Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) is stumbling today as copper and gold futures are down sharply this morning. The US dollar is bouncing back slightly this morning and commodities prices are relaxing somewhat. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on FCX.

The stock has been climbing steadily over the last seven months, hitting a 52-week high of $120.20 earlier this month. This morning, FCX opened at $106.50. So far today the stock has hit a low of $103.35 and a high of $108.19. As of 11:55, FCX is trading at $104.96, down $4.78 (-4.4%). The chart for FCX looks bullish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bearish hedged play on this stock, I would consider a November bear-call credit spread above the $130 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 4.8% return in just 4 weeks as long as FCX is below $130 at November expiration. Freeport McMoRan would have to rise by more than 23% before we would start to lose money. Learn more about this type of trade here.

Halliburton Company (NYSE: HAL) saw shares initially trade down with the broad market this morning, although shares have recovered and are now up over 1% at $39.87 in early trading. The oilfield services giant posted above-expectation earnings over the weekend. Now that Halliburton is beginning to be thought of more of an overseas-based operator, the company posted its actual earnings on Sunday.

Its net income for the quarter was $727 million, or $0.79 per diluted share. This compares to net income of $611 million, or $0.58 per diluted share, in the third quarter of 2006. First Call estimates were $0.64 EPS. Included was a $0.15 per share favorable income tax impact from the ability to recognize United States foreign tax credits that were previously assumed would not be fully utilizable and $0.02 per share after-tax charges for additional reserves related to environmental matters. This would put the comparable number at $0.66 EPS versus the $0.64 estimate. Halliburton's consolidated revenues were $3.9 billion, compared to estimates of $3.87 billion. As a result of Halliburton's organizational restructuring during the third quarter of 2007, the company is now reporting two operating segments: the Completion and Production (C&P) segment and the Drilling and Evaluation (D&E) segment.

MOST NOTEWORTHY: Obagi Medical, Medical, Microsemi, Marathon Oil and Encore Energy were today's noteworthy initiations:

• Obagi Medical Products (NASDAQ: OMPI) was initiated with a Positive rating at Susquehanna, as they like Obagi's growth opportunity in the aesthetics-dermatology market and views the company as an interesting take-out target for a larger specialty pharmaceutical company.
  
• Montgomery believes Microsemi Corporation's (NASDAQ: MSCC) core business is on track and gaining momentum based on leverage in both high-reliability and high-performance analog. The firm started shares with a Buy rating and $34 target.
  
• Goldman initiated Marathon Oil Corporation (NYSE: MRO) with a Buy rating and $72 target, as they view Marathon as most favorably leveraged refining company and would use seasonal weakness in refining margins as a buying opportunity.
  
• RBC Capital sees a large opportunity for Encore Energy Parners (NYSE: ENP) to grow its reserves from internal negotiated transactions from its parent, Encore Acquisition Companies (NYSE: EAC), starting shares off with an Outperform rating and $26 target.

OTHER INITIATIONS:

• BMO Capital initiated DCT Industrial Trust (NYSE: DCT) with a Market Perform rating.
  
• Lehman started shares of Darden Restaurants (NYSE: DRI) with an Overweight rating and $52 target.
  
• The firm also reinstated Radian Group (NYSE: RDN) and MGIC Investment Corporation (NYSE: MTG) with Underweight ratings.

If you're a low-risk investor looking a for modest growth stock with a high degree of safety, Exxon Mobil Corp. (NYSE: XOM) is worth a review.

With the markets in a choppy consolidation mode (or perhaps worse), the integrated oil sector has appeal as a defensive strategy.

Integrated oil and gas giant Exxon Mobil fits the bill, by virtue of its sheer exploration capability, assets, diversification, and managerial prowess. Each year, Wall Street analysts generate at least one research report on the 'fat' that must be cut from 'bloated' Exxon Mobil. Here's the incisive point that doesn't take an MBA from Harvard to discern: in a multinational corporation of that size, there's always going to be an amount of fat (unnecessary positions or operations) -- or at least an interpretation by someone in analytical circles that asserts that fat exists. Meanwhile, XOM, year-after-year, continues to be one of the best-managed companies in the integrated oil sector: upstream is solid, downstream is solid, and in 2007-2008 look for expanding margins in chemical operations.

MOST NOTEWORTHY: The mortgage finance sector, Applebee's, Fuel-Tech, BHP Billiton, Anglo American and Rio Tinto were today's noteworthy downgrades:

• Lehman downgraded the mortgage finance sector to Negative from Neutral citing the potential of over $100B in losses for the group in the coming years. Washington Mutual (NYSE: WM) was downgraded to Equal Weight from Overweight; IndyMac Bancorp (NYSE: IMB) and Countrywide Financial Corporation (NYSE: CFC) were downgraded to Underweight from Equal Weight.
  
• Applebee's International (NASDAQ: APPB) was downgraded to Underperform from Market Perform at Wachovia, as the firm sees potential downside risk if the company's acquisition of IHOP Corp (NYSE: IHP) does not go through, following mixed reviews from Proxy firms.
  
• Merriman downgraded shares of Fuel-Tech (NASDAQ: FTEK) to Sell from Neutral after channel checks indicated the competitive landscape is much more challenging than commonly perceived for the FUEL CHEM product line. Merriman sees significant risk to shares at current levels.
  
• Citigroup downgraded shares of BHP Billiton (NYSE: BHP), Anglo American (NASDAQ: AAUK) and Rio Tinto (NYSE: RTP) to Hold from Buy on valuation following the recent rally.

OTHER DOWNGRADES:

• Lehman downgraded the specialty finance sector to Neutral from Positive; the firm downgraded American Express Company (NYSE: AXP), Capital One Financial Corporation (NYSE: COF) and Discover Financial Services (NYSE: DFS) to Equal Weight from Overweight.
  
• Lululemon Athletica (NASDAQ: LULU) was downgraded to Neutral from Buy at Goldman Sachs.
  
• JP Morgan downgraded Dollar Tree Stores (NASDAQ: DLTR) to Underweight from Neutral.
  
• Angiotech Pharmaceuticals (NASDAQ: ANPI) was downgraded to Sector Performer from Sector Outperformer at CIBC and to Sector Perform from Outperform at RBC Capital.

MOST NOTEWORTHY: Clearwire, Citrix Systems, Altria Group, Overstock.com and Interpublic Group were today's noteworthy upgrades:

• Jefferies upgraded shares of Clearwire Corporation (NASDAQ: CLWR) to Buy from Hold on valuation as they believe the stock is trading as if the Sprint Nextel Corporation (NYSE: S) deal is off. Jefferies thinks the Sprint/Clearwire deal is still in the best interest of both companies.
  
• Deutsche Bank upgraded shares of Citrix Systems (NASDAQ: CTXS) to Buy from Hold, as they believe the contribution from XenSource beginning in Q4 could be better than expected.
  
• UBS upgraded shares of Altria Group (NYSE: MO) citing stronger Q3 International results and potential share repurchases. Shares were upgraded to Buy from Neutral.
  
• Piper Jaffray raised shares of Overstock.com (NASDAQ: OSTK) to Market Perform from Underperform, as they are incrementally more positive on shares following the company's Q3 upside. They believe the company has turned the corner on profitability.
  
• Bear Stearns upgraded shares of Interpublic Group (NYSE: IPG) to Outperform from Peer Perform on valuation and expectations for improved performance in 2008.

OTHER UPGRADES:

• Morgan Stanley upgraded Walgreen (NYSE: WAG) to Overweight from Equal Weight.
  
• Friedman Billings raised its rating on IMS Health (NYSE: RX) to Outperform from Market Perform.
  
• JP Morgan upgraded Stericycle (NASDAQ: SRCL) to Overweight from Neutral.
  
• Citigroup upgraded Xerox Corporation (NYSE: XRX) to Hold from Sell.
  
• RadiSys Corporation (NASDAQ: RSYS) was upgraded to Buy from Hold at Cantor.

Bear Stearns Companies Inc. (NYSE: BSC) is getting a $1 billion investment from Chinese investment bank Citic. The only catch is that Bear Stearns has to invest $1 billion in the Chinese company. Citic can buy as much as 9.9% of Bear Stearns if it wants to.

Why swap money? That's a good question. Bear Stearns' stock is flat today, trading around $116.50, not far from its low and a great distance from its 52-week high of almost $173.

The Wall Street Journal says that "the investment highlights China's increasing financial prowess on the global stage, and the eagerness with which Western firms are hoping to penetrate the insular Chinese financial sector." But there is no reason to believe that trading investment dollars will do anything to achieve that.

Citic is a big underwriter of Chinese IPOs. How that helps Bear Stearns is bit of a mystery. If Citic wanted make a big push into the US market, it should have cut a deal with a first-tier firm like Morgan Stanley (NYSE: MS).

The lackluster reaction of Bear Stearns' stock price today shows the market does not think much of the deal. It shows that investors have sense. There is no there there.

Douglas A. McIntyre is an editor of 247wallst.com.

Circuit City Stores, Inc. (NYSE: CC) has said it will be rolling out quite a few new initiatives to increase customer awareness and education on the digital television transition set to occur in 2009. This should come as no surprise, as there will inevitably be millions of U.S. consumers who will needlessly fret when the analog television signals currently being broadcast cease to exist in a little under two years.

This is where Circuit City has a chance to shine. For years (well, for a decade, really), the consumer electronics chain has been beaten by larger rival Best Buy, Inc. (NYSE: BBY), and the pressure has only become more intense in recent years.

Circuit City no doubt sells quite a few television sets, although the profit misses and generally bad quarters in the last six months or so has been largely attributed to the declining profit margins on flat-panel televisions. This is the very product Circuit City now wants to trumpet as it reaches out to consumers to offer education well ahead of the actual analog-to-digital hand-off.

A lot of big tech companies have tried to network the nation's living rooms so that material from the PC can be moved to the TV without a hassle. Microsoft (NASDAQ:MSFT) has a home entertainment software package. Intel (NASDAQ:INTC) has built chips for the networked home. Apple (NASDAQ:AAPL) TV is aimed in that direction. None of them seem to have gotten much adoption.

Into that mix walked storage device market Sandisk (NASDAQ:SNDK). The company is launching Sansa TakeTV, a device that stores video and can physically move content from the PC to the TV. This avoids the need for an entire home network.

According to The Wall Street Journal "SanDisk also is introducing a test version of an Internet video service, called Fanfare," This collection of ad-supported programming will compete with iTunes.

The idea is nutty. Sandisk has almost no brand awareness with consumers. It builds storage devices to operate in products like PCs which carry the branding. Weakness in the company's core business has taken its stock down 20% in the last month.

What Sandisk's needs to do is improve its main business. With virtually no consumer branding for its company name and the new device, the launch is a waste of time and money.

Douglas A. McIntyre is an editor at 247wallst.com

Apple (NASDAQ: AAPL) is recently up $0.63 to $171.17 in pre-open trading.

• AAPL will report Q4 EPS after the close tonight.
  
• BMO Capital says: "AAPL is well positioned for the holiday season with a strong product line-up – iPhone in the US and Europe, refreshed iPods and iMacs plus Leopard."
  
• AAPL November option implied volatility of 59 is above its 26-week average of 43 according to Track Data, suggesting larger price movement.

AT&T (NYSE: T) is expected to report EPS of 71 cents on 10/23 according to Thomson First Call.

• CIBC World says: "we expect strong results led by wireless and enterprise."
  
• T November option implied volatility of 29 is above its 26-week average of 26 according to Track Data, suggesting larger risk.

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

TheStreet.com's Jim Cramer says 10 crucial factors took their toll during that dreadful session.

I'm still trying to get my arms around what happened to the market Friday. The action can be traced, I believe, to the following crucial factors:

1. The bull market in oil services, the best one around, got the stuffing knocked out of it by Schlumberger's (NYSE: SLB) (Cramer's Take) quarterly report, which showed that the U.S. is so bad that it can kibosh even the best international driller. I think that the problems are not specific to Schlumberger in that nearly all oil-services companies except for Transocean (NYSE: RIG) (Cramer's Take) have a tad of North American exposure, and a tad is toxic.

2. Caterpillar (NYSE: CAT) (Cramer's Take) once again was felled by how awful the U.S. economy is, with a quarter that reminded us that we are just a few footsteps from recession. Without aggressive Fed rate cuts, we are there in six months.

3. Honeywell (NYSE: HON) (Cramer's Take) and 3M (MMM) (Cramer's Take) had been terrific stocks for so long that we got spoiled by them and their earnings power overseas. They were felled by the U.S.

4. Mortgages: Wachovia (NYSE: WB) (Cramer's Take), a conservative lender, got destroyed by mortgages, or, more specifically, home equity loans, which are capable of taking down pretty much everything. Go no further than the honest analysis that E*Trade's (NASDAQ: ETFC) (Cramer's Take) Mitch Caplan offered this week to see what I mean.

5. A belief that a mortgage insurer is going to go belly-up. The action indicates that this is possible, and I credit my friend Doug Kass for this insight.

6. Mutual fund selling season: There are 10 more days to go to sell winners and sell losers and lock in some capital gains without big tax consequences. With so many funds up, that makes a ton of sense.

7. Expiration. Once you took out the bottom strikes, it looks like there were a lot of puts sold that kicked in to be longs. Check out the Schlumberger 105 put position if you want to see how this works. That was an accident waiting to happen.

8. Ridiculous bullishness off of the Investors Intelligence numbers, which showed more than 60% bulls. That's always a danger sign.

9. Worries about the Fed not doing the right thing. There is a persistence of thought that the Fed doesn't get it, even after the 50-basis-point cut. They get it, believe me.

10. Anniversary of the crash. That 20-year jinx was big, and it caused people down 200 to freak out and sell to beat the down-500 crowd.

That's my quick look at what caused Friday's rout. But more work on what's next is needed.

Random musings: Friday I took my 16-year-old daughter to visit colleges. I didn't check in once with a blog entry after the market opened. It was a bad day not to check in. For those who have been helped by these columns on the big down days, you have my apologies. But those who know me well know that I have done enough damage with my obsession. It was the right thing to do. I have to, at some point, start doing what is right by my family.

RELATED LINKS:

• Top Rocket Stocks for Earnings Week of Oct. 22
• How a Mutual Fund Turned Losses Into Gains

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Caterpillar and Transocean.

Wal-Mart (NYSE: WMT) will spend $878 million to buy the remaining outstanding shares it does not already own in Japanese supermarket unit Seiyu.

According to Reuters, "The world's largest retailer has invested more than $1 billion in Seiyu since 2002." The Japanese retail operation has lost money for five years. Wal-Mart will pay public shareholders a 61% premium for their shares.

Wal-Mart has exited some markets, such as Korea, because of poor results. But, Japan is one of the world's largest retail markets, and the company may feel that it cannot walk away from an opportunity there when sales at home.

And that may be the reason Wal-Mart would take the risk. A large portion of the company's growth last quarter came from outside the U.S., and the world's largest retailer has become an international company. Its strongest market is Mexico and it is also doing well in China. But there is no telling what could happen in the world's most densely populated country. The government has already put a union into the company's stores there.

Japan needs to work for Wal-Mart. There are only so many big markets left.

Douglas A. McIntyre is an editor of 247wallst.com

MAJOR PAPERS:

• CtW Investment Group sent a letter to Countrywide Financial Corporation's (NYSE: CFC) Board of Directors "urging" for the resignation of CEO Angel Mozilo, reported the Wall Street Journal (subscription required).
  
• According to antitrust attorneys, a possible merger with a Big Pharma company may result in Biogen Idec (NASDAQ: BIIB) having to divest some overlapping assets or licensing deals in order for the deal to get approval from the Federal Trade Commission, reported the Financial Times "MergerMarket" blog.
• The Financial Times reported that Gilat Satellite Networks (NASDAQ: GILT) is working with UBS to evaluate "several strategic and private equity buyers" in buying Gilat, which could get over $500M in a sale, according to people familiar with the matter. Bids for the company are due by the end of the week, said the sources.

OTHER PAPERS:

• The New York Times reported that Chinese investment bank Citic Securities is planning to invest $1B in Bear Stearns Companies (NYSE: BSC), according to sources.
• The New York Times reported that the head of the Federal Trade Commission, or FTC, has rejected numerous requests to open an investigation into Intel Corporation (NASDAQ: INTC) for anticompetitive conduct, according to inside sources.
• The Guardian reported that world oil production peaked last year, and production will fall by half as soon as 2030, according to a report by Germany-based organization Energy Watch Group.

Toyota (NYSE:TM) has enough problems. It lost its No.1 place in the Consumer Reports reliability survey. It had to recall several thousand of its cars in Japan. It trades near its 52-week low.

According to Bloomberg "GM (NYSE:GM) sold 7.06 million vehicles through September, taking a lead of 10,000 units over Toyota's 7.05 million, the two companies said in separate statements. At the end of the first half, Toyota led by 39,000 vehicles. "

Toyota loyalists might well ask what happened. GM is doing well in South America and holding it own in Europe. But, to a large extent the biggest US car company has built a China strategy which puts it in the lead in that market neck-and-neck with VW.

But, most important, GM has stopped its sales slide in the US. In each of the last two months sales have been flat to slightly up, and it appears that its new models are catching on. Its crossovers are selling especially well as are its new and more fuel-efficient sedans.

With a new UAW contract under its belt, GM now has a chance to build cars in the US for about the same cost as Japanese rivals. GM may not only sell more cars. It might also make money on most of them.

Douglas A. McIntyre is an editor at 24/7 Wall St.

It's a bit more than 20 years since the Dow fell 508 points, or 22.6%, in a single day. With Asian and European markets down a mere 1% to 4% today, it does not look like we'll have a repeat of that 23% decline today. What's happening in world markets? According to the New York Times, Hong Kong fell 3.3%, Japan tumbled 2.2%. South Korea was down 3.25%. In Europe the early news was not as bad -- London's FTSE 100 was down 1.4%, the German DAX dropped 1.3%, and Paris slid 1.8%.

Twenty years ago, the CEO of the company I worked for sent one of my colleagues to figure out good stocks to buy -- considering the market plunge an opportunity to buy good stocks at a discount. It turned out that he was right. The cause of the crash was found to be related to simultaneous computer driven-selling that somehow took the rationality out of stock valuations.

But will today's potential plunge also turn out to be a buying opportunity? The answer depends on your time frame and which stocks you buy. It's never clear to me why markets go up and down although "explanations" get printed every day. But it could be that the big reason for the selling in global markets is fear. In particular, investors fear that the U.S. has unleashed a subprime mortgage-backed securities (MBS) financial virus that is sucking an unknown -- but enormous -- quantity of credit out of the global financial system.

Hank Paulson's floundering effort to rescue the world from this MBS viral epidemic is not inspiring confidence. So I would not be eager to rush out and buy stocks in this market. Unlike the computer-driven selling of 1987, the economic costs of MBS's financial "innovation" are still too difficult to count.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter.