It's hard to dig pessimism out of this morning's news.
beat analysts' earnings estimates by 4 cents;
is up almost 15 points in premarket trading; and European shares rallied sharply, led by the telecommunications and technology names.
futures were about 11 points above fair value, indicating a strong opening for stocks.
AT&T reported first-quarter operating earnings of 61 cents a postsplit share, beating Wall Street estimates of 57 cents. This figure doesn't include one-time items, though it does account for Ma Bell's 1998 acquisition of
. AT&T was reportedly trading about 2 points higher ahead of the open.
The Wall Street Journal
reported this morning that
is in preliminary discussions to align itself with either
to counter AT&T's $54 billion cash-and-stock bid for
. Comcast previously offered $48 billion in stock.
Internet stocks were looking stronger as well on
. Online auctioneer eBay, which reported earnings of 5 cents a share last night vs. expectations for 2 cents a share, was trading at 230 after closing at 209 1/8 yesterday. AOL, which is expected to report earnings of 9 cents a share later today, was also higher.
"Everything looks strong now, particularly the
stocks," said Dan Mathisson, head stock trader at
. eBay has "become one of the new bellwether stocks. When a stock like eBay releases, it can actually affect the broader market, which is definitely the case this morning."
Major European bourses were all higher, led by France's
, up 108.01, or 2.5%, to 4392.41. The German markets moved sideways for the early part of the session but have lately rallied. The
was up 101.63, or 1.9%, to 5351.85. In London, the
was up 122.8, or 1.9%, to 6626.4.
Japanese stocks traded a bit tentatively in anticipation of the beginning of the Golden Week holiday this Thursday. The blue-chip
once again flirted with but failed to attain 17,000, closing up 38.76 to 16,957.27. The
closed up 237.77, or 1.8%, to 13,364.79.
Treasuries, which eked out a rally in late trading yesterday, were flat this morning. Lately the 30-year bond was up 3/32 to trade at 95 11/32, yielding 5.57%.
There are two monthly economic releases today, but neither is likely to move the stock market. The
releases its monthly index of
at 10 a.m., and the
National Association of Realtors
will weigh in on March
sales of existing homes
at the same time.
Tuesday's Wake-Up Watchlist
- Comcast is considering the idea of linking up with Microsoft or America Online in an arrangement that could advance those companies' ambitions in digital television and high-speed Internet access, while buoying Comcast's position in the bidding war for MediaOne,
The Wall Street Journal reported. The newspaper said the talks are very preliminary and are among a number of possibilities being considered by Comcast, which is trying to beat AT&T's unsolicited bid to buy MediaOne.
AT&T posted first-quarter operating earnings of 61 cents a share, including the impact of the March 9
TCI acquisition. The
First Call 18-analyst estimate predicted earnings of 57 cents.
Meanwhile, AT&T and Japan's
Nippon Telegraph & Telephone (NTT) agreed to team up in the global network solutions business.
Park Place Entertainment (PPE) is buying
Caesars World and other gaming assets from
Starwood Hotels & Resorts Worldwide (HOT) for a total of $3 billion in cash. The sale excludes the
Desert Inn in Las Vegas. The deal was first reported by
In other news (earnings estimates from First Call):
Goldman Sachs upgraded
Apple (AAPL) - Get Report to its recommended list from market perform.
Amazon.com (AMZN) - Get Report said yesterday it was acquiring three e-commerce companies for about $645 million in stock.
Chubb (CB) - Get Report reported first-quarter operating earnings of $1.02 a share, beating the 13-analyst estimate, but down from the year-ago $1.10.
Disney (DIS) - Get Report said second-quarter net income was 13 cents a share, which excludes its acquisition of a 43% stake in
Infoseek (SEEK) , in line with the 19-analyst estimate, but down from the year-ago 18 cents.
Dollar General (DG) - Get Report set a 5-for-4 stock split.
HealthSouth (HRC) - Get Report posted first-quarter earnings of 26 cents a share, a penny ahead of the nine-analyst estimate and unchanged from the year-ago period.
Louisiana Pacific (LPX) - Get Report reported first-quarter earnings of 26 cents a share, beating the 10-analyst estimate of 19 cents and up from the year-ago loss of 23 cents.
Northern Telecom (NT) posted first-quarter operating earnings of 33 cents a share, in line with the 22-analyst estimate and up from the year-ago 27 cents.
Phillips Petroleum (P) reported first-quarter operating earnings of 7 cents a share, beating the 23-analyst estimate of a penny a share, but down from the year-ago operating net of 65 cents.
Texaco (TX) - Get Report reported first-quarter operating earnings of 18 cents a share, beating the 21-analyst estimate by a penny, but down from the year-ago operating earnings of 46 cents.
Toys R Us (TOY) said it was establishing a separate
toysrus.com unit in a strategic partnership with
Benchmark Capital, a Silicon Valley venture-capital firm. The company also said it was acquiring a 500,000 square-foot, fully automated distribution center in Memphis, Tenn.
United Rentals (URI) - Get Report reported first-quarter earnings of 18 cents a share, beating the 13-analyst estimate of 16 cents and up from the year-ago 11 cents.
eBay yesterday posted first-quarter earnings of 5 cents a share, 3 cents ahead of the 10-analyst forecast and above the year-ago penny. eBay said quarterly revenue jumped to $34 million from $6 million.