Opening Picture Mixed for Stocks Today

The S&P 500 futures are pointing lower, while crude oil continues to surge.
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It looks like we'll see some selling when the stock market opens today.

No big surprise there, given the market's recent performance. From here, stocks will have to do some serious huffing and puffing to extend what's starting to look like an early visitation of the year-end rally that so many observers were predicting. Sentiment is strong to the point of complacency right now on Wall Street, with the

Chicago Board Options Exchange's

volatility index, which measures fear in the options market, closing below 20 Friday for the first time since July 19.

Incidentally, that was the last time the

S&P 500

was buzzing at record levels. In retrospect, it was also the beginning of this summer's selloff.

To say that we're on the verge of a correction might hyperextend the parallel. But a bit of a pullback sometime soon would certainly make sense. That's what we're looking at this morning: At 9:03 a.m. EST, the S&P 500 futures were down 4.3, about 4 points below fair value and indicating an inclination toward the downside.

To the extent that the market is able to rotate money, that might not be such a bad thing for the stocks outside the radar of the major benchmarks. "Everybody's been playing the same numbers for the last year, buying the same stocks," said Lance Zipper, managing director of trading at

Brean Murray Foster Securities

. "People are starting to reach out to groups that have been beaten up. Some highflyers have reached some lofty levels, and the big accounts are looking for ideas to get into other types of industries."

Still, the major indices, and especially the

Nasdaq Composite Index

, will be getting some good lift this morning from

Microsoft

(MSFT) - Get Report

, which was lately up 4 1/2 to 90 1/2 in premarket trading on Friday's news that Judge Thomas Penfield Jackson has appointed a mediator for the antitrust case.

No major economic data are scheduled for today. That's fine with the bond market, which has enough to do with watching the price of crude oil continue to spike. Iraq's rejection of a

United Nations

plan to extend its humanitarian "oil-for-food" deal this weekend has market participants worried about a possible supply disruption. January crude futures were lately up 68 cents to $26.82.

The 30-year Treasury wasn't enjoying the strength in oil. It was down 16/32 to 98 31/32, putting its yield at 6.201%.

The large European bourses were fading fast in early afternoon trading after opening mixed to higher.

London's

FTSE

was down 2.3 to 6480.0, while the Paris

CAC

was 47.49 lower, or 0.9%, to 5215.74. Frankfurt's

Xetra Dax

was down 75.38, or 1.3%, to 5880.59.

This weekend German telecom and engineering firm

Mannesmann

has rejected

Vodafone AirTouch's

(VOD) - Get Report

record $128 billion takeover offer, with Chairman Klaus Esser significantly saying, "If there is another offer that is good enough, we would recommend it." Perhaps just as significantly, Germany Chancellor

Gerhard Schroder

said over the weekend that he is "very disturbed" by the bid.

The euro firmed slightly overnight from the $1.029 level, and was lately trading at $1.031.

Asian markets boomed higher in an impressive extension of their recent strength. Hong Kong's

Hang Seng

added 211.93, or 1.4%, to 15,285.03, its highest closing level in more than two years. The gains were anchored by telecom stocks, led by index constituent

China Telecom

and

Cable & Wireless HKT

, the latter of which was rising on word that

Deutsche Telekom

(DT) - Get Report

may bid for parent

Cable & Wireless PLC

.

In Tokyo, the

Nikkei

advanced 251.28, or 1.4%, to 18,822.12, a level it hasn't seen since August of 1997. Volume was modest ahead of tomorrow's Labor Thanksgiving Day holiday, which will close Tokyo markets.

The dollar softened slightly against the yen in Tokyo trading, moving from 106.5 yen toward 106 yen. The greenback continued sinking in London, and was lately quoted at 105.00 yen.

Changes to TSC's E-Commerce and E-Finance Indices

TheStreet.com Inc.

(TSCM)

, publisher of this Web site, has made some changes to two of its indices, effective today.

barnesandnoble.com

(BNBN)

,

drugstore.com

(DSCM)

,

priceline.com

(PCLN)

and

Ticketmaster Online-CitySearch

(TMCS)

were added to

TheStreet.com E-Commerce Index

.

E4L

(ETV) - Get Report

was removed from the index, making the number of components 18 (up from the previous 15).

eToys

(ETYS)

has replaced the former

Egghead.com

in the e-commerce index. Egghead.com's merger with

Onsale

was completed Friday, whereupon Onsale changed its name to

Egghead.com

(EGGS)

. The new Egghead.com remains an index component. Got all that?

TheStreet.com added

DLJdirect

(DIR)

,

TD Waterhouse

(TWE)

and

Wit Capital

(WITC)

to

TheStreet.com E-Finance Index

, raising the number of components to 14 from 11.

For more information about these indices, please see

Frequently Asked Questions About the TSC E-Commerce Index and

Frequently Asked Questions About the TSC E-Finance Index.

--

John J. Edwards III

Monday's Wake-Up Watchlist

By

Eileen Kinsella

and

Brian Louis

Staff Reporters

Mergers, acquisitions and joint ventures

America Online

(AOL)

and

Electronic Arts

(ERTS)

agreed to a five-year partnership in which Electronic Arts will deliver online games and interactive entertainment to AOL.

Beyond.com

(BYND) - Get Report

and

NextCard

(NXCD)

have entered into a credit-card alliance.

Deutsche Telekom

(DT) - Get Report

is considering a friendly takeover bid for Britain's

Cable & Wireless

(CWP)

, the

Sunday Business

newspaper reported.

Digital Insight

(DGIN)

is in a pact to merge with

nFront

(NFNT)

. Digital Insight will exchange 0.579 share for each nFront share. Digital says the current equity value to nFront shareholders is $439 million.

Efficient Networks

(EFNT)

is acquiring

FlowPoint

, a unit of

Cabletron Systems

(CS) - Get Report

. Under terms of the deal, Cabletron will receive 7.3 million shares of common and 6.2 million shares of nonvoting convertible preferred stock of Efficient in exchange for all of the outstanding capital stock of FlowPoint. Based on Friday's closing price for Efficient of 63 3/4, the deal is valued at about $861 million, Efficient said.

The

Federal Trade Commission

wants the combined

Exxon Mobil

to sell more than 1,700 gasoline stations in Northeastern, mid-Atlantic and West Coast states,

The Wall Street Journal

reported, citing people familiar with the talks.

Exxon

(XON) - Get Report

is in the process of acquiring

Mobil

(MOB)

.

JDS Uniphase

(JDSU)

agreed to buy Britain's

SIFAM

for about $97.2 million payable in cash. The acquisition is made in the form of an offer to SIFAM security holders and that holders of over 90% of the company's shares have executed binding agreements to accept the JDS Uniphase offer unconditionally.

SBC Communications

(SBC)

is taking a 43% ownership stake in

Prodigy Communications

(PRGY)

. The companies have agreed to join their consumer and small-business Internet operations. Under terms of the deal, SBC will make Prodigy its exclusive retail consumer and small-business Internet access service to the roughly 100 million Americans in its service area, while Prodigy will assume management of SBC's current 650,000 dial-up, ISDN and basic DSL Internet customer base.

Sycamore Networks

(SCMR)

announced a four-year, $400 million pact with

Williams Communications

(WCG) - Get Report

.

Earnings/revenue reports and previews

(Earnings estimates are from

First Call/Thomson Financial

.)

Medtronic

(MDT) - Get Report

reported second-quarter earnings of 22 cents a share, in line with the 30-analyst estimate and up from the year-ago 18 cents a share.

Offerings and stock actions

Unify

(UNFY)

has set a 2-for-1 stock split.

Excite@Home

(ATHM) - Get Report

said its board authorized the company to establish a tracking stock for the media assets of its business.

Analyst actions

Merrill Lynch

upgraded

Coca-Cola

(KO) - Get Report

to intermediate-term buy from accumulate.

Warburg Dillon Read

raised its rating on

Eclipsys

(ECLP)

to strong buy from buy .

Credit Suisse First Boston

started coverage of

InterTrust Technologies

(ITRU)

with a strong buy rating.

First Boston restarted coverage of

Phone.com

(PHCM)

with a strong buy rating.

First Boston raised its target price on

STMicroelectronics

(STM) - Get Report

to 140 from 95.

Merrill downgraded

Time Warner

(TWX)

to intermediate-term accumulate from buy.

Merrill upgraded

Walgreen

(WAG)

to intermediate-term accumulate from neutral.

Miscellany

Three longtime class-action lawyers say they're going to file a class-action suit against

Microsoft

(MSFT) - Get Report

today on behalf of millions of Californians,

The New York Times

reported. The move is the first of what legal experts say could become a torrent of private litigation springing from the

Justice Department's

antitrust action against the software giant, the

Times

said. Meanwhile on Friday, U.S. District Court Judge Thomas Penfield Jackson appointed Judge Richard Posner, chief judge of the 7th U.S. Circuit Court of Appeals, to mediate the case.

The Heard on the Street column in

The Wall Street Journal

examines a not-so-successful personal stock pick by

Fidelity's

Peter Lynch, famous for his "buy what you know" stock-picking philosophy and 2,703% total return in a 13-year run as head of the mammoth

(FMAGX) - Get Report

Magellan fund. Lynch concedes he suffered a "rather significant loss" when he decided to buy shares of

Maxim Group

(MXG)

, a carpet and flooring retailer, for his personal account. Shares dropped 76% since hitting a peak of 25 5/8 in early January. Lynch, who won't say how many shares he owns, says, "I've had a lot worse stocks in my life," according to the story.