It was tough to find a sector that wasn't taking it on the chin at midday, but financial stocks were getting hit particularly hard. Among the biggest losers on the Big Board were Lehman Brothers (LEH) down 11 1/8, or 12%, to 81 3/4 and American Express (AXP) - Get Report which was sliding 8 9/16, or 5.9%, to 137 7/16. The American Stock Exchange Broker/Dealer Index tumbled 43.5, or 9%, to 439, while the Philadelphia Stock Exchange/KBW Bank Index was down 42.47, or 5.3%, to 766.76.

Quest Diagnostics

(DGX) - Get Report

rose 1 5/16 to 44 after it said it expects first-quarter earnings to be about 50% above analyst estimates of 24 cents a share and 2000 year earnings to be about 20% above estimates of $1.47 a share.

Mergers, acquisitions and joint ventures

Honeywell's

(HON) - Get Report

Thermal Systems

business enterprise is buying Britain's

Serck Heat Transfer

for an undisclosed amount. Honeywell fell 13/16 to 54 11/16. Serck is a supplier of heat transfer equipment for cooling engines, transmissions, turbines, compressors and processes in the marine, power generation, construction and automotive industries.

Lehman Brothers

raised Honeywell's 12-month price target to 100 from 80.

PlayCore

(PCO)

, a playground equipment maker, popped 2 5/8, or 38.9%, to 9 3/8 after it said it is being bought out by an investment group for $10.10 a share in cash.

Earnings/revenue reports and previews

(

Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified.

)

Boise Cascade Office Products

(BOP)

was unchanged at 16 3/8 after it posted first-quarter earnings of 31 cents, two cents shy of the two-analyst estimate of 33 cents

Gateway

(GTW)

reported gained 1 to 53 after it said first-quarter earnings of 41 cents a share, in line with the 22-analyst estimate and up from the year-ago 31-cent profit. The PC seller said that a 27% increase sales in its consumer computer unit made up for a slowdown in its business division, which suffered a 19% loss in sales.

According to CFO John Todd, the business division's sales have shown progress every month since its January low. Todd told investors that he sees a seasonal drop in sales during the second quarter but assured that the Gateway is on track to post second-quarter earnings in line with the 21-analyst estimate of 36 cents a share and the fiscal 2000 22-analyst estimate of $1.83 a share.

Merrill Lynch

upgraded Gateway to intermediate-term accumulate from intermediate-term neutral and maintained its long-term accumulate rating on the computer maker.

Global Marine

(GLM)

rose 1/16 to 22 3/16 after it reported first-quarter earnings of 7 cents a share, a penny better than the 31-analyst estimate but down from the year-ago earnings of 21 cents.

Hertz

(HRZ)

, the world's largest car rental company, fell 3 1/4, or 8.7%, to 34 1/16 after it reported first-quarter earnings of 52 cents a share, 4 cents ahead of the nine-analyst estimate and up from the year-ago 45 cents. Hertz's revenue for the quarter totaled $1.135 billion in the first quarter, a jump of 9.9% from the year-ago $1.033 billion.

Hudson United Bancorp

(HU)

lost 1/2 to 20 after it reported first-quarter earnings of 58 cents a share, below the single-analyst estimate of 60 cents but up from the year-ago 53 cents a share.

National City

(NCC)

lost 1 5/16, or 6.5%, to 18 13/16 after it posted earnings of 53 cents a share, below the 20-analyst estimate of 50 cents and in line with the year-ago earnings.

Pulitzer

(PTZ)

rose 5/8 to 41 1/16 after it posted first-quarter earnings from continuing operations of 45 cents a share, above the two-analyst estimate of 40 cents and up from the year-ago operating earnings of 35 cents.

Sun Microsystems

(SUNW) - Get Report

was falling 2 1/4 to 80 after it

posted third-quarter earnings of 26 cents a share, topping the 20-analyst estimate of 23 cents and the year-ago report of an 18-cent profit. CEO Scott McNealy attributed the strong results to a boost in market share after cruising through Y2K woes to see an rise in business during its second quarter.

During the quarter, Sun saw revenue shoot up 35% to hit $4 billion. According to CFO Michael Lehman, the company holds more than $5 billion in cash and securities. Lehman Brothers raised its earnings estimate for fiscal 2000 on Sun to 96 cents from 91 cents.

Prudential Securities

upgraded shares of Sun Microsystems,

CNBC

reported.

Tribune

(TRB)

, slipped 1/16 to 37 13/16 after the newspaper and media giant, which is buying

Times Mirror

(TMC)

, posted first-quarter earnings, excluding items, of 32 cents a share, in line with the 10-analyst estimate and up from the year-ago 27 cents.

Offerings and stock actions

Certicom

(CERT)

, citing poor market conditions, has withdrawn a planned common share offering. At the mid day mark, Certicom had not began trading.

Ford

(F) - Get Report

climbed 3/8 to 54 13/16 after it announced that its board approved several moves designed to make shareholders smile, including

spinning off its automotive components and systems unit

Visteon

, whereby Ford will distribute its 100% interest in Visteon to Ford common and Class-B shareholders.

Shareholders will receive a distribution of Visteon stock based on the number of Ford shares they own and the total number of Ford shares outstanding on the distribution record date. Ford said Visteon generates $19 billion in annual revenue.

Ford's board also approved a plan under which Ford stockholders will exchange their current Ford common and Class-B shares for new Ford common and Class-B shares, and shareholders will have the right to receive either $20 in cash per share or new Ford shares of equivalent value. Ford said the total cash distribution will be limited to $10 billion.

McMoRan Exploration

(MMR)

was falling 1/8 to 13 7/8 after it priced a 3.8 million-share offering at $14 each.

Thoratec

(THOR) - Get Report

was slipping 5/8, or 6.1%, to 9 5/8 after it priced a 2 million-share offering at $10 share.

NASD

said its 84% of its member firms gave their approval to a spin off of the

Nasdaq Stock Market

, with 3.423 in favor, while 652 were opposed. The NASD said that 110 of its abstained from voting on the proposed public offering.

Analyst actions

Ameritrade

(AMTD) - Get Report

: UP to strong buy from buy at

U.S. Bancorp Piper Jaffrey

. Ameritrade stumbled 1 15/16, or 11.1%, to 15 1/2.

ADC Telecom

(ADCT) - Get Report

: UP to strong buy from buy at

SG Cowen

. ADC Telecom skidded 2 7/16 to 49 5/16.

Chase Hambrecht & Quist

rolled out coverage of several electronic companies including

Celestica

(CLS) - Get Report

,

Plexus

(PLXS) - Get Report

,

SCI Systems

(SCI) - Get Report

and

Jabil Circuit

(JBL) - Get Report

stamping all with buy ratings.

Celestica shed 3 1/8, or 6.7%, to 43 1/2 and Plexus fell 3 15/16, or 6.3%, to 58 9/16, while SCI Systems lost 3 9/16, or 7.6%, to 43 3/16. Jabil Circuit slipped 3 7/8, or 11.2%, to 30 7/16.

Danaher

(DHR) - Get Report

: INITIATED market outperformer at

Goldman Sachs

. Danaher declined 2 to 49 11/16.

Gap

(GPS) - Get Report

and

Abercrombie & Fitch

(ANF) - Get Report

: DOWN to buy from strong buy at

US Bancorp Piper Jaffrey

. Gap's price target was lowered to 48 from 56. Gap sank 2 7/16, or 5.8%, to 39 1/4 and Abercrombie slipped 11/16, or 5.6%, to 11 9/16.

Goodyear Tire

(GT) - Get Report

: UP to strong buy from hold at

Warburg Dillon Read

. Goodyear Tire slid 5/8 to 29 1/4.

Lands' End

(LE) - Get Report

: DOWN to hold from buy at

Credit Suisse First Boston

. Lands' End sank 6 9/16, or 11.3%, to 51 1/16.

Donaldson Lufkin & Jenrette

analyst Eric Ross initiated coverage of five Internet consulting companies, including

MarchFirst

(MRCH)

,

Organic

(OGNC)

,

Scient

(SCNT)

,

Viant

(VIAN)

and

Diamond Technology

(DTPI)

.

Diamond Technology was started as the company's top pick. Diamond Technology fell 1 1/16 to 54 3/16.

MarchFirst, Organic, Scient and Viant were all started at buy. MarchFirst stumbled 2 1/4, or 9.4%, to 21 11/16; Organic declined 1 1/2, or 11.3%, to 11 13/4; Scient skidded 6 7/8, or 16.2%, to 35 3/8 and Viant lost 1 9/16, or 7.4%, to 19 1/2.

Partner Communications

(PTNR) - Get Report

: NEW strong buy at

Morgan Stanley Dean Witter

. Partner Communications declined 3/4, or 6.3%, to 11.

Resource Phoenix.com

(RPCX)

: DOWN to market perform from strong buy at

Thomas Weisel

by analyst Perry Boyle Jr. Resource Phoenix.com shed 3 3/16, or 64.5%, to 1 3/4.

Starwood Hotels & Resorts

(HOT)

: REINSTATED as a buy with a target price of 38 at Merrill Lynch;

Four Seasons Hotel

(FS)

REINSTATED with an intermediate accumulate, long-term buy rating. Starwood Hotels fell 1 5/8, or 5.6%, to 26 15/16 and Four Seasons shed 1 7/16 to 45 7/16.

Weatherford International

(WFT) - Get Report

: NEW buy at

Deutsche Banc Alex. Brown

; price target of 64. Weatherford popped 1 3/16 to 57 13/16.

Miscellany

Microsoft

(MSFT) - Get Report

acknowledged that some of its Internet software carried a secret password that could be used to gain unlawful access to hundreds of thousands of Internet sites worldwide,

The Wall Street Journal

reported.

The password is a "phrase deriding their rivals at Netscape as 'weenies,'" according to the story. A Microsoft security manager said the backdoor password goes against its policy and said it is a firing offense for the as-yet unidentified employees. Microsoft sank 3 13/16 to 75 3/8.

The Heard on the Street column in the

Journal

looks at

Salomon Smith Barney

analyst Colin Devine, who took heat for his downgrade of insurance company

Conseco

(CNC) - Get Report

in early 1999, including flak from the Conseco chairman himself. Since the downgrade, Conseco has plunged 77% and Devine no longer has to justify his call. The story says his predicament is a reminder of the challenges analysts face when it comes to making unfavorable calls on companies they cover. Salomon is a unit of

Citigroup

(C) - Get Report

. Conseco declined 1/4 to 7 5/8, while Citigroup stumbled 4 1/16, or 6.4%, to 58 1/2.

In the Inside Wall Street column in

Business Week

, penned as usual by Gene Marcial, the columnist offers up bullish stories on

Level 8 Systems

(LVEL)

, a provider of e-commerce business-integration software, and

MarineMax

(HZO) - Get Report

, the largest U.S. recreational boat dealer. Marcial, in the MarineMax story, cites Annie Erner of Salomon Smith Barney as saying that the shares are "significantly undervalued." Also, Marcial positively highlights

Dataram

(DRAM)

, a maker of printed-circuit memory products. Level 8 shed 2, or 7.5%, to 24 1/2 and MarineMax shed 1/16 to 9 9/16, while Dataram skidded 5/32 to 16 1/2.