Weekend Report: Bell Atlantic-AirTouch Merger Meeting Is Set - TheStreet

Weekend Report: Bell Atlantic-AirTouch Merger Meeting Is Set

Meanwhile, trading in the Euro begins.
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The boards of Bell Atlantic (BEL) and AirTouch (ATI) - Get Report are scheduled to meet today to vote on a proposed $45 billion merger, Reuters reported, citing industry sources.

The news service said an agreement could be announced as early as Tuesday.

Reuters

said the companies did not offer comment. But a German newspaper, the

Frankfurter Allgemeine Zeitung

, said Saturday that spokespersons from both companies had confirmed that merger negotiations were underway.

As big as Bell Atlantic-AirTouch merger would be, in the really, really big scheme of things (no,

really

) there's only one thing that matters tomorrow when trading restarts on Wall Street: the euro.

Trading in the new currency began this weekend in what was described Saturday in the Op-Ed page of

The New York Times

as "the climax to the most benignly ambitious geopolitical experiment since the founding of the United States." The switch was going relatively smoothly overnight in Asian markets, according to various reports.

The euro was trading at 133.15 yen early in Tokyo trading, according to news wires. In Sydney, the euro opened trading at $1.1747 vs. the U.S. dollar.

"The fact it got off the ground and is trading in Japan tonight is a big deal," one hedge fund source told

TheStreet.com

. "I think everyone is pretty much taking it in stride, but tomorrow will be a big morning."

The source, who asked not to be identified, said he saw no sign anything unusual going on and was merely "slaving away on a Sunday night" in New York.

In Tokyo, the

Nikkei 225

average was trading lately down 279.20, or 2%, at 13,562.97.

One non-Euro related issue he did mention was the fact "Japanese government bonds continue to go through the floor." Japanese bond prices tumbled in recent trading after

Bank of Japan

Governor

Masaru Hayami

said the government would stop bond purchases beginning this month. The subsequent more than doubling of yields of said paper has pressured the U.S. dollar vs. the yen and Treasury bond market, pushing the yield on the benchmark 30-year back solidly above 5% in recent weeks.

Watch for more selling of dollar-denominated assets if JGB's continue to slide overnight. In fact, continued weakness in the dollar is the major concern of some market watchers going forward as 1998 fades back, has got a man open, but is sacked by the new year.

In an informal interview last week in San Francisco, Tracy Herrick, market strategist at

Jefferies

, noted that his big concern for 1999 is continued weakness in the dollar. Such a development might compel the

Federal Reserve

to actually

raise

interest rates in defense of the greenback, he reasons, a truly shuddering thought to bull market believers.

Reached late Sunday in Chicago, Brian Gilmartin, portfolio manager at

Trinity Asset Management

, countered that notion.

"Currency levels don't influence monetary policy," Gilmartin contends. "Rarely will you ever hear

Fed Chairman Alan Greenspan

comment about actual changes in the currency. It just doesn't influence him."

And, In Other News

Stanley Fischer, first deputy managing director of the

International Monetary Fund

, was quoted Sunday saying most Southeast Asian economies should grow in 1999, thanks to a stronger yen.

Separately, South Korea reported a record $39.88 billion trade surplus for 1998, reversing a deficit of $8.45 billion in 1997. South Korea also said its usable foreign reserves totaled $48.51 billion at the end of 1998, up from $8.87 billion a year ago.

Speaking to reporters during an economic conference in New York, the IMF executive also said he expects the pace of dollar outflows from Brazil to slow in January from a rapid pace last month.

"They have enough reserves to get their fiscal house in order," he said.

Finally,

Barron's

offers bullish pieces on

Morton International

(MII)

,

AES

(AES) - Get Report

, and the

Janus Twenty

fund.

The weekly's "Trader" column argues for some more potential buying in

Amoco

(AN) - Get Report

because U.K-based index funds will have to add shares following regulatory approval of the company's merger with

British Petroleum

(BP) - Get Report

. Conversely, the column says

Firstar

(FSR)

could face some selling: It rose last week after being added to the

S&P 500

index.