Charles Schwab & Co., Inc.
Email Alert

Midday Market View(TM) 
for Tuesday, October 23, 2001
as of 1:00PM EDT
Information provided by Schwab Center for Investment Research
and Bridge 


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

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Market            Value     Change

DJIA           9,335.31    - 41.72
Nasdaq Comp.   1,714.18     + 6.10
S&P 500        1,086.49     - 3.41
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NYSE Advancing Issues        1,528	
NYSE Declining Issues        1,400
NYSE Trading Volume        688 mln
NASDAQ Advancing Issues      1,624
NASDAQ Declining Issues      1,731
NASDAQ Trading Volume      966 mln

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U.S. TREASURIES
----------------------------------
Value            Yield      Change

6-month bill      2.07%        n/a
5-year note       3.83%     - 1/32
10-year note      4.63%       unch
30-year bond      5.37%     - 1/32

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

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STOCKS MIXED IN CHOPPY TRADING

Stocks were mixed at midday following a slew of contrasting 
earnings reports amid a relative lack of any market moving 
economic data.

As of 12:03 p.m. EDT, the Dow Jones Industrial Average was down 
0.2%, and the Nasdaq Composite Index was 0.6% higher. The S&P 
500 Index was virtually unchanged. Transport, retail and 
insurance stocks were among the best performers, while 
healthcare, phone and leisure issues were lower.

Shares of Lucent Technologies (LU,6.64,f2) were lower after the 
struggling telecommunication equipment giant said its loss for 
fiscal 4Q widened to $0.27 per share, excluding $8 billion in 
restructuring and one-time charges, worse than the $0.23 per 
share loss forecast by First Call. Including the charges, 
Lucent's loss widened to $2.59 per share. The company cited the 
elimination of jobs and some of its product lines for the 
charges. Going forward, Lucent anticipates a sequential fall in 
revenue in fiscal 1Q before a rise in fiscal 2Q sales.

Leading U.S. oil company and Dow component Exxon Mobil 
(XOM,41,f2) posted 3Q earnings, excluding items, of $0.48 per 
share, below the First Call consensus of $0.50 per share on a 
9.5% revenue decline amid softening demand and weaker oil and 
natural gas prices. In a similar story, oilfield services 
company Schlumberger Ltd. (SLB,49,f2) reported 3Q earnings of 
$0.34 per share, $0.01 lower than the Street's mean forecast.

Pharmaceutical titan Bristol-Myers Squibb (BMY,60,f2) posted 3Q 
earnings of $0.63 per share, in line with the First call 
consensus. Sales of the company's diabetes and blood-clotting 
drugs offset declining sales of its flagship cancer and anxiety 
medicines.

Shares of MetLife (MET,27) were trading higher after the 
insurance and financial services company reported that it was 
eliminating roughly 1,900 jobs in a move to cut costs amid 
weakening conditions in the sector. The company also reduced its 
claims estimates associated with the Sept. 11 attacks to roughly 
$210 million from the previous forecast of $250 million-$300 
million. The company expects 3Q operating profits of $0.29-$0.31 
per share. In the days after the attack, analysts surveyed by 
First Call had dropped their 3Q EPS forecast to $0.14-$0.17 per 
share.

In the chip sector, shares of Vitesse Semiconductor Corp. 
(VTSS,10.36,f1) were higher after the CEO of the communications 
chip manufacturer said that he believes demand should improve in 
2002. Vitesse posted a fiscal pro forma 4Q loss of $0.14 per 
share, just below the lowered First Call consensus of a $0.13 
per share loss. Meanwhile, programmable chip maker Altera Corp. 
(ALTR,20,f1) posted 3Q earnings of $0.05 per share, in line with 
the Street's mean estimate, but indicated that sales will 
decline again in 4Q.

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TREASURY AND ECONOMIC SUMMARY

Bonds reversed course to trade slightly higher as equities 
retreated from earlier highs. Bonds will likely take direction 
from stocks absent any significant economic data or salient 
Fed-speak. Increasing speculation that the government will be 
forced to issue a larger debt supply, such as tomorrow's 
scheduled $19 million two-year note sale, to subsidize the 
future fiscal stimulus may also be pressuring Treasuries.

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WORLD MARKETS

European markets held on to early gains late in the day, with 
the Bloomberg European 500 Index up 2.57% as of 12:03 p.m. EDT 
amid mostly positive corporate earnings news. DaimlerChrysler AG 
(DCX,37,f2) posted a slimmer-than-expected 3Q loss on the heels 
of an aggressive cost-cutting campaign, while drug giant 
GlaxoSmithKline PLC (GSK,54) saw its 3Q earnings rise 20%, 
slightly above expectations. The dollar remained higher against 
the euro as traders weighed the relative lack of monetary 
stimulus in the euro-zone as compared to the U.S. Adding to the 
gloomy economic landscape, Italian business confidence fell to 
84 in September from August's 96 reading, the lowest level in 
more than five years and well below expectations.

William Johnson, Market Analyst

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