Charles Schwab & Co., Inc.

Midday Market View(TM) for Friday, May 18, 2001
as of 1:00PM EDT
Information provided by Standard & Poor's

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

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

----------------------------------
Market            Value     Change

DJIA          11,201.40    - 47.10
Nasdaq Comp.   2,183.85     - 9.83
S&P 500        1,283.22     - 5.27
----------------------------------
NYSE Advancing Issues        1,455
NYSE Declining Issues        1,461
NYSE Trading Volume        633 mln
NASDAQ Advancing Issues      1,638
NASDAQ Declining Issues      1,896
NASDAQ Trading Volume      995 mln

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

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

1-year bill       3.71%        n/a
5-year note       4.98%     - 1/32
10-year note      5.40%     + 2/32
30-year bond      5.75%     + 6/32

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

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

U.S. TRADING SUMMARY

The major U.S. equity markets continue to hover around unchanged
levels as profit takers and bargain hunters battle for supremacy.
Initially, the markets headed south on negative outlooks from two
tech giants, Dell and Palm. Yet, buyers were waiting for the
sellers as the NASDAQ found support and clawed back into positive
territory. But given the strong gains earlier this week in
equities, and the upcoming weekend, buyers were less willing to
trade aggressively and pay higher prices for shares. Instead,
those looking to buy let the sellers bring the market back to
them. The lack of a commitment from buyers and sellers has
resulted in volatile trade around unchanged levels.

----------------------------------------------------------------

U.S. TREASURY SUMMARY

Treasuries are mixed at midday with the longer-dated issues
stronger in price as the other maturities remain underwater.
Shorter-dated securities are under pressure from lowered
expectations of Federal Reserve interest-rate easing as some
analysts have concluded that the Fed may not continue to cut
interest rates, or at least not cut as aggressively as they have
been this year. Competing debt supply is also weighing on 2-, 5-
and 10-year maturities as the stampede to issue new debt
continues. Meanwhile, the bond is higher in price on oversold
conditions and continued downward revisions to inflation
expectations after Wednesday's tame Consumer Price Index.

----------------------------------------------------------------

CURRENCY SUMMARY

The U.S. dollar has maintained its early gains against the yen
and the euro, trading at around 0.877 dollars per euro and 123.6
dollars per yen. The dollar gained ground against both currencies
overnight and early this morning on a combination of factors.
Renewed concerns over the European Central Bank's implementation
of monetary policy, along with discouraging economic data,
weighed on the euro. The yen came under pressure after the Bank
of Japan indicated that it may buy back additional Japanese
government debt.

----------------------------------------------------------------

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

** French telecommunications giant Alcatel (ALA: 29.40, - 2.64)
is reportedly in talks to buy Lucent Technologies (LU: 10.03, +
0.22) for about $40 billion. According to the New York Times,
discussions are in a crucial advanced stage, with a decision on
the next step coming within a week. Alcatel shares were pummeled
in Europe on the news as investors questioned the value of the
deal for the French giant as well as the ability of Alcatel to
integrate Lucent's business and corporate culture. The deal would
involve Lucent getting a 20% premium for its shares in an
all-stock transaction.

** Instinet Group (INET: 17.92, + 3.42), the leading
institutional third market stock exchange, went public today. The
company raised $464 million in the first IPO of an alternative
trading network. The IPO of Instinet, which is the largest
electronic communication network, is seen as a major test for
other ECNs hoping to go public. Reuters will retain a majority
stake, 87%, in the company. Instinet's value of $3.5 billion
eclipses the expected market value of the NASDAQ stock market,
which is $2 billion. NASDAQ is expected to go public sometime in
2002. The Instinet IPO is the first higher profile offering to
hit the Street in some time, and investors are closely watching
how well it is received.

----------------------------------------------------------------

RESEARCH SPOTLIGHTS

** Lehman Brothers upgraded shares of Johnson & Johnson (JNJ:
100.19, - 0.13) from a market performer to a buy rating.

** Lehman Brothers upgraded Broadcom (BRCM: 42.58, + 1.54) from a
market performer to a buy rating.

** Bear Stearns upgraded shares of Ann Taylor Stores (ANN: 37.64,
- 0.35) from a neutral to an attractive rating.

################################################################

Log in using the links below to:

Access your account:
https://investing.schwab.com/trading/start?SANC=CCBodyi&NeedCASelValue=Y

View your Email Alert customization options:
https://investing.schwab.com/trading/start?SANC=EAMyAlerts

Perform research or request a market quote:
https://investing.schwab.com/trading/start?SANC=Quotes

Place a trade order:
https://investing.schwab.com/trading/start?SANC=TradeStock

To visit Schwab's home page, use this link:
http://www.schwab.com/

-----------------------------------------------------------------

To unsubscribe or modify your Email Alert customization options,
log in using the link below or copy and paste it into your
browser's address window:

https://investing.schwab.com/trading/start?SANC=EAMyAlerts

Now you can receive graphics Email Alerts in HTML format,
using helpful, full-color graphics and active Web links that
connect you directly to information you want. Use the link
below to log in and change your email format preference:

https://investing.schwab.com/trading/start?SANC=EAEditEmailAddr

----------------------------------------------------------------

Notice: All email sent to or from the Charles Schwab corporate
email system may be retained, monitored and/or reviewed
by Schwab personnel. (1000-8752)

Copyright 2001 Standard & Poor's MMS Inc.  All rights reserved.
Standard & Poor's MMS services are for personal use only.
Commercial use or redistribution in any form, print or
electronic, is prohibited.
Distribution by Quris, Inc.