Charles Schwab & Co., Inc.

Midday Market View(TM) for Wednesday, June 6, 2001
as of 1:00PM EDT
Information provided by Standard & Poor's

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U.S. INDICES
(1:00p.m. EDT)

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Market            Value     Change

DJIA          11,106.60    - 69.20
Nasdaq Comp.   2,224.52     - 9.14
S&P 500        1,274.18     - 9.39
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NYSE Advancing Issues        1,158
NYSE Declining Issues        1,756
NYSE Trading Volume        567 mln
NASDAQ Advancing Issues      1,406
NASDAQ Declining Issues      2,134
NASDAQ Trading Volume     1.05 bln

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U.S. TREASURIES
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Value            Yield      Change

1-year bill       3.55%        n/a
5-year note       4.83%     - 3/32
10-year note      5.27%       unch
30-year bond      5.65%     + 3/32

The tables above look best when viewed in a fixed-width font,
such as "Courier."

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U.S. TRADING SUMMARY

Stocks vacillated this morning around unchanged levels before
falling into negative territory. An earnings warning from
Hewlett-Packard took the wind out of buyers' sails as the NASDAQ
quickly headed south. Both the Dow and S&P 500, weak from the
start of the session, erased almost all of their gains from
Tuesday as they extended their losses. Traders continued to worry
about the health of the economy and decided that taking profits
after the recent stock market run-up was the better choice.

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U.S. TREASURY SUMMARY

Almost all maturities of Treasuries were lower at midday.
However, stock market weakness has provided some support. The
profit-taking began in the overnight session in Asia and
continued through this morning's open in the U.S. Economic data
remained nonexistent, so traders were forced to rely on
vacillations in the equity market and technical analysts to help
guide them through the illiquid session. By midday, shorter- and
middle-dated issues were in the red while longer-dated issues
managed to climb out of negative territory.

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CURRENCY SUMMARY

The British pound sterling has led the way to across-the-board
dollar gains. Worries that a re-elected Labour government would
make an early push for European Monetary Union entry has provided
the catalyst for sterling selling. A report in the U.K.
Independent that Labour would push for an early referendum, later
denied by Prime Minister Tony Blair, helped fuel the panic
sterling selling, which spilled over into other European
currencies. Moreover, worries over upcoming European data and
ongoing European Central Bank policy credibility issues have also
weighed on the euro, pushing the common currency to session lows
versus the dollar. Meanwhile, the dollar is holding firm just
above 120 yen.

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MAJOR COMPANY / INDUSTRY NEWS
(All prices as of 1:05 p.m. EDT)

** Hewlett-Packard (HWP: 28.97, - 1.08) announced that sales in
its latest fiscal quarter may be weaker than the company
anticipated. Hewlett-Packard stated that slow corporate spending
had spread beyond the United States and Europe and now is a
threat to the firm's sales in Latin America and Asia. Further
cost-cutting measures will be put into effect, but the tech giant
did not give details.

** British Airways (BAB: 53.00, - 1.05) and AMR Corp.'s (AMR:
38.15, - 0.01) American Airlines have restarted talks in order to
revive their previous discussions about a joint venture,
according to the Financial Times. To determine what conditions
could be imposed on the duo, the two have begun speaking with
regulators in Brussels, London and Washington. Both airlines are
looking to gain approval for the venture in order to share
revenues and profits on transatlantic services. Original talks
began five years ago for the same type of venture, but the plans
were shelved when both airlines were unwilling to give up 300
highly prized takeoff and landing spots at London's Heathrow
airport.

** Newport News Shipbuilding (NNS: 64.00, - 0.34) announced that
it has reaffirmed its backing of General Dynamics' (GD: 78.13, -
1.99) takeover bid. General Dynamics and Newport News officials
are expected to meet with the Justice Department and Pentagon
officials today in order to discuss details of the potential
merger. Newport News said that General Dynamics' bid offers
better value than the unsolicited bid by Northrop Grumman (NOC:
89.59, - 0.65).

** Circuit City Stores (CC: 15.54, - 0.27) now expects a profit
instead of a loss in the fiscal first quarter due to strong
revenues from its CarMax Auto Group (KMX: 15.19, - 1.26). The
electronics chain stated that it should post a profit of $0.04
per share, which is a welcome deviation from the $0.03 per share
loss most analysts had expected.

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RESEARCH SPOTLIGHTS

** Lehman Brothers upgraded shares of Procter & Gamble (PG:
65.44, + 1.36) from a market performer to a buy rating.

** Wells Fargo Van Kasper upgraded shares of Sycamore Networks
(SCMR: 11.30, - 0.25) from a buy to a strong buy rating.

** Goldman Sachs upgraded USX-U.S. Steel Group (X: 21.00, - 0.74)
from a market under-performer to a market performer rating.

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