Charles Schwab & Co., Inc.
Email Alert

Morning Market View(TM) 
for Wednesday, January 2, 2002
as of 9:30AM EST
Information provided by Schwab Center for Investment Research


STOCKS SLIGHTLY HIGHER TO KICK OFF NEW YEAR

Against the backdrop of little corporate or economic news, 
stocks are poised to open slightly higher, with technology 
leading the way following an upbeat Semiconductor Industry 
Association report. Chipmaker Micron Technology (MU,31,f2) is 
higher in premarket activity following news that a potential 
partner raised DRAM prices by 30%. Treasuries are slightly 
lower, while global markets are mixed as today marks the 
official transition to the euro currency in the euro-region.

Chipmakers could get a boost this morning after the 
Semiconductor Industry Association (SIA) reported that global 
sales of semiconductors rose 1.6% in November to $10.6 billion, 
the second consecutive monthly increase after October's sales 
rose 2.5% to $10.44 billion. SIA also indicated the industry is 
on pace to realize 4.7% growth in 4Q sequential sales. 
Continuing the improving theme, shares of Micron Technology are 
higher in the premarket session after South Korea's Hynix 
Semiconductor (HXSCF,0.80) raised the price of its memory chips 
by 30%, its third increase in a month. Separately, Hynix 
indicated this morning that it will wrap up merger talks with 
Micron this month.

Media conglomerate Walt Disney Co. (DIS,21,f2) was granted a 
temporary restraining order prohibiting satellite-TV operator 
EchoStar Communications (DISH,27,f1) from dropping the Dow 
component's ABC Family channel from its listings. EchoStar 
claims Disney's purchase of ABC Family from News Corp. (NWS,32) 
in October voided the network's contract.

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TREASURY AND ECONOMIC SUMMARY 

Bonds are lower across the curve in front of today's Institute 
for Supply Management's manufacturing index, scheduled for a 
10:00 a.m. EST release. Formerly known as the National 
Association of Purchasing Management survey, the ISM 
manufacturing index is expected to rise to 46.0 in December from 
November's 44.5, according to a Dow Jones Newswires survey, 
indicating contraction at a decelerating pace in the sector.

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WORLD MARKETS 

European bourses are lower amid a report that the euro-zone 
manufacturing PMI rose to 44.1 in December from November's 43.6, 
reflecting continued contraction in the sector at a slightly 
slower pace. The Bloomberg European 500 index was down 1.2% as 
of 8:52 a.m. EST, paced by declines in telecom equipment and 
energy stocks. Banking stocks, including Spanish outfit 
Santander Bancorp (SBP,19.41), were also lower after Argentina's 
new president indicated that he would remove the Argentinean 
peso's peg to the U.S. dollar, raising devaluation concerns. The 
euro is higher against the dollar following a smooth, official 
transition to the new currency in the euro-region.

Asian stocks were generally higher, led by semiconductor stocks 
following Hynix Semiconductor's 30% increase in the price of its 
DRAM chips. Japan's Nikkei 225 index remains closed for a 
national holiday, while the yen is trading slightly lower 
against the dollar.

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FUTURES WATCH 

In the March Globex futures contract as of 8:52 a.m. EST, the 
S&P 500 index was unchanged while the Nasdaq 100 index was 9 
points higher (10 points above fair value). The March DJIA 
futures contract was up 49 points (1 point below fair value), 
and the February crude oil futures traded on the NYMEX were up 
$0.20 at $20.04/barrel.

William Johnson, Market Analyst

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