Yesterday morning, Wall Street was still mired in indecision.
Was the selling over? Did stocks have further to fall? Nobody seemed to know. On the global front, there were still worries over what the final effects of Brazil's tumbling currency might be, and fears of a Chinese devaluation had by no means been laid to rest. As far as U.S. stocks went, they were not as dangerously overextended as they were at their Jan. 8 top, but some people felt that they still needed a bit more air let out of them before they could head higher.
At midday, something changed. Maybe it was
split announcement. Maybe it was a rebound in Brazil's real. Maybe people finally began to believe all those Chinese officials who kept saying that they weren't going to let their currency float this year.
Whatever the cause, investors found reasons to start buying again. And there are more reasons to buy this morning.
There is last night's announcement that
will take out
posted good fourth-quarter earnings this morning. Internet stocks -- the ultimate sentiment measure -- look strong on
better-than-expected earnings and
good earnings and 3-for-1 split. Amazon was bid up 20% in premarket trading. eBay was up 27%.
Meanwhile, over in China, central banker Dai Xianglong finally quashed investors' currency fears. "Both President
have said the renminbi will remain stable, and as the person in charge of the relevant department, I assure you, the renminbi will remain stable," he said. "I think these are official and authoritative views."
All good news for stocks.
"It's a positive day," said Bryan Piskorowski, market analyst at
, who looks for a continuation of yesterday's move. "There's no doubt about it. The market's going to trade higher."
Today, like yesterday, should run the show, led by Compaq and the resplendent Internet stocks.
Stocks were cued to head higher at the bell. At 9 a.m. EST, the
futures were up 2.5, 9 points above fair value, signaling a hop at the open. The expected strength in stocks was putting on the Treasury market. The 30-year was off 8/32 to 101 17/32, lifting the yield to 5.15%.
Stocks in Japan rose again, helped by gains in the tech. The
gained 68.05 to 14,450.06.
Hong Kong investors finally decided that those Chinese devaluation rumors weren't true. The
gained 209.83, or 2.2%, to 9719.66.
European indices were all higher. In Frankfurt, the
was up 108.1, or 2.2%, to 5094.9. In Paris, the
was up 46.95, or 1.2%, to 4118.23. In London, the
was up 5.8 to 5891.5.
Wednesday's Wake-Up Watchlist
- Compaq posted fourth-quarter earnings of 43 cents a share, easily beating the
First Call 32-analyst view of 37 cents and the year-ago 42 cents. Compaq said fourth-quarter sales rose 48% to $10.9 billion. The company said it continues to see strong demand for its products and services and the opportunity for continued market-share gains and revenue growth.
Disney (DIS) - Get Report posted first-quarter earnings of 23 cents a share, excluding a benefit from the acquisition of a 43% interest in
Infoseek (SEEK) , falling short of the 16-analyst First Call consensus by a penny and the year-ago 37 cents. In other Disney news,
yesterday that Disney may bid for
Chancellor Media (AMFM) , setting up a possible takeover battle with the nation's No. 1 radio company.
Mobil (MOB) posted fourth-quarter operating earnings of 62 cents a share, beating the 22-analyst First Call view of 50 cents, but down from the year-ago 99 cents.
In other news (earnings estimates from First Call):
yesterday after the close reported a fourth-quarter loss of 14 cents a share, 4 cents narrower than the 21-analyst view but wider than the year-ago loss of 8 cents.
America Online (AOL) will post second-quarter earnings after the close today. The 31-analyst view has the company earning 14 cents a share.
American General (AGC) posted fourth-quarter earnings of $1.02, beating the 15-analyst consensus of 96 cents and up from the year-ago 88 cents.
Lehman Brothers initiated coverage of
@Home (ATHM) - Get Report with an outperform rating.
AT&T (T) - Get Report unveiled plans to offer customers a single price, single bill and single number for service for both wireline and wireless calling. The package, dubbed
AT&T Personal Network, will be available beginning Jan. 31.
Bell Atlantic (BEL) reported fourth-quarter earnings of 69 cents a share, in line with the 21-analyst view and up from the year-ago 62 cents.
Lehman Brothers initiated coverage of
broadcast.com (BCST) with a buy rating.
eBay posted fourth-quarter earnings of 7 cents a share, 3 cents ahead of the nine-analyst outlook and up from the year-ago 1 cent. The online auctioneer also set a 3-for-1 stock split. Today,
Donaldson Lufkin & Jenrette upgraded the stock to buy from market perform. It bumped its price target on the stock to 360 from 100.
General Dynamics (GD) - Get Report reported fourth-quarter earnings of 75 cents a share, ahead of the 11-analyst estimate of 73 cents and up from the year-ago 65 cents.
Ikon Office Solutions (IKN) posted first-quarter earnings of 13 cents a share, beating the three-analyst view by a penny, but down from the year-ago 33 cents.
Merrill Lynch named
SmithKline Beecham (SBH) - Get Report its Focus One stock of the week.
Yahoo! (YHOO) announced the launch of three new properties in Asia --
Yahoo! Taiwan and
Yahoo! Hong Kong.