Charles Schwab & Co., Inc.
Email Alert

Morning Market View(TM) 
for Tuesday, November 27, 2001
as of 9:30AM EST
Information provided by Schwab Center for Investment Research


STOCKS POISED FOR REPRIEVE

U.S. stocks were set to take a breather from the recent rally at 
the open, continuing the trend from overseas as Nokia Corp. 
(NOK,25,f2) cut its forecast for global wireless demand for 2001 
and projected a less optimistic forecast for 2002 demand than 
that of previous estimates by other major industry players. 
Earnings news was fairly sparse with Tech Data (TECD,40,f1) and 
K-Mart (KM,6.85) both beating the Street's estimates. Treasuries 
were softer ahead of today's consumer confidence data, scheduled 
for a 10:00 a.m. EST release.

Merchandise discounter K-Mart Corp. reported a 3Q loss excluding 
charges of $0.25 per share, slightly better than the First Call 
consensus estimate for a $0.27 per share loss as the company 
incurred costs from re-tooling its supply-chain infrastructure. 
Same store sales fell 1.5%.

Global IT hardware and software provider Tech Data Corp. was 
trading higher in premarket activity after posting 3Q profits 
excluding charges of $0.58 per share, ahead of the Street's 
$0.51 per share consensus estimate, as sales declined 19% to 
$4.2 billion. The company's CEO commented that, "We continued to 
execute extremely well during the quarter, delivering solid 
results despite the weak economic conditions." Additionally, 
Tech Data forecast 4Q earnings of $0.58-$0.63 per share versus 
the Street's $0.61 per share estimate.

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TREASURY AND ECONOMIC SUMMARY 

Bonds were mixed, but generally lower as traders speculated that 
today's consumer confidence report may come in above analysts' 
expectations. Analysts per Bloomberg are expecting a November 
reading of 86.5 versus October's 85.5 level. Consumer confidence 
has been declining since June and is at its lowest level in over 
seven years.

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WORLD MARKETS 

European markets were lower after Nokia Corp. cut its 2001 sales 
estimate for global handsets to 380 million from the previous 
390 million forecast and said it anticipates worldwide sales of 
420-440 million phones in 2002, slightly lower than Motorola's 
(MOT,17.96,f2) earlier 420-460 million forecast. The wireless 
giant expects sales to increase by 15% in 2002, with 25%-35% 
growth in 4Q of 2002. Earlier in the day, Bank of England 
Governor Sir Edward George commented that the global economy 
will potentially recover more quickly than expected next year 
and that chances of a recession in the UK are slim due to the 
strength in consumer spending. George said he couldn't 
understand the relative weakness in the euro. Nevertheless, the 
euro-zone currency continued lower against the dollar ahead of 
today's consumer confidence data in the U.S. The Bloomberg 
European 500 index was down 0.5% as of 8:54 a.m. EST, led by 
weakness in tobacco and insurance stocks while manufacturing and 
telecom issues were higher.

The Nikkei 225 index led Asian markets lower, closing down 1.0% 
on weakness in communications and banking stocks after Fitch 
downgraded the credit ratings of several large Japanese banks, 
saying that the government is not in a strong enough position to 
support the beleaguered industry. Shares of NTT DoCoMo 
(NTDMY,71) fell after the wireless operator found a flaw in its 
high-speed wireless Internet services phones made by NEC Corp. 
(NIPNY,10.28) and Standard & Poor's said it may downgrade the 
company's credit rating on restructuring concerns. The yen was 
trading flat against the dollar. Crude oil got a boost after 
President Bush demanded that UN weapons inspectors be allowed 
back into Iraq, threatening oil supplies from the region.

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FUTURES WATCH 

In the December Globex futures contract as of 8:54 a.m. EST, the 
S&P 500 index was 4 points lower (7 points below fair value), 
while the Nasdaq 100 index was down 8 points (12 points below 
fair value). The December DJIA futures contract was down 28 
points (43 points below fair value), and the January crude oil 
futures traded on the NYMEX were up $0.11 at $18.80/barrel.

William Johnson, Market Analyst

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