage a meeting in NYC later this month. Some claim that Apple will introduce its iPad 3 or a new Apple TV product. Others believe it is too early in the product cycle to replace the hot selling iPad 2. In the past, Apple meetings that offer no big announcements were disappointments, which often sent shares of the company lower.

Douglas A. McIntyre

Returns of holiday online gifts are expect to reach a record. (Reuters)

Venezuela says it will pay Exxon Mobil (NYSE: XOM) only $225 million for its assets in the country, which is only a third of what the U.S. company was awarded in arbitration. (Reuters)

Total will pay Chesapeake Energy (NYSE: CHK) $2.3 billion for a stake in its shale oil assets. (Reuters)

Bridgewater Associates says it is still bearish for 2012. (WSJ)

Sarkozy and Merkel will meet ahead of an EU meeting to further to address the region’s debt crisis. (WSJ)

More PC companies to introduce ultrabooks, small computers meant to compete with tablets. (WSJ)

California farmers face an unprecedented drought. (WSJ)

Ohio shuts programs used to dispose of waste water from oil and gas drilling as earthquakes increase. (WJ)

Technology increases the oil yield from Prudhoe Bay. (WSJ)

Italy needs to issue 118 billion euros in the first quarter and Spain to issue 60 billion euros. (WSJ)

A lack of electricity will hurt India’s growth. (WSJ)

Car sales drop significantly in Spain and France, based on figures for December. (WSJ)

Sales of German and French debt this week will indicate the capital market reaction to EU problems. (WSJ)

Fidelity Investments may offer ETFs. (WSJ)

Online gambling could help Facebook, Zynga (NASDAQ: ZNGA), Apple (NASDAQ: AAPL) and Google (NASDAQ: GOOG). (WSJ)

Consumer debt makes an ongoing rise in consumer spending unlikely. (NYT)

Caterpillar (NYSE: CAT) locks out workers in Canada because of a contract dispute. (NYT)

BP (NYSE: BP) says that all of the $21 billion it spent for its Gulf clean-up should be paid by Halliburton (NYSE: HAL). (NYT)

Hedge funds make huge bets against the euro as the year ends. (FT)

Junk bond issuance moves higher sharply in the fourth quarter. (FT)

India removes barriers to a number of foreign investments. (FT)

The funding gap for U.S. corporate pensions rises to $450 billion among S&P 500 companies. (FT)

Electric car sales falter as General Motors’ (NYSE: GM) Volt and Nissan’s Leaf sell poorly. (FT)

The world’s largest economies hold$7.6 trillion in debt. (Bloomberg)

U.S. auto dealers post their best year in the past five. (Bloomberg)

Intel (NASDAQ: INTC) and Qualcomm (NASDAQ: QCOM) are in an increasing battle for mobile chips. (Bloomberg)

Douglas A. McIntyre

Oil giants like Exxon Mobil Corp. (NYSE: XOM), BP plc (NYSE: BP), and Royal Dutch Shell plc (NYSE: RDS-A) all eventually won leases on Iraq’s terms, even though the companies did not like the terms. US oil field services companies like Halliburton Co. (NYSE: HAL) and Baker Hughes Inc. (NYSE: BHI) who were subcontracted by lease winners to perform the actual work were the big winners because they did not depend on Iraq for payment, but on the leaseholders.

Exxon Mobil is owed about $50 million for work it has done in southeast Iraq, according to a report in The New York Times. The Iraqis say they are not paying due to a bureaucratic snafu. Others believe Iraq is holding back due to a recent contract Exxon signed with the Kurdish government to develop a field in Kurdistan. Iraq’s central government and the semi-autonomous Kurdish government disagree about which is empowered to offer development deals in Kurdistan and what the terms will be.

The Kurdish contract with Exxon is a production-sharing deal which is far more lucrative than the flat-fee structure that the central government is offering because Exxon owns some of the oil it pumps and gets to sell it at whatever the current market price is.

The oil company has knowingly put itself right in the middle of a domestic Iraqi political dispute by signing the deal with the Kurds. Assuming that Exxon is run by some smart people, the only reason to make that deal is that the potential reward is much greater than the potential risk. Exxon is betting that the Iraqi government will eventually bend to the will of the Kurds because the central government ultimately has no choice. It can’t afford to grant full autonomy to Kurdistan, nor can it use armed force to bring it under control.

Exxon’s deal with the Kurds is certainly worth the delay of a $50 million payment from the Iraqis. Think of it as the ante in a high stakes poker game.

Paul Ausick

Motor gasoline inventories also fell, but by just 400,000 barrels. Gasoline production fell during the week to around 9.4 million barrels/day, and distillate production rose to around 5 million barrels/day.

The report has pushed up the price of crude oil by about 1.5% this morning, and shares in oil producers like Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) are also rising. Shares in services companies like Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), and Baker Hughes Inc. (NYSE: BHI) are declining.

US demand for gasoline has dropped by about 1 million barrels/day when compared with the same period a year ago. Distillate production has risen by about 2.4% in the same time frame, mostly on demand for diesel fuel for export.

WTI crude is trading at $98.27 and Brent is trading at $107.19. Exxon shares are up 0.75% at $82.62 in a 52-week range of $67.03-$88.23. Chevron is trading up more than 1% at $104.76 in a 52-week range of $86.68-$110.01. Schlumberger shares are trading down about -1.86% at $66.90 in a 52-week range of $54.79-$95.64.

Paul Ausick

Eurozone on notice. The situation in Europe, so promising just days ago, took a sharp turn for the worse. S&P put 17 nations in the euro area on credit watch and said it might even downgrade AAA-rated nations, including Germany and France. In theory, this might increase their borrowing costs. In fact, it probably will. Money from international capital markets investors has already begun to shift into safe haven U.S. Treasuries. The S&P action is yet another warning to EU leaders that economists see the sovereign situation deteriorating, as long as the European Central Bank and International Monetary Fund will not provide substantial aid to the weakest nations in the regions, and the eurozone itself will not quickly create a loan facility. News that Angela Merkel and French president Sarkozy want a treaty to force more fiscal discipline within the region hardly provides a road map for a rescue.

Deepwater Horizon fallout. The fighting among the companies involved in the Deepwater Horizon catastrophe has escalated a year-and-a-half after the rig’s explosion. BP (NYSE: BP) has accused oil services company Halliburton (NYSE: HAL) of suppressing data about its role in the incident. The charge is serious and eventually could lead to accusations of fraud. The firms responsible for the well, which also include Transocean (NYSE: RIG), still face tremendous liability. Thousands of individuals and business have staked claims for damages caused by the explosion and leak. The U.S. government and those of several states may bring actions of their own that could seek large penalties.

USPS cuts. The U.S. Postal System’s management continues to advocate greater cuts to save itself from billions of dollars in losses and the weight of its pension plans. Congress may not support these suggestions. There will be political fallout if hundreds of post offices are closed and tens of thousands of postal union members are fired. The most visible of the suggestions made by the Postmaster General is that first-class mail no longer be delivered in one to three business days. The window for delivery would be lengthened to two to five days. But the postmaster is not the captain of his own fate. His suggestions could fall on deaf ears in Congress.

Facebook ad revenue. Facebook sharply increased its market share of online advertising among portals from 2009 to 2010. The trend is more troubling for Facebook competitors, if the 2006 to 2010 period is used as a measurement. Facebook has 0.6% of global internet ad expenditures among portals in 2006. That number was 3.1% last year. The victims of Facebook’s success are primarily Aol (NYSE: AOL), Microsoft (NASDAQ: MSFT) and Yahoo! (NASDAQ: YHOO), each of which has had little if any improvement in ad revenue so far in 2011 compared to last year.

Shale gas growth. The shale gas industry should support more than 850,000 jobs by 2015 and contribute $118 billion to GDP. That is according to a new study from global research firm IHS. The news is unexpected. U.S. energy job growth was not supposed to come from fossil fuel businesses. It has been widely assumed that America had begun to exhaust those assets. Wind, thermal and solar business were anticipated to be the major creators of energy jobs. All three industries have stumbled due to high costs and slow adoption. The success of shale gas shows that new means of exploration and exploitation of fossil deposits still have a promising future.

Douglas A. McIntyre

S&P’s threat of a downgrade of eurozone nations puts huge pressure on the region’s leaders. (Reuters)

An independent panel that reviewed the financial activity of Olympus suggests legal action be taken. (Reuters)

An MIT report says the U.S. power grid is vulnerable to cyber attacks. (Reuters)

BP (NYSE: BP) says high oil prices could hurt global growth. (Reuters)

Samsung announces a new flash memory chip operation in China to cost as much as $4 billion. (Reuters)

John Corzine ignored warnings about his firm’s risky trades, some of which were given to his board by management. (WSJ)

Merkel and Sarkozy will support changes in the euro area treaty that would hold nations more closely to their budgets. (WSJ)

Ford (NYSE: F) begins to search for a CEO as Alan Mulally plans to leave within two years. (WSJ)

AMR (NYSE: AMR) likely will make deep expense cuts so it can exit Chapter 11. (WSJ)

Kraft Foods (NYSE: KFT) announces who will manage the two divisions into which the company will be broken. (WSJ)

Clearwire (NASDAQ: CLWR) will try to raise $300 million. (WSJ)

California Governor Jerry Brown will try to get a tax on high-income residents to cover the costs of education. (WSJ)

Alpha Natural Resources (NYSE: ANR) will pay fines to cover a mining disaster that happened before it owned the operator of the mine involved — Massey. (WSJ)

BP says Halliburton (NYSE: HAL) destroyed evidence about the Deepwater Horizon disaster. (WSJ)

A leading Greek politician says his country’s recession will last through 2013. (WSJ)

Viacom (NYSE: VIA) expects strong ad growth in the near term. (WSJ)

ConocoPhillips (NYSE: COP) says that two agencies approved its drilling in the Alaska’s National Petroleum Reserve. (WSJ)

Eastman Kodak (NYSE: EK) changes some of its advisers as it tries to avoid Chapter 11. (WSJ)

Norway’s sovereign-wealth fund pushes to replace board members at some U.S. firms it owns. (WSJ)

Debate over whether Walmart (NYSE: WMT) will hurt local merchants in India has caused deep rifts in a government that may let large retailers own stores in the country. (NYT)

An antitrust hearing will check issues with the Express Scripts (NASDAQ: ESRX) and Medco Health Solutions (NYSE: MHS) merger. (NYT)

Edgar M. Bronfman Jr. departs as chairman of Warner Music Group (NYSE: WMG). (NYT)

Dubai may refinance $10 billion in state debt. (FT)

Douglas A. McIntyre