Despite the disappointment engendered by yesterday afternoon's selling, to look at the

S&P 500

futures, stocks look like they will edge higher at the open.

At 9 a.m. EST, they were up 0.5. That puts them nearly 3 points above fair value, indicating a positive open. But this is not enough to make people particularly happy about the stock market.

"Why are the futures up? I don't know," said Todd Clark, head of listed trading at

Charles Schwab

. "Yesterday's reversal -- I didn't like it. And I don't like the action in tech stocks."

Yesterday, Clark points out, was the second time in a week the market produced what technicians call an outside day -- a day when stocks made higher highs and lower lows than the previous day. It doesn't help that on both days -- yesterday and last Wednesday -- stocks closed on the low side. "That suggests that market has some more risk to it," he said.

Moreover, the market is again nearing some major support levels -- 1205 to 1211, if you're looking at the S&P.

"We're at a pretty important juncture here," said Clark. "The market is going to have to show us something to hold together."

At least the Treasury market looks like it's reached some modicum of stability. The 30-year was up 1/32 to 94 23/32, putting the yield at 5.61%.

Tokyo stocks took back most of yesterday's losses, with nearly half the gains made in the last 15 minutes of trading. That was when the

Bank of Japan

let loose another raft of cash into the interbank lending market, pushing the key uncollateralized overnight call rate -- what banks charge each other for unsecured short-term loans -- to a new low of 0.02%. It marked the sixth day that the BOJ pushed excess reserves in the money market higher.

The dollar hopped on the news, and the yield on the benchmark 10-year government bond slipped 0.115% to 1.69%. Both actions are supportive for stocks. The

Nikkei

ended the day up 249.3, or 1.8%, to 14,170.36.

Hong Kong stocks chopped around a lot as traders hung on Financial Secretary

Donald Tsang's

every word as he gave his annual budget speech. Tsang said that the government would cut its stock holdings and up the tax on property sales (negatives for stocks), but he confirmed that the government is in talks with

Disney

(DIS) - Get Report

on launching a theme park (stock supportive). The

Hang Seng

ended the day up 8.82 to 9,922.40.

A mixed picture in Europe. In Frankfurt, the

Dax

was off 44.08 to 4759.94. In Paris, the

CAC

was up 8.37 to 4057. Though there was some disappointment in London that the

Bank of England

did not cut rates this morning, traders appear to have gotten over it. The

FTSE

was up 34.1 to 6095.4.

Wednesday's Wake-Up Watchlist

By

Brian Louis

Staff Reporter

Monsanto

(MTC) - Get Report

is in merger negotiations with

DuPont

(DD) - Get Report

, the

New York Times

reported, citing execs who say they've been briefed on the talks. Robert Shapiro, Monsanto's chief executive, has been searching for a way for Monsanto to be acquired by DuPont and still retain its special character and habits with its own compensation and incentive programs and possibly its own stock, the

Times

reported, citing the executives. The execs said the talks are still at a preliminary stage and may go no further, the

Times

said.

RJR Nabisco

(RN)

is expected to announce the total or partial disposal of its international tobacco business within 10 days, which could value the division at about $6 billion, the

Financial Times

reported.

Jones Apparel

(JNY)

is buying

Nine West

(NIN)

for $885 million in cash and stock. Jones Apparel will also assume $515 million in Nine West debt.

Allstate Life

, a subsidiary of

Allstate Insurance

(ALL) - Get Report

, and mutual fund giant

Putnam Investments

announced a joint venture to provide new variable insurance products. Under the agreement, Allstate Life and Putnam will focus on jointly creating and distributing a co-branded variable insurance product line.

In other news (earnings estimates are from

First Call

):

Merrill Lynch

named

CBS

(CBS) - Get Report

its Focus One stock of the week and put a price target of 50 on the stock. It closed yesterday at 36 11/16.

Cyberian Outpost

(COOL)

sees fourth-quarter revenue of $33 million, up 307% from the year-ago period and up 40% vs. the third quarter.

Dell

(DELL) - Get Report

plans to introduce today an online megastore where it will sell its personal computers along with hawking 30,000 electronics products from other firms.

Intimate Brands'

(IBI)

February same-store sales rose 11%.

Kmart

(KM)

posted fourth-quarter earnings of 65 cents a share, beating the 16-analyst view of 61 cents and up from the year ago 50 cents. Kmart's February same-store sales also rose 5.8%.

Maxxim Medical

(MAM)

posted first-quarter earnings of 40 cents, excluding charges, shy of the three-analyst view of 42 cents and up from the year-ago 37 cents.

Brokerage firm

PaineWebber

(PWJ)

said it acquired a 25% equity stake in

Kingland Companies

, parent of

Kingland Systems Corporation

, a developer of Internet-based solutions for the financial-services industry. Terms weren't disclosed. Mason City, Iowa-based Kingland, develops and markets a range of browser-based solutions for the brokerage, insurance and banking industries.

Philips Electronics

(PHG) - Get Report

is preparing a full-blown proxy fight for

VLSI Technology

(VLSI)

if the semiconductor maker doesn't enter into negotiations,

The Wall Street Journal

reported, citing people familiar with the matter. On Friday, Philips made an unsolicited offer for VLSI totaling $777 million, or $17 a share.

3Com

(COMS)

warned it sees third-quarter operating earnings of 23 cents a share because of seasonal weakness and a slowdown in U.S. and Latin American markets. The 26-analyst outlook called for the network equipment maker to earn 36 cents.

Tiffany

(TIF) - Get Report

posted fourth-quarter earnings of $1.49 a share, beating the 16-analyst view of $1.42 and up from the year-ago $1.17.

As originally published, this story contained an error. Please see Corrections and Clarifications

.