(Updated from 10:13 a.m. EDT)

Telecom equipment stocks are in the spotlight today after

Sanford Bernstein

, which does not act as an investment banker for companies, cut its ratings on

Cisco

(CSCO) - Get Report

and

Nortel Networks

(NT)

to market perform from outperform.

Sanford Bernstein's research is highly valued because of its reputation for maintaining independence from companies, unlike typical brokerage houses, which have traditionally received much of their information directly from companies.

Cisco was lately off 1.5% to $56.44. But Nortel had rebounded from earlier losses and was lately up 3.5% to $61.56.

Other analysts have reiterated their positive recommendations on Cisco and Nortel, making for quite a catfight among the analysts today. Sort of like the old cola wars, nobody's mentioning anybody else's name specifically.

Salomon Smith Barney

reiterated its buy recommendation, calling a "competitor's" downgrade "old news." Solly took an extra swipe by pointing out what it views as the "faux pas" of downgrading a stock just before quarter-end, when shares generally rally.

And

Merrill Lynch

also came out in support of the companies, reiterating its buy ratings on both Cisco and Nortel, while acknowledging that the stocks could be weak for the next few weeks.

TheStreet Recommends

The assumption among some in the market is that companies are pulling back on telecommunications equipment spending.

Trading among other networking and fiber-optic companies has been mixed this morning.

Corning

(GLW) - Get Report

was lately off 1.9%.

JDS Uniphase

(JDSU)

was 0.4% lower. And

Motorola

(MOT)

was down 0.7%.

Telecom equipment giant

Lucent

(LU)

was rallying this morning, up 11%. And

3Com

(COMS)

was gaining 2.6%.