It's Monday morning, and nothing has come Wall Street's way to save it from getting thrashed for what

Compaq

(CPQ)

did

Friday night.

The top PC maker's warning on first-quarter earnings was an object lesson in how not to do investor relations. To say that your earnings will come in 16 cents lower than analysts' estimates at 15 cents a share is bad enough, but to do it this late in the game, just as earnings season is heating up, is a good deal worse. It suggests a company that either doesn't have a very clear picture of how it's doing, or one that hasn't been forthright with investors. Both of these things are pretty unforgivable. Making things even worse (if possible), Compaq chose to make its announcement late Friday and then didn't have a conference call on the blown quarter, leaving investors gnashing their teeth and analysts fuming over the weekend.

It will take a long time before the Street gets over Compaq and longer still for Compaq to salvage its damaged reputation. In the meantime, investors are trying to figure out what Compaq's trouble means for the rest of tech. They will spend the day trying to handicap how isolated Compaq's trouble is and what it means for the other box makers, the chip companies, the drive makers and so on. They will wonder what

Intel's

(INTC) - Get Report

earnings after the close tomorrow will look like. They will want to hear other computer makers give their outlooks, particularly

Dell

(DELL) - Get Report

, which on Friday said CEO

Michael Dell

sold 8 million shares in March.

With techs crashing down, and taking the broader market with them, there could be some bargain-hunting early on outside of the sector -- particularly in stocks that are direct beneficiaries of the resplendent American economy.

"We could see the drugs, financials, retailers and consumer-nondurables come up," said Bill Meehan, market analyst at

Cantor Fitzgerald

. "But these stocks are by no means undiscovered. The risk-reward looks extremely ugly to me."

The Compaq news is set to send stocks down sharply at the open. At 9 a.m. EDT, the

S&P 500

futures were off 17.5, nearly 17 below fair value and indicating a drop. Treasuries were getting a flight-to-quality bid -- the 30-year was up 12/32 to 97 7/32, dropping the yield to 5.44%.

The Compaq news hurt Asian markets badly. Japan's

Nikkei

fell 348.23, or 2.1%, to 16,507.40. Hong Kong's

Hang Seng

lost 169.36, or 1.4%, to 11,744.74.

Frankfurt's

Dax

has fared the best in Europe -- it was lately down 7.03 to 5117.15. In Paris, the

CAC

was down 42.27, or 1%, to 4320.87. In London, the

FTSE

was down 85.3, or 1.3%, to 6387.5.

Monday's Wake-Up Watchlist

By

Brian Louis

Staff Reporter

  • Blaming weak demand and competitive pricing, Compaq warned after the close Friday it expects first-quarter earnings of 15 cents a share, less than half the 33-analyst First Call forecast of 31 cents. Compaq earned 1 cent in the year-ago period. TheStreet.com wrote about the debacle on Friday.
  • Ford (F) - Get Report, the world's second-largest automaker, is buying Kwik-Fit of Britain, a vehicle maintenance and light-repair chain, for $1.6 billion in cash.
  • BancBoston Robertson Stephens downgraded chip titan Intel to long-term attractive from strong buy. In other news (earnings estimates from First Call):
  • Bear Stearns (BSC) posted third-quarter earnings of $1.42 a share, smashing the five-analyst estimate of $1.15 and up from the year-ago $1.09.
  • CBS (CBS) - Get Report said it is investing in two Internet companies, hollywood.com and storeRunner.com, in separate deals. The hollywood.com investment is part of a planned joint venture with Big Entertainment (BIGE) . Big Entertainment will own 65% of the venture, while CBS will own 35%. The new venture will receive $100 million in promotion, branding and content from CBS, as well as those of its radio and outdoor subsidiary, Infinity Broadcasting (INF) - Get Report, over seven years. Big Entertainment recently announced an agreement to buy hollywood.com from Times Mirror (TMC) . That acquisition is projected to close during the second quarter. Separately, as part of its storeRunner.com deal, CBS will receive 50% of the equity of storeRunner, which operates storeRunner.com, in exchange for about $100 million of promotion and branding support on CBS media over a six-year period.
  • Merrill Lynch upgraded Caterpillar (CAT) - Get Report near-term to accumulate from neutral.
  • Disney (DIS) - Get Report is pondering ways to package its Disney Online assets together with the company's 43% stake in Infoseek (SEEK) for a public offering, The Wall Street Journal reported, citing people familiar with the situation.
  • Dow Jones (DJ) reported first-quarter operating earnings of 44 cents a share, outstripping the nine-analyst estimate of 38 cents.
  • Equitex (EQTX) plans to buy First TeleBanc. A definitive agreement is expected to be inked within 30 days. After the deal, Equitex will change its name to Net1Bank and will apply for the ticker symbol NBNK on the Nasdaq Stock Market.
  • The Pentagon is expected to block General Dynamics' (GD) - Get Report $1.4 billion acquisition of Newport News Shipbuilding (NNS) , the Journal reported, citing government and industry officials familiar with the developments.
  • General Motors' (GM) - Get Report board is expected to decide today to distribute the company's remaining 82% stake in its Delphi Automotive Systems (DPH) unit to shareholders next month, the Journal reported, citing people familiar with the situation.
  • IBM (IBM) - Get Report and RealNetworks (RNWK) - Get Report set a pact to develop an application that will enable consumers to receive and process music and related data from the Internet using IBM security features.
  • Novellus (NVLS) posted first-quarter earnings of 25 cents a share, in line with the 18-analyst estimate, but down from the year-ago 60 cents.
  • United Auto Group (UAG) - Get Report, a chain of auto dealers controlled by Marshall Cogan, is expected to announce it is selling a stake in the company to an affiliate of Roger Penske, the Journal reported, citing people familiar with the matter.