As the

Dow Jones Industrial Average

moves gently higher this morning, investors seem a tad less shaky about the prospect of inflation than they were last week.

Bonds, which took a serious hit on Friday, were little changed in morning trading. The bellwether 30-year Treasury bond saw its yield trimmed 0.01 percentage points to 6.83 % as of mid-morning.

On Friday that yield had jumped .08 percentage point as traders fretted about the inflationary pressures of a hot jobs report. Today's calmness, however, could become tomorrow's angst. The December

Consumer Price Index

will be released tomorrow at 8:30 AM EST.

Meanwhile shares of the Chicago-based Baby Bell

Ameritech

(AIT:NYSE) are rising in the wake of a buoyant earnings report for the fourth quarter of 1996. Before one-time adjustments, Ameritech earned $1 per share compared to 90 cents one year earlier.

That matches expectations from New York-based earnings tracker

IBES International

. As the first local telco to petition the Federal Communications Commission for long-distance service rights, Ameritech hopes to vault ahead of its sibling bells into the land of local phone competition. Ameritech also said that its cellular subscribers grew 33%, which could bode well for its business outside of traditional local phone calling.

Ameritech's solid earnings boosted other Baby Bells as well.

In other good news, banks jumped higher on good earnings news, led by a stronger-than-expected report from

J. P. Morgan

(JPM:NYSE).

Amgen

(AMGN:Nasdaq), which reported Friday its Lou Gehrig disease-treatment has failed a Phase 3 clinical trial, slid in morning trading. An investment rating downgrade by

Salomon Brothers

didn't help matters.

By Kevin Petrie

kpetrie@thestreet.com