Bankers got rocked yesterday, hit by a Molotov cocktail of fear and loathing.

Fitch

, an international credit rating agency, raised red flags about the state of 19 Japanese banks.

Goldman Sachs

made negative comments about German banks as foreign markets sold off. Then American markets opened, and skittish investors sold bank stocks by the fistful.

Analysts rushed to look into banking and financial stocks after yesterday's close, picking through the rubble to see how a Japanese banking crisis could impact America's biggest banks.

According to a note from Goldman Sachs analyst Lori Applebaum, American banks should be fine. "U.S. banks had total Japanese exposures

in loans and derivatives of roughly $25 billion or just 1% of total assets, with most of this exposure with multinational banks," she wrote.

Bank of America

(BAC) - Get Report

is one of her highest rated bank stocks, put on the much-heralded U.S. Recommended for Purchase List.

American banks don't seem to have a great deal of exposure to a Japanese credit deterioration, but what about the lingering psychological effects of a worldwide banking crisis?

Credit Suisse First Boston

analyst Henry Dickson, who agreed that American banks had only a modest exposure to Japanese credit woes, said that perception could be a problem. But overall, Dickson said that irrational fears could lead to a buying opportunity.

"We think the recent decline represents an opportunity to invest in some of our group's stronger performers," he said. "The greater risk seems to be economic risk and perception risk. To the extent, the concerns about Japanese banks create a Fed bias for a larger rate cut, that would at least provide some downside support and be good for the longer term investment case."

Hear that?

Communications software got a boost from CSFB analyst Susan Passoni today. The analyst told investors that fundamentals within the industry were still solid, despite the larger economic downturn in the economy. Citing a 65% drop in communication software stocks from their 52-week highs, Passoni recommended that investors look into a pair of names.

The move comes one day after communications software company

Comverse Technology

( CMVT) hit the ground with a splat despite announcing solid earnings and raising growth forecasts.

Goldman Sachs did not like what it heard, cutting the company's rating to market outperform and removing it from the U.S. Recommended for Purchase List. Essentially, Goldie didn't think Comverse's higher guidance was good enough to warrant an upswing in its stock.

But CSFB defended Comverse and the communications software business. Comverse was called a buy, while

Amdocs

(DOX) - Get Report

was listed as a strong buy, down 38% from its high and up 20% from its low. Passoni called both companies "compelling" because of their strong cash balances and ties with big clients.

Upgrades

Allergan

(AGN) - Get Report

: UP to buy from hold at

UBS Warburg

.

Skywest

(SKYW) - Get Report

: UP to strong buy from hold at UBS Warburg.

Downgrades

AudioCodes

(AUDC) - Get Report

: DOWN to market outperform from U.S. Recommended for Purchase List at Goldman Sachs.

Avistar Communications

(AVSR)

: DOWN to long-term buy from intermediate-term buy at

J.P. Morgan Chase

.

Cosine Communications

(COSN)

: DOWN to long-term buy from intermediate-term buy at J.P. Morgan Chase.

GlobeSpan

(GSPN)

: DOWN to buy from strong buy at

Thomas Weisel

.

Nvidia

(NVDA) - Get Report

: DOWN to hold from strong buy at

Prudential Securities

.

PPL

(PPL) - Get Report

: DOWN to buy from strong buy at CSFB.

Teletech

(TTEC) - Get Report

: DOWN to buy from strong buy at

ING Barings

.

Initiations

Advanced Fibre Communication

( AFCI): NEW strong buy at

Lehman Brothers

; price target: $32.

Alltel

(AT) - Get Report

: NEW neutral at

W.R. Hambrecht

; price target: $60.

Avaya

(AV)

: NEW accumulate at

Merrill Lynch

.

Next Level Communications

( NXTV): NEW market perform at Lehman Brothers.

Riverstone Networks

( RSTN): NEW strong buy at Merrill Lynch.