One minute the head of the

New York Stock Exchange

is throwing


10,000 hats (a bit prematurely) on to the floor, and the next waves of


are taking off from airfields in Europe.

It is almost uncanny that when stocks start to get a little stretched, when traders start talking about how the market has run ahead of itself, some outside event comes knocking. If times were different, if the market weren't knocking on a milestone that finally made people think about how far it has gone, and how rich valuations have gotten, would trouble in Serbia really be hurting the market like it did yesterday? Just to put some perspective on it, the thing that is getting the wood in

The New York Post

this morning is not airstrikes, but a story on how the New York City police commissioner got flown to the


on the


(REV) - Get Report

corporate jet.

This is not meant to diminish the seriousness of what's going on: It's deadly serious. But recall that when bombs fell on Baghdad on Dec. 16, stocks paused and then ran higher.

"People have trying to link any military action with global instability for a while, but that part of the world has been unstable through the whole bull market," said Dan Mathisson, head stock trader at

D.E. Shaw Securities


Stocks look weak this morning, but not as weak as they did earlier. Two things have happened to improve the outlook. One is that February

durable goods orders

slumped 5% -- economists had expected them to drop 2%. That's helped boost the Treasuries. At 9 a.m. EST, the long bond was up 11/32 to 95 29/32, dropping the yield to 5.53%.

The other thing is that

Goldman Sachs


Abby Joseph Cohen

has come out with some positive comments on the market this morning. "We expect 1999 and 2000 to be years of ongoing profit expansion, with better aggregate gains than 1998," wrote Cohen in a morning note. She also revised her year-end

S&P 500

price target to 1325 from 1275-1300 and her Dow target to 10,300 from 9850.

"Every time the market dips, she's out the next morning," said Mathisson. "Those have usually been good buying opportunities." Still, he noted that the bullish Cohen's remaining bullish is "not really news."

The bid in Treasuries and the Cohen comments helped moved the S&P 500 futures into the plus column. Lately, they were up 1.3. That's still a bit below fair value, indicating some weakness on the open.

The trouble on Wall Street yesterday roiled Japanese stocks. The


fell 503.63, or 3.1%, to 15,515.47.

Hong Kong stocks took some lumps as well. The

Hang Seng

dropped 329.67, or 3%, to 10,711.34.

Europe's major bourses were all sharply lower. In Frankfurt, the


was off 133.17, or 2.7%, to 4781.86. In Paris, the


was down 54.43, or 1.3%, to 4025.04. And in London, the


was off 43.8 to 6016.7.

Wednesday's Wake-Up Watchlist


Brian Louis

Staff Reporter

  • IBM (IBM) - Get Report and corporate data storage equipment supplier EMC (EMC) set a five-year strategic alliance valued at $3 billion. Under the technology and business deal, EMC will continue to purchase Big Blue disk drives to be incorporated into its Symmetrix Enterprise Storage systems. Also, in the future, the pact is likely to include other IBM technologies, such as microprocessors and advanced custom chips. The agreement also provides for a broad patent cross-license between the two companies for storage and other technologies.
  • 3Com (COMS) after the close posted third-quarter earnings of 24 cents a share, 1 cent ahead of the 24-analyst First Call consensus and above the year-ago 4 cents. In other news (earnings estimates from First Call):
  • Dean Foods (DF) - Get Report posted third-quarter earnings of 20 cents a share, excluding a charge, in line with the 11-analyst estimate but down from the year-ago 44 cents.
  • Morgan Stanley Dean Witter upgraded Burlington Industries (BUR) to outperform from neutral. Merrill Lynch named Burlington Resources (BR) - Get Report its Focus One stock of the week.
  • Donna Karan (DK) - Get Report posted a fourth-quarter loss of 15 cents a share and better than a loss of $3.17 from the year-ago period.
  • Morgan Stanley downgraded Ericsson (ERICY) to underperform from neutral.
  • Knoll's (KNL) - Get Report board said it has received a proposal from Warburg Pincus Ventures and Knoll management, which together currently own 60% of Knoll's outstanding shares, to acquire the rest of the shares they don't own for $25 a share. Shares of Knoll closed yesterday at 15 1/4.
  • Network Solutions (NSOL) , the company that registers Internet domain names like ".com," ".net" and ".org," which is losing its government-granted monopoly, could in the short run continue to grow, unless a big company -- like America Online (AOL) , AT&T (T) - Get Report or MCI WorldCom (WCOM) -- enters the domain-naming business, the Heard on the Street column in The Wall Street Journal reports.
  • Vignette (VIGN) named Joel Katz chief financial officer, effective April 6.

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