With merger news and reports

Microsoft

(MSFT) - Get Report

is willing to talk the talk battling ongoing concerns about tech earnings and

Dow

10,000 disappointment, major proxies were modestly changed this morning.

After opening with a decidedly negative bias, major market proxies were mixed as lunchtime beckoned. The

Dow Jones Industrial Average

was up 14 to 9918 after sliding as low as 9874.97 early on while the

S&P 500

was up 1 to 1301 after declining to as low as 1294.22.

Names helping blue-chip proxies include

Pfizer

(PFE) - Get Report

,

Procter & Gamble

(PG) - Get Report

and

J.P. Morgan

(JPM) - Get Report

.

Conversely, the

Nasdaq Composite Index

was down 11 to 2411, but off its early decline to as low as 2397.95. Meanwhile, the

Russell 2000

was lower by 2 to 394 and the

Dow Jones Transportation Average

was down 54 to 3284, with airline stocks leading the downturn.

IBM

(IBM) - Get Report

had been a big deterrent early on amid continuing speculation it will post disappointing first-quarter earnings, or warn thereof. But lately Big Blue was off only fractionally.

"IBM on

Friday had some cross-currents with

Morgan Stanley

Dean Witter

negative and

Merrill Lynch

positive," said Jim Herrick, head of stock trading at

Robert W. Baird

in Milwaukee. "I think institutions are starting to filter out whether they'll meet the revenue number, but you're going to have tug of war until you get a clearer picture."

Meanwhile,

Bear Stearns

threw its hat in the PC outlook-ring

today.

Despite IBM's turnaround, nervous tech investors were shaken further today by a report from

Donaldson Lufkin & Jenrette

which speculated

Compaq

(CPQ)

will preannounce an earnings shortfall. The DLJ comment came in a report in which analyst Kevin McCarthy reduced his first-quarter earning estimates on

Dell

(DELL) - Get Report

.

In reaction, Compaq lately was down 2% and Dell was off 6.7%. In sympathy,

Intel

(INTC) - Get Report

was off 2.6%; the

Nasdaq 100

was down 0.6% and the

Philadelphia Stock Exchange Semiconductor Index

was off 2.1%.

Microsoft was struggling to prevent a bigger decline for tech proxies. The software giant was recently up 1.2% at 173 3/8, although down from an earlier high of 174 5/8, after confirming

Wall Street Journal

reports that it is discussing a settlement of its antitrust trial with the

Justice Department

.

While traditional tech bellwethers struggle, Internet stalwarts are pushing higher, led again by

American Online

(AOL)

. AOL was lately up 6.9% and on track to extend a seemingly endless string of new 52-week high closes. In response,

TheStreet.com Internet Sector

index was on track to extend its string of record closes to two, lately up 11 to 640. However,

TheStreet.com E-Commerce Index

was off 1 to 116.

Elsewhere in Netland,

broadcast.com

was up 33% amid rumors it will receive a takeover offer from

Yahoo!

(YHOO)

, lately up 1.2%.

"I think the focus continues to be on the tech stocks and the long-bond yield and any preannouncement we might have heading into first-quarter numbers," Herrick said. "I think you're also seeing some money flowing into some Internet names because you're seeing more talk of mergers and consolidation. It's an area fund managers can't ignore, particularly as these companies consolidate and get larger. They want to be in this area. They want explosion and there's almost more fear of not being invested."

In NYSE trading, declining stocks were leading advancers 1,668 to 1,155 on 386 million shares. In

Nasdaq Stock Market

activity, losers were leading winners 2,145 to 1,518 on 520 million shares.

The price of the 30-year Treasury bond was up 9/32 to 95 25/32, its yield dipping to 5.54%. (For more on the fixed-income market, see today's early

Bond Focus.)

"We still have a fragmented tech sector," said Brian Belski, chief investment strategist at

George K. Baum

in Kansas City, Mo. "Last week we had a nice week in the Nasdaq, but that's because some stocks that had been down bounced up. Now we're back to reality. That reality is the trend of the prior week, when boxmakers and manufacturers -- Intel,

Gateway

(GTW)

and now Dell -- struggled and the service providers,

such as AOL and Microsoft, rising to the forefront. I look for that part of tech to stay strong."

Belski sees better times ahead (and soon) for the broader market, especially because of the rising skepticism in wake of the Dow's failed run at 10,000 last week, which he dubbed "more psychological than trend."

"Look at it as if you're a money manager," the strategist said. "You start hearing all this stuff about Y2K and everyone thinking the second and third quarters are going to be bad. So you look at you numbers for the first quarter and figure as long as everyone is saying it's a foregone conclusion the market is going to be down, let's get it while we still can."

With only eight trading days left before the end of the first quarter, Belski expects money managers to "try to run it up and pad

their numbers," much as they have done at the end of positive quarter in recent history, citing the fourth and second quarters of last year.

The strategist foresees the Dow hitting "at least" 10,300 to 10,500 by quarter's end, with the S&P 500 touching 1350 while the Nasdaq "continues to lag." As for the Russell 2000, "there's not anything to kick-start small-caps," he said.

This weekend's

TSC

Investor Sentiment Poll found a plurality of respondents -- 30% -- calling themselves somewhat bullish. Somewhat bearish garnered 28%, with 23% neutral, 10% very bullish and 9% very bearish. The anecdotal poll is conducted each Sunday.

Monday's Midday Movers

By Heather Moore
Staff Reporter

As mentioned earlier, Dell was down 2 11/16, or 6.7%, to 37 9/16 after Donaldson Lufkin & Jenrette lowered its first-quarter revenue estimate for the PC maker to $5.3 billion from $5.5 billion. DLJ, which maintained its market-perform rating on Dell, slashed its first-quarter earnings estimate to 15 cents a share from 17 cents and its full-year view to 72 cents from 75 cents. A 30-analyst

First Call

consensus calls for quarter earnings of 16 cents, vs. the year-ago 11 cents, and a 31-analyst consensus calls for 2000 earnings of 73 cents, vs. the year-ago 53 cents.

In other news:

Also as noted above, broadcast.com was flying 28 1/8, or 33%, to 113 1/4 on a

Business Week Online

report saying Yahoo! might buy the company. Yahoo! was up 2 to 171 5/8. America Online and

General Electric's

(GE) - Get Report

NBC

were also said to be separately considering a takeover of broadcast.com. GE was down 9/16 to 111 7/16. America Online was up 8 5/16, or 6.9%, to 127 1/2 after

ING Baring Furman Selz

raised its price target for the company to 180 from 100 a share. The firm also lifted its 1999 earnings estimate for AOL to 36 cents a share from 32 cents.

CHS Electronics

(HS)

was down 2, or 33.3%, to 4 after reporting revised fourth-quarter earnings of 23 cents a share compared with 45 cents a year ago. The results were far lower than the 47 cents announced Feb. 24.

Credit Suisse First Boston

dropped the stock to hold from buy.

Documentum

(DCTM)

was down 2 1/2, or 13.1%, to 16 11/16 after Credit Suisse First Boston lowered it to hold from buy, saying Paul Hoffman, the company's vice president of sales, is leaving the company to become CEO of a start-up.

Gilead Sciences

(GILD) - Get Report

was down 9 15/16, or 17.3%, to 47 after both Merrill Lynch and

PaineWebber

lowered the stock to neutral from accumulate. A conference call with Gilead late Friday afternoon discussing the kidney toxicity of the company's AIDS and hepatitis drug,

Preveon

, exacerbated recent concerns.

MediaOne

(UMG)

was up 6 3/16, or 10.2%, to 66 15/16 after

Comcast

(CMCSK)

agreed to buy the company in a deal valued at $60 billion in stock and the assumption of debt. MediaOne shareholders will receive 1.1 Comcast shares for each share owned. While the agreement bars MediaOne from soliciting competing acquisition proposals, it has 45 days to accept a superior proposal, subject to payment of a $1.5 billion fee to Comcast, lately off 7 1/16, or 9.7%, to 65 7/8.

Senior Writer Jesse Eisinger contributed to Monday's Midday Movers

.