Charles Schwab & Co., Inc.

       Morning Market View(TM) for Monday, October 22, 2001
                       as of 9:30AM EDT
 Information provided by Schwab Center for Investment Research 

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LACKLUSTER PREMARKET ACTIVITY

Stocks were poised to open flat to lower in the absence of any 
significant economic news until mid-week, amid primarily 
cautious earnings news. Earnings season resumes this week as 
roughly 160 of the S&P 500 companies will report, according to 
First Call.

Minnesota Mining & Manufacturing (MMM,102) reported 3Q operating 
earnings of $1.10 per share, $0.01 higher than the First Call 
mean estimate as global sales declined 7%. The Dow component 
said profits fell 12.4% from the year ago period mainly due to a 
slowing U.S. economy. Going forward, 3M lowered its 4Q earnings 
guidance to a range of $0.95-$1.05 per share, versus its 
previous $1.05 forecast.

Wireless, data communications and phone service provider SBC 
Communications (SBC,44,f2) posted 3Q profits, excluding items, 
of $0.59 per share, $0.01 below the First Call consensus 
estimate as business conditions worsened in recent months. The 
Dow component plans to cut capital expenditures by 20% in 2002 
and eliminate several thousand jobs as it attempts to achieve 
"meaningful growth in 2002."

Dell Computer (DELL,24,f1) and EMC Corp. (EMC,11.51,f2) 
announced a five-year alliance aimed at growing both companies' 
storage system segments. The companies have agreed to co-market 
EMC's CLARiiON enterprise storage systems line in an effort to 
broaden Dell's storage presence, while enabling EMC to better 
position itself in the Windows NT and 2000 storage segments. 

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TREASURY AND ECONOMIC SUMMARY 

Bonds were narrowly higher as stocks adopted a mixed to slightly 
negative tone in premarket activity. The economic picture this 
week doesn't heat up until Wednesday's release of the Fed's 
Beige Book at 2:00 p.m. EDT.

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WORLD MARKETS 

European trading was mixed with computer-related, telecom and 
energy stocks leading the Bloomberg European 500 Index narrowly 
higher, up 0.46% as of 8:54 a.m. EDT. Energy stocks were boosted 
by heightened speculation that OPEC stands ready to cut 
production in anticipation of increasing global crude 
inventories through Q4 2001 and Q1 2002. The euro was softer 
against the dollar amid concerns that the hawkish European 
Central Bank's monetary policy has been less stimulative than 
that of the Fed's in the U.S.

Asian markets were mixed, but Japan's Nikkei-225 Index eked out 
a slight gain, up 0.25% at the close. Retail, pharmaceutical and 
export stocks were among the best performers, while banking 
shares led the declines. Select technology shares were also 
softer after a weekly report showed that DRAM prices had slipped 
below $1 as manufacturers struggled to trim inventories. The yen 
was lower against the dollar after Japan's All Industries Index 
declined 0.2% in August from the prior month, reflecting 
deteriorating economic conditions even before Sept. 11.

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FUTURES WATCH 

In the December Globex futures contract as of 8:54 a.m. EDT, the 
S&P 500 Index was up 0.5 points (2 points below fair value), 
while the Nasdaq 100 Index was flat. The December DJIA futures 
contract was down 13 points (26 points below fair value), and 
the November crude oil futures traded on the NYMEX were down 
$0.04 at $21.79/barrel.

William Johnson, Market Analyst

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