Wednesday: Traders Upbeat at the Bell

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By Justin Lahart
Staff Reporter

Traders expect yesterday's rally to extend into this morning.

"With the futures higher, it looks good," says one trader. Traders say that

Seagate's

(SEG)

strong earnings, announced last night, could spark another tech rally. Disk-drive makers helped lead techs out of the doldrums last week.

The

S&P 500

futures are up 2.00. The 30-year Treasury bond is up 8/32 at 94 14/32, pushing the yield down to 7.07%.

Procter & Gamble

(PG) - Get Report

announced that it will buy

Tambrands

(TMB)

for $50 a share, or $1.85 billion. Tambrands has gained more than three points this week. Yesterday it closed at 46 1/8, up 5/8, in very heavy trading.

Pharmacia & Upjohn

(PNU)

said that it had abandoned clinical trials for

Linamide

, a multiple sclerosis drug, after two phase III tests showed "an unexpected incidence" of heart attack.

Bay Networks

(BAY)

announced that it was buying

Isotro Network

for $11 million. Bay said it would take a charge on earnings for the acquisition.

Cytel

(CYTL)

announced restructuring plans. As part of them, the company will spin off its vaccine division.

The usual slew of companies reported earnings before the bell.

Barnett Banks

(BBI) - Get Report

posted first-quarter earnings of 78 cents a share, a penny above

First Call

estimates.

Abbott Labs

(ABT) - Get Report

announced first-quarter earnings of 69 cents a share, a penny over First Call estimates.

Republic Group

(RPG) - Get Report

came in with first-quarter earnings of 40 cents a share, two cents above First Call estimates.

Cellstar

(CLST)

reported first-quarter earnings of 30 cents a share, well ahead of First Call estimates 20 cents.

American Freightways

(AFWY)

reported first-quarter earnings of five cents a share, three cents below estimates.

In Japan, the tug of war continues. On the one hand, international blue chips, which stand to do well with the recent strength of the dollar, are climbing higher. On the other, investors are getting out of banks on concern that the government won't do enough to help them cover their bad real-estate loans. Some days the

Nikkei

is higher, others it's lower. Today it was lower, closing down 318.33 at 17,703.37. What happens if the dollar weakens?

Gains in

HSBC Holdings

helped Hong Kong stocks edge higher. The property sector continues to lag and many investors are reportedly staying on the sidelines until they're more clear on what will happen to U.S. interest rates. The

Hang Seng

closed up 28.11 at 12,426.68.

Wall Street's gains and the strong dollar helped send German shares higher. The

Dax

closed at 3359.46, up 29.69. The usual export-oriented suspects --

Bayer

,

Volkswagen

,

Daimler-Benz

et al -- were among the gainers.

The strength of the U.S. market has helped British stocks shed their pre-election (and, some would say, pre-U.K. rate-hike) funk. The

FTSE

is up 20 at 4293.30.