Charles Schwab & Co., Inc.
Email Alert

Midday Market View(TM) 
for Wednesday, October 24, 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           9,314.20    - 25.88
Nasdaq Comp.   1,719.01    + 14.57
S&P 500        1,082.01     - 2.77
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NYSE Advancing Issues        1,243	
NYSE Declining Issues        1,673
NYSE Trading Volume        643 mln
NASDAQ Advancing Issues      1,645
NASDAQ Declining Issues      1,586
NASDAQ Trading Volume      898 mln

==================================

U.S. TREASURIES
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Value            Yield      Change

6-month bill      2.06%        n/a
5-year note       3.83%     - 1/32
10-year note      4.61%     - 2/32
30-year bond      5.34%     - 3/32

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

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MIXED PICTURE

Stocks drifted in and out of positive territory amid a plethora 
of mixed earnings results and mostly cautious guidance. Traders 
will likely look to today's Beige Book economic summary at 2:00 
p.m. EDT for more clues about the economic outlook.

As of 12:03 p.m. EDT, the Dow Jones Industrial Average was down 
0.2%, with the Nasdaq Composite Index 1.2% higher. The S&P 500 
Index was virtually flat. Computer-related, chip and drug stocks 
paced the advancers, while energy-related and telecom issues 
were among the worst performers.

Shares of Amazon.com (AMZN,7.65,f2) were sharply lower after the 
Internet retailing giant said its 3Q loss, excluding items, 
narrowed to $0.16 a share, matching the First Call consensus 
estimate, on revenues of $639.3 million, slightly below the 
Street's $650.3 million mean forecast. The company attributed 
the slimmer loss to cost cutting at its warehouses. Going 
forward, Amazon said it expects year-over-year 4Q sales to be 
flat to 10% higher, down from its previous guidance of a 10% to 
20% increase. The new estimate would put sales in the range of  
$970 million to $1.07 billion, below the First Call consensus of 
$1.10 billion.

Shares of Compaq Computer (CPQ,9.41,f2&f4) were slightly lower 
after the PC maker said that it incurred a 3Q loss, excluding 
items, of $0.07 per share, $0.01 shy of the First Call consensus 
estimate, owing to sluggish demand and a fiercely competitive 
price war, as it continues to give up market share to rival Dell 
Computer (DELL,25,f1). Looking ahead, Compaq lowered its 4Q 
outlook, saying its expects an operating loss of $0.03 per 
share, lower than the Street's break-even mean forecast.

AMR Corp. (AMR,19.75), parent to airline carrier American 
Airlines and TWA, said its 3Q loss, excluding items, was $3.40 
per share, well below the First Call consensus of $2.61 per 
share. AMR blamed sluggish demand, exacerbated by the September 
attacks, for its troubles. Revenues for September alone fell 
22%. Looking forward, AMR's CEO said that 4Q results "won't be 
pretty."

Shares of Eastman Kodak (EK,29), were getting hammered after the 
photography giant reported 3Q operating profits of $0.52 per 
share, in line with the Street's mean estimate. The Dow 
component announced that it will eliminate as many as 4,000 
workers, and that 4Q operating profits will be about one-third 
of the First Call consensus estimate of $0.46 per share, due to 
the economic malaise.

Aerospace and diversified manufacturer Honeywell International 
(HON,28,f2) reported 3Q profits, excluding charges, of $0.44 per 
share, matching the First Call consensus estimate. Including a 
$1 billion charge for job cuts and restructuring, Honeywell 
posted a net loss of $0.38 a share. The Dow component said its 
aerospace business was hurt by sluggish demand in the airline 
industry, aggravated by the September attacks.

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TREASURY AND ECONOMIC SUMMARY

Bonds held on to gains in quiet trading ahead of today's 2-year 
note auction, the results of which will be released at 1:00 p.m. 
EDT. The Beige Book report on the economy, which will serve as a 
basis of discussion and policy at the upcoming Nov. 6 Federal 
Open Market Committee meeting, is scheduled for a 2:00 p.m. EDT 
release.

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WORLD MARKETS

European markets were mostly higher late in the day with 
strength in paper, manufacturing and computer service issues, 
while energy stocks paced the decliners. The Bloomberg European 
500 Index was up 0.22% as of 12:03 p.m. EDT. BP PLC (BP,48) led 
the decline in oil stocks following reports from the American 
Petroleum Institute and Department of Energy that showed 
weakening U.S. demand for crude products. The DOE reported a 2.8 
million barrel inventory increase during the week ended Oct. 18. 
German Consumer Price Index data indicated that consumer prices 
declined 0.3% during the month through mid-October, and rose 
2.0% year-over-year through the same date, in line with the 
European Central Bank's inflation target, fueling optimism that 
the ECB will cut interest rates at Thursday's meeting in order 
to stimulate the weak euro-region economy. The euro, which rose 
against the dollar earlier following the data, held on to its 
gains.

William Johnson, Market Analyst 

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