The world's banks are swallowing each other up, and for Wall Street, that's a wonderful thing.

Over the weekend,

UniCredito Italiano

, Italy's second-largest bank, said it will merge with

Banca Commerciale Italiana

. The combined bank would take over the No. 1 spot in Italy from

San Paolo IMI

. For its part, San Paolo said it plans to take out

Banca di Roma

.

Meanwhile, there are reports that

Grupo Financiero Banamex-Accival

and

Grupo Financiero Bancomer

, Mexico's largest banks, are mulling a combination. Add to that the ongoing brawl in France, where

Banque Nationale de Paris

has attempted to thwart the merger of

Societe Generale

and

Paribas

by putting in hostile bids for both banks, and it's clear that global banking consolidation is heating up. One wonders when it will spill over our borders.

Typical of a Monday, there are other deals this morning.

Comcast

(CMCSK)

announced that it will buy

MediaOne Group

(UMG)

in a stock deal. France's

Vivendi

said it will buy

U.S. Filter

(USF)

.

Yet despite these positives, the stock market looks like it may have a bit of trouble running higher this morning. At 9 a.m. EST, the

S&P 500

futures were up 0.8, leaving them about a point and a half below fair value and indicating some weakness at the open. The falloff on Friday, continued worries about

IBM's

(IBM) - Get Report

revenue and a market that seems to have gotten

Dow

-10,000 shy are putting some pressure on stocks.

"I think we need to feel comfortable at this level," said Jim Herrick, managing director of trading at

Robert W. Baird

. "Right now, investors feel that 10,000 is a little too high on the Dow. We're going to be in a trading range for a while until we get any preannouncements and we see some first-quarter earnings."

Herrick said a lot of the focus today will be on IBM. There is one camp, led by

Morgan Stanley Dean Witter

, that thinks the company's going to have lower revenue. The other, led by

Merrill Lynch

, thinks everything's hunky-dory. Also weighing on tech, there are rumors that

Compaq

(CPQ)

is going to miss its numbers.

The expected glut of supply from

AT&T's

(T) - Get Report

$5 billion to $6 billion bond offering this week continues to pressure the Treasury market. The 30-year Treasury bond was of 1/32 to 95 19/32, putting the yield at 5.55%. The bond-futures contract was lately down 7.

With the Tokyo market closed for the beginning of spring, Hong Kong traders had a hard time figuring out where to take the market. So they pretty much left it where it was on Friday. The

Hang Seng

added 24.32 to 11,107.24 in thin volume.

Europe's major markets were mixed. In Frankfurt, the

Dax

was off 58.69, or 1.2%, to 5040.79. In Paris, the

CAC

was down 20.93 to 4198.72. But in London, the

FTSE

was up 4.4 to 6167.6.

Monday's Wake-Up Watchlist

By

Brian Louis

Staff Reporter

  • Comcast is buying MediaOne in a deal valued at $60 billion in stock and the assumption of debt. MediaOne shareholders will receive 1.1 Comcast Class A shares for each MediaOne share they own, or $80.16 a share, a premium of about 32% over MediaOne's Friday closing price of 60 3/4. Upon completion of the transaction, MediaOne shareholders will own about 64% of the combined company. The combined company on a pro forma basis will serve 11 million cable customers with systems that pass over 18 million homes domestically. While the agreement bars MediaOne from soliciting competing acquisition proposals, it has 45 days to accept a superior proposal, subject to payment of a fee of $1.5 billion to Comcast.
  • France's Vivendi is buying U.S. Filter for about $6.2 billion in cash. The combination with Vivendi's Generale des Eaux unit will create a water-treatment giant with $12 billion in annual sales. Under the deal, U.S. Filter stockholders will receive $31.50 a share in cash, a slight premium to the stock's closing price of 30 1/2 on Friday.
  • Microsoft (MSFT) - Get Report plans to begin settlement talks with the Justice Department and 19 states in an effort to end the federal antitrust trial against it, The Wall Street Journal reported. The Journal said the sides remain far apart on some fundamental issues and it is viewed as unlikely that a settlement will be reached before the trial resumes next month. The Journal reported that Microsoft's legal team decided to proceed with negotiations after meetings with Mister Softee Chairman Bill Gates and other senior execs.
  • Gucci (GUC) said it would consider an $81-a-share bid from LVMH Moet Hennessy Louis Vuitton (LVMHY) . The fashion concern rejected an $85-a-share bid for shares owned by holders other than Pinault-Printemps-Redoute and Gucci's employee stock ownership plan, saying it wasn't open to all Gucci shareholders. Gucci said it would propose a meeting with LVMH to discuss the deal. Gucci shares closed Friday at 81. In other news:
  • Banc One Investment Advisors announced the merger of Pegasus Funds with The One Group Family of Mutual Funds. The new fund family, named One Group Mutual Funds, offers 48 mutual funds, and has more than $56.2 billion in assets under management. One Group is the proprietary fund family of Bank One (ONE) - Get Report. The Pegasus funds were the proprietary fund family of First Chicago NBD, which merged with Bank One last year.
  • Merrill Lynch (MER) Chairman and Chief Executive David Komansky told analysts that Merrill is open to a merger deal with a commercial bank in the future, but he chilled speculation that Merrill was moving toward soon joining up with Chase (CMB) , the Journal reported. Last week, the Journal reported that Chase Chairman and CEO Walter V. Shipley has made informal overtures to potential merger partners on Wall Street in the past year and offered senior execs the possibility of a CEO slot in the merged firm. Among the firms approached: Goldman Sachs, Merrill, Morgan Stanley Dean Witter (MWD) and J.P. Morgan (JPM) - Get Report, the Journal reported.