Schaeffer's S&P 500 Index Hot Stocks Features Phelps Dodge, Humana, Office Depot, Avon Products, and Tyson Foods.

CINCINNATI -- Among the stocks featured in the July 31 edition of Schaeffer's S&P 500 Index Hot Stocks are Phelps Dodge (NYSE:PD), Humana (NYSE:HUM), Office Depot (NYSE:ODP), Avon Products (NYSE:AVP), and Tyson Foods (NYSE:TSN). Schaeffer's S&P 500 Index Hot Stocks is just one of the many free market commentaries written every day at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PRSHS12M&PAGE=1

Schaeffer's S&P 500 Index Hot Stocks for Monday, July 31, 2006: Downgrades and Earnings Reports Weigh on Stocks

A daily feature available on SchaeffersResearch.com is the "SPX Hot Stocks" column. Each afternoon, we will provide a list of the day's top-20 performing stocks in the S&P 500 Index (SPX - 1,277.15) as well as the bottom-20 names. Featured along with this table will be news that is moving some of the securities, including a look at Phelps Dodge and Avon Products.

NOTE: Stocks trading under $5 per share have been eliminated from this listing of the top-20 and bottom-20 performing stocks.

The major market averages continue to trudge through negative territory as we round the corner toward the closing bell. Remarks from two Federal-Reserve officials helped keep away the bulls on Monday, as concerns about yet another rate hike at the central bank's August meeting bobbed to the surface. Also hindering matters were rising crude prices, which jumped higher amid a 10-percent surge in natural-gas futures. At last check, the SPX was lower by 0.12 percent, with 41 percent of its components managing to post gains. Let's run down the most dramatic movers on the SPX today.

We start off with Phelps Dodge (NYSE:PD), which has rallied more than seven percent today. Prudential lifted its rating on the stock to "overweight" from "underweight," citing reduced risks to the company's business now that future merger partner Inco has abandoned its bid for Falconbridge. What's more, the broker opined that PD may have a better chance of becoming an acquisition target itself without Falconbridge added to the mix. Finally, Prudential also observed that PD would be able to rebound even if its planned acquisition of Inco doesn't transpire. Canadian firm Teck Cominco has reportedly set its sights on N as well, boosting the cash fraction of its hostile bid and reducing the shares portion.

Humana (NYSE:HUM) announced second-quarter earnings of 53 cents per share, trumping analysts' expectations of 35 cents per share. Revenue rose 52 percent during the three-month period to $5.41 billion. Looking forward, the insurer left its 2006 outlook of $2.82 to $2.88 per share unchanged. This afternoon, Goldman Sachs upgraded the stock to "buy" from "neutral." The stock is currently higher by more than six percent.

Rebounding from an earnings-related drubbing on Friday, Office Depot (NYSE:ODP) is trading more than six percent higher today. The retailing sector has attracted some bullish players today, who are piling into various positions ahead of this week's same-store sales announcements. The group was also encouraged by the better-than-expected sales guidance that Wal-Mart Stores (WMT) issued this morning.

Moving to the wrong side of breakeven, Avon Products (NYSE:AVP) has given back more than nine percent this afternoon. The personal-products concern said its second-quarter profit dropped 54 percent to $150.9 million, or 33 cents per share. This decline was partially the result of a restructuring program the company launched late last year. Revenue, however, managed to creep five percent higher to $2.08 billion. Analysts were expecting per-share results of 35 cents on $2.06 billion in revenue.

Moving down the list, Legg Mason (LM) has dropped three percent after Buckingham downgraded the brokerage name to "neutral" from "strong buy." After gapping lower last Tuesday on a negative earnings surprise, the stock is trading in territory not seen in more than 13 months.

Meanwhile, Tyson Foods (NYSE:TSN) reported third-quarter earnings this morning. The poultry producer said it lost $52 million during the period, or 15 cents per share. One year ago, TSN managed to gain $131 million, or 36 cents per share. Sales were slightly lower during the reporting period as well, slipping to $6.38 billion. Analysts were expecting a per-share loss of three cents on $6.63 billion in revenue. Too many chickens spoiled the company's broth; TSN officials said an overabundance of chicken in the marketplace was largely to blame for the setback. Concerns about avian flu, rising fuel costs, and challenges on the importing/exporting front also hurt matters. The stock is trading nearly three percent lower this afternoon.

Click the following link to see a Chart of the SPX 500 Index's Top-20 Percentage Gainers: http://www.schaeffersresearch.com/wire?ID=17019

Click the following link to see a Chart of the SPX 500 Index's Top-20 Percentage Losers: http://www.schaeffersresearch.com/wire?ID=17019

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com, is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method.