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
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
, 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
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.
was down 2.3 to 6480.0, while the Paris
was 47.49 lower, or 0.9%, to 5215.74. Frankfurt's
was down 75.38, or 1.3%, to 5880.59.
This weekend German telecom and engineering firm
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
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
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
Cable & Wireless HKT
, the latter of which was rising on word that
may bid for parent
Cable & Wireless PLC
In Tokyo, the
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
, publisher of this Web site, has made some changes to two of its indices, effective today.
were added to
TheStreet.com E-Commerce Index
was removed from the index, making the number of components 18 (up from the previous 15).
has replaced the former
in the e-commerce index. Egghead.com's merger with
was completed Friday, whereupon Onsale changed its name to
. The new Egghead.com remains an index component. Got all that?
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
Mergers, acquisitions and joint ventures
agreed to a five-year partnership in which Electronic Arts will deliver online games and interactive entertainment to AOL.
have entered into a credit-card alliance.
is considering a friendly takeover bid for Britain's
Cable & Wireless
is in a pact to merge with
. Digital Insight will exchange 0.579 share for each nFront share. Digital says the current equity value to nFront shareholders is $439 million.
, a unit of
. 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.
Federal Trade Commission
wants the combined
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.
is in the process of acquiring
agreed to buy Britain's
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.
is taking a 43% ownership stake in
. 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.
announced a four-year, $400 million pact with
Earnings/revenue reports and previews
(Earnings estimates are from
First Call/Thomson Financial
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
has set a 2-for-1 stock split.
said its board authorized the company to establish a tracking stock for the media assets of its business.
to intermediate-term buy from accumulate.
Warburg Dillon Read
raised its rating on
to strong buy from buy .
Credit Suisse First Boston
started coverage of
with a strong buy rating.
First Boston restarted coverage of
with a strong buy rating.
First Boston raised its target price on
to 140 from 95.
to intermediate-term accumulate from buy.
to intermediate-term accumulate from neutral.
Three longtime class-action lawyers say they're going to file a class-action suit against
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
antitrust action against the software giant, the
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
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
Magellan fund. Lynch concedes he suffered a "rather significant loss" when he decided to buy shares of
, 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.