Updated from 3:50 p.m. EDT

Compaq

(CPQ)

was down 1/8 to 25 9/16 after it responded to a negative research note from

Salomon Smith Barney

by saying its inventories at third-party sellers, such as retailers, have been low and that there have been no changes to standard price-protection terms. A Compaq spokesman said the second quarter has been backend loaded because of supply constraints early in the quarter. Backend loaded means that the bulk of sales come in toward the end of the quarter.

During Thursday's trading session, Salomon Smith Barney analyst Richard Gardner cut his near-term price target and rating on the stock, citing concerns about second-quarter inventories. Gardner said he believes Compaq's channel inventories are the highest among PC vendors and that inventory buildup may have a negative near-term impact on PC margins. The stock was cut to neutral from buy and its near-term price target was slashed to 25 from 45.

This morning, several analysts on the Street issued comments supporting the PC manufacturer.

Lehman Brothers'

influential tech analyst Dan Niles reiterated a buy on Compaq, and

CIBC World Markets

,

Donaldson Lufkin & Jenrette

,

Banc of America Securities

and

PaineWebber

were supportive in morning comments.

Compaq was initiated a strong buy by

Prudential Securities

; price target: 49. The downgrade, which came late yesterday afternoon, added momentum to the tech

selloff.

In an effort to boost its sagging stock,

AT&T

(T) - Get Report

is considering selling or creating a tracking stock for the company's consumer long distance operations, cable-TV unit and other divisions,

The Wall Street Journal

is reporting people familiar with the matter as saying.

The sources said no decision has been made, no steps are imminent and other options are being considered. The stock was off 1/2 to 31 3/4.

Xerox

(XRX) - Get Report

, up 1 7/8, or 10.1%, to 20 7/16, said it has been informed that the

Securities and Exchange Commission

began an investigation of accounting issues related to the company's Mexico business.

TheStreet.com/NYTimes.com

joint newsroom wrote about the

investigation in a separate story.

Mergers, acquisitions and joint ventures

Air Canada

(ACNAF)

was unchanged at 11 3/4 even though it put its recently acquired

Canadian Regional Airlines

up for sale, satisfying the federal competition bureau and moving one step closer to completing its takeover of

Canadian Airlines

. Air Canada acquired the regional airline in December as part of its $63 million purchase of Canadian Airlines.

America Online

(AOL)

, up 1 1/8 to 52 7/8, and

Tribune

(TRB)

, down 7/16 to 35, said this morning that AOL may buy Tribune's 20% stake in local entertainment guide

Digital City

.

Barrick Gold

(ABX)

was up 3/8 to 18 3/16 after it said it will buy

Pangea Goldfields

for $138 million in an all-cash deal.

Terms of the deal call for Barrick, North America's second-largest gold producer, to buy all the outstanding common shares of Pangea. Pangea's board unanimously approved the offer and agreed to recommend it to its shareholders.

Online music retailer

CDnow

(CDNW)

said it is continuing talks with multiple parties to find an investor or a merger deal and hopes to complete a transaction in the next several weeks. The company has not agreed on terms with anyone. The stock has tumbled in recent months and is down more than 70% for the year to date, but finished the day up 9/32, or 10%, to 3 3/32.

Earlier in the month, the cash-strapped company said it expected to announce a deal by the end of June.

Celgene

(CELG) - Get Report

said it would acquire

Signal Pharmaceuticals

for $196 million or 3.67 million shares of stock.

On the heels of the announcement, Signal withdrew its $66 million IPO.

Dexter's

(DEX) - Get Report

board rejected the

International Specialty Products'

(ISP)

tender offer to buy its shares for $45 each, saying the offer was "inadequate" and not in the best interests of its shareholders. The board also recommended that shareholders reject the tender offer. Dexter was up 5/8 to 48, while International Specialty Products was up 3/16 to 5 11/16.

The European Commission said it cleared

Ford

(F) - Get Report

to buy

Land Rover

from

BMW

, citing Ford's small shares in the British market for special utility four-wheel passenger cards or jeeps. Ford was down 1/4 to 43.

German industrial conglomerate

Siemens

(SMAWY)

said German antitrust officials cleared its proposed $2.1 billion acquisition of

Shared Medical Systems

(SMS)

. The stock was barely higher, up 1/16 to 72 15/16.

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Earnings/revenue reports and previews

Footwear and apparel giant

Nike

(NKE) - Get Report

posted fourth-quarter earnings of 46 cents, including a $1.8 million pretax restructuring gain, in line with the 13-analyst estimate of 46 cents and up from the year-ago 33 cents, which included a charge. Nike said net income rose to $126 million in the quarter, from $94 million a year earlier. Meanwhile, revenues rose 4% in the period, to $2.3 billion from $2.2 billion. The stock edged up 5/16 to 39 13/16.

American Financial Group

(AFG) - Get Report

warned that its second-quarter profits would be cut by litigation charges and worse-than-expected underwriting results in its property-casualty insurance operations. The company said earnings would likely be substantially below the 65 cents a share it reported in the first quarter. The current three-analyst estimate calls for 63 cents. The stock finished off 2 1/8, or 7.9%, to 24 13/16.

Argosy

(AGY)

said it expects second-quarter earnings to fall short of estimates. The company expects earnings of 37 cents to 40 cents a share, compared with the seven-analyst estimate of 45 cents. The stocked dropped 3 7/16, or 19.3%, to 14 3/8.

News that

Chartered Semiconductor

(CHRT)

, one of Asia's largest semiconductor foundries, said second-quarter results are likely to be ahead of expectations amid booming demand for chips, pushed the stock up 5 7/8, or 7%, to 90. The current five-analyst estimate is for 22 cents a share.

Furniture manufacturer

Herman Miller

(MLHR) - Get Report

, down 1 13/16, or 6.6%, to 25 7/8, posted fourth-quarter earnings of 50 cents a share, in line with the nine-analyst estimate and up from the year-ago 48 cents.

Hercules

(HPC)

said its second-quarter results will reflect a net charge of $12 million. The company said excluding items, its earnings will be in the low-to-mid 20 cents a share range. The 10-analyst estimate is for 37 cents a share. The stock slipped 5/16 to 14 1/16.

Health information services company

Hooper Holmes

(HH)

warned it sees second-quarter revenues and earnings below expectations because of a sales shift and higher-than-expected costs related to its acquisition of

Paramedical Services of America

. Earnings per share are expected to be in the range of 6 cents to 7 cents, below the eight-analyst estimate of 10 cents.

Hooper-Holmes plummeted 21%, or 2 1/8 to 8. It was also cut down to neutral from buy at

Dain Rauscher Wessels

.

Intraware

(ITRA)

fell 2 11/16, or 14.3%, to 16 1/16 after it posted a first-quarter loss of 40 cents a share, narrower than the four-analyst expected loss of 45 cents but wider than the year-ago loss of 16 cents.

Reliant Energy

(REI) - Get Report

said it expects second-quarter earnings to be 15% to 20% above expectations because of increased earnings from a growing multi-regional generation portfolio and higher trading margins. The current estimate is for 48 cents a share. It was up 5/8 to 30.

Wireless two-way pager marker

Research in Motion

(RIMM)

posted first-quarter earnings of 1 cent a share, better than the 11-analyst expectation for break-even results, but down from the year-ago 3 cents. The company said the dip in its latest quarter reflects growing expenses for marketing and research and development. Still, the stock managed to rise 6 3/8, or 16.4%, to 45 1/4.

Roper Industries

(ROP) - Get Report

dropped 7 1/8, or 21.8%, to 25 5/8 after it said third-quarter earnings would come in between 35 cents and 37 cents per share, compared with 41 cents per share for the same time period a year ago. The current nine-broker

First Call/Thomson Financial

consensus estimate was for 51 cents a share.

Speedfam-IPEC

(SFAM)

posted fourth-quarter earnings of 10 cents a share, in line with the six-analyst estimate and better than the year-ago operating loss of $1.58. It was 3/4 lower to 18 3/16.

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Analyst actions

Two different directions are being taken on

Eli Lilly

(LLY) - Get Report

today.

Goldman Sachs

upped 2001 estimates to $3.10 a share from $3.07 a share while PaineWebber downgraded the stock to neutral from attractive. Also, DOWN to attractive from buy at

Bear Stearns

. It sank 2 1/8 to 99 1/2.

Goldman Sachs overnight put

Ericsson

(ERICY)

and

Nokia

(NOK) - Get Report

on their recommended list. The company also started

Alcatel

(ALA)

at a market outperform. Ericsson was up 1 5/16, or 7%, to 20, Nokia was up 1 11/16 to 49 15/16 and Alcatel was up 3 7/8, or 6.2%, to 66 1/2.

Upgrades:

Altera

(ALTR) - Get Report

hopped up 5 1/4, or 5.4%, to 101 15/16, after it was UPped to strong buy from buy, price target UP to 135 from 120, both at

Chase Hambrecht & Quist

.

M-Systems Flash Disk Pioneers

(FLSH)

: UP to strong buy from buy at

Chase Hambrecht & Quist

. It was up 2 7/8 to 77 7/8.

Philip Morris

(MO) - Get Report

: Goldman Sachs upped 2000 estimates to $3.68 a share from $3.65 a share and 2001 to $4.10 a share from $4.05 a share. It tumbled 1/2 to 26 9/16.

Praxair

(PX)

edged up 1/4 to 37 7/16 after its rating was UPped to strong buy from buy at

Deutsche Banc Alex. Brown

, price target: 50.

Downgrades

PaineWebber and

Merrill Lynch

cut earnings estimates for

Unisys

(UIS) - Get Report

this morning, after the company yesterday warned that second-quarter earnings would only be about half of expectations. PaineWebber cut its second-quarter estimate to 18 cents per share from 38 cents per share, and 2000 estimates to $1.48 a share from $1.74 a share. Merrill Lynch downgraded the company to intermediate-term neutral, and dropped its second-quarter estimate to 20 cents a share and 2000 estimate to $1.42 a share from $2.16 a share. The stock was down 3/16 to 14 9/16.

TheStreet.com/NYTimes.com

joint newsroom wrote about Unisys on

Thursday.

BioChem Pharma

(BCHE)

: DOWN to buy from strong buy at Credit Suisse First Boston. It was down 3/8 to 24 5/8.

Merrill Lynch lowered its fiscal fourth-quarter earnings estimate for

News Corp.

(NWS) - Get Report

due to a lousy performance by the film

Titan A.E.

Its estimate was cut to 16 cents per share from 26 cents a share. Merrill also cut fiscal fourth quarter estimates for

Fox

(FOX) - Get Report

to zero cents a share from five cents a share. News Corp. managed to edge up 2 to 54 1/2, while Fox was up 3/8 to 30 3/8.

NorthPoint Communications

(NPNT)

: DOWN to market perform from buy at

Deutsche Banc Alex. Brown

. It crept up 3/8 to 11 3/16.

SBA Communications

(SBAC) - Get Report

sunk 4 11/16, or 8.3%, to 51 15/16. It was cut DOWN to reduce from hold at

UBS Warburg

.

Stryker

(SYK) - Get Report

: DOWN to buy from top pick at

ABN Amro

. It was off 1/4 to 43 3/4.

Even though

US LEC's

(CLEC)

rating was lowered to accumulate from neutral at Merrill Lynch, it was up 1 1/6, or 6.7%, to 17.

Initiations

Despite the news that

DDI

(DDIC)

was started as a NEW buy at

Lehman Brothers

with a price target of 36, the stock ended the day off 1 3/16 to 28 1/2.

JDS Uniphase

(JDSU)

: NEW highlighted stock at

PaineWebber

. It jumped 3 1/2 to 119 7/8.

TRW

(TRW)

: NEW buy at

Credit Suisse First Boston

, price target: 60. The stock was off 3/8 to 43 3/8.

Titan

(TTN)

rose 1 15/16 to 44 3/4. CSFB started coverage on the stock as a NEW buy with a price target of 60.

United Rentals

(URI) - Get Report

fell 1 5/16, or 7.1%, to 17 1/8, after it was started as a NEW buy at

Donaldson Lufkin & Jenrette

, price target: 35.

Wellpoint Health

(WLP)

: NEW strong buy at

Prudential Securities

; price target: 110. The stock was down 1 1/8 to 72 7/16.

Group Moves

Prudential Securities initiated coverage of the oil & gas exploration & production sector with a strong buy rating of the following companies:

  • Ocean Energy (OEI) , down 5/8 to 14 3/16, with a price target of 21;
  • HS Resources (HSE) , up 9/16 to 30, with a price target of 40;
  • Newfield Exploration (NFX) , up 1 3/16 to 39 1/8, with a price target of 52;
  • Louis Dreyfus Natural Gas (LD) - Get Report, was unchanged at 31 5/16, with a price target of 44;
  • Spinnaker Exploration (SPNX) , down 5/8 to 25 5/8, with a price target of 33;
  • Evergreen Resources (EVER) - Get Report, up 3/8 to 29 5/8, with a price target of 34;
  • Apache Corporation (APA) - Get Report, down 1 3/16 to 58 13/16, with a price target of 68;
  • Nuevo Energy (NEV) - Get Report, up 3/16 to 18 7/8, with a price target of 23.

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Offerings and stock actions

There are two more IPO casualties of poor market conditions, with

SkyDesk

and

Signal Pharmaceuticals

both withdrawing their offerings. SkyDesk's was a $75 million IPO. It had applied to trade on the Nasdaq under the ticker "DESK." Signal's IPO was for $66 million and had also applied for trade on the Nasdaq. It requested the symbol "SGNL."

Check Point Software

(CHKP) - Get Report

said its board approved a 2-for-1 stock split, effective July 25. The stock bumped up 1 11/16 to 211 3/4.

Exfo

(EXFO) - Get Report

bounded up 17 7/8, or 68.8%, to 43 7/8 on its first day of trading. It said it raised $182 million through its initial public offering of 7 million shares at $26 a share.

Mobility Electronics

(MOBE)

was up 1, or 8.3%, to 13, after it raised $48 million after selling 4 million shares at $12 each, above the expected $9 to $11 range. The lead underwriter was

Deutsche Banc Alex. Brown

. Mobility designs and develops technology and products for the computer industry.

The news that

Plantronics'

(PLT) - Get Report

board approved a 3-for-1 common stock split boosted the stock 9 1/8, or 8.6%, to 115 1/2.

StorageNetworks

(STOR) - Get Report

rocketed up 63 1/4, or a whopping 234%, to 90 1/4. The stock raised $243 million after pricing 9 million shares at $27 in its IPO, above the recently raised price range of $23 to $25.

Goldman Sachs

was the lead underwriter in the deal. StorageNetworks is creating a fiber optic network that will allow companies to store a virtually unlimited amount of data on the Web.

Syntroleum

(SYNM)

said it priced a 5.25 million secondary offering of shares at $17.50 a share. The stock dropped 1 1/4, or 6.8%, to 17 1/8.

Telesystem International Wireless

(TIWI)

crept up 5/16 to 18 1/2. It filed a registration with the

Securities and Exchange Commission

for the $200 million initial public offering of

ClearWave

, its Central/Eastern European subsidiary. Certain existing shareholders in

MobiFon

and all of the minority shareholders in

TIW Czech

will become shareholders of ClearWave. The company applied for its shares to be quoted on the Nasdaq national market.

NTT Communications

extended its tender offer for

Verio

(VRIO)

until 12 a.m. EDT on July 14, 2000. The tender offer had been scheduled to expire today. Verio sunk 4 1/32, or 6.8%, to 55 15/32.

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Miscellany

Broadcom

(BRCM)

will replace

GTE

(GTE) - Get Report

in the

S&P 500 Index after the close of trading today. Broadcom shot up 14 3/16, or 6.9%, to 218 15/16, while GTE was off 1/16 to 62.

Component

Bell Atlantic

(BEL)

, which fell 3/4 to 50 3/4, said this afternoon it completed its purchase of GTE, creating

Verizon Communications

, which will be the No. 1 U.S. local telephone company. The companies said in a statement that Verizon will begin trading on Monday on the

New York Stock Exchange

under the ticker "VZ."

Bell Atlantic said it will spin off GTE's Internet unit,

Genuity

, coinciding with the completion of the merger.

Boeing

(BA) - Get Report

was up 7/8 to 41 13/16 after it unveiled its new 747-400X planes, which have a capacity for over 500 passengers. Boeing said the plane has a range of over 8,975 nautical miles.

Also, Boeing announced it will increase the production rate of its 737s by about 17% beginning in the third quarter of 2001 in reaction to a rise in orders,

The Wall Street Journal

reported. The company said it will make four more 737s a month, upping its output to 28 aircraft.

Did somebody say "lousy ad campaign?"

McDonalds

(MCD) - Get Report

said it was beginning a new ad campaign today, replete with new tagline, "We love to see you smile." The fast food chain got a break today. It rose 1 11/16, or 5.4%, to 32 15/16.

Pharmacia

(PHA)

, up 1 5/16 to 51 11/16, said it would set up a new biotechnology research unit in Sweden.

Pharmacia was started as a new highlighted stock at

PaineWebber

.

SBC Communications

(SBC)

is on the brink of receiving approval from the

Federal Communications Commission

to offer long-distance calling in Texas, which is only the second time a regional Bell telephone company has secured permission to offer customers one-stop shopping for their phone and Internet services. Bell Atlantic was the first, earning that right in New York state.

This was the first time the

Justice Department

has backed a Bell company's attempt to offer long-distance service within its local calling region. Still, the stock finished the day down 2 5/16, or 5.1%, to 43 1/4.

Sunrise Technologies

(SNRS)

was lifted 2 1/2, or 6%, to 44 3/8, on news that it received approval from the U.S. Food and Drug Administration for its Hyperion Laser Thermal Keratoplasty System.

Tap Pharmaceuticals

(ABT) - Get Report

said it planned to withdraw its application for the impotence drug

Uprima

.

The Wall Street Journal

said

Unilever

(UL) - Get Report

filed for approval to launch an initial public offering of its China unit on a Chinese exchange.

If Unilever succeeds, it would pave the way into China's "tightly controlled" capital markets for other foreign companies, the

Journal

said. Unilever was 11/16 higher to 25 1/8.

United Healthcare

(UNH) - Get Report

was down 1/4 to 85 3/4 after it said it would not renew the Medicare+Choice plan in 21 U.S. counties, which will affect 56,000 of its 400,000 customers.

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By the Numbers

The data on NYSE and Nasdaq percent winners and losers are filtered to exclude stocks whose previous day's volume was less than 25,000 shares; whose last price was less than 5; and whose net change was less than 1/2.

Dow point gain and loss data are based on New York closing prices and do not reflect late composite trading.

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