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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (37094)	5/21/2001 8:31:26 AM
From: Dealer	Respond to of 65232

Market Snapshot -- Stocks to take a bit of a breather By Julie Rannazzisi, CBS.MarketWatch.com Last Update: 8:11 AM ET May 21, 2001 NEW YORK (CBS.MW) -- Shares are set for some modest downside Monday, in a week that will give investors little to chew on both on the data and earnings front. June S&P 500 futures edged down 2.00 points, or 0.2 percent, and were trading roughly 1.30 points below fair value, according to HL Camp & Co. Nasdaq futures, meanwhile, lost 5.00 points, or 0.3 percent. In shares trading before the opening bell, Palm (PALM) climbed almost 7 percent, to $5.40 in Instinet dealings. UBS Warburg upped the stock to a "strong buy" from a "hold," citing the company's aggressive action in tackling its inventory problems. On Friday, Palm shares ended down over 28 percent following an earnings warning. The company was also bombarded with downgrades. Shares of Procter & Gamble (PG) slipped $1.80 to $65.68 in Instinet after the Dow company confirmed it's purchasing Bristol-Myers Squibb's Clairol unit for $4.95 billion in cash. Treasury action Government issues retreated a touch in early dealings. The 10-year Treasury note was off 1/32 to yield ($TNX) 5.41 percent while the 30-year government bond erased 6/32 to yield ($TYX) 5.78 percent. No economic news is set for release on Monday. The week's economic numbers will be few and far between, with April new home sales, durable goods orders, April existing home sales and the revision to first-quarter gross domestic product due out. View Economic Preview and economic calendar and forecasts. In the meantime, corporate bond issuance has slowed from its brisk pace in early May, which rating agency Moody's Investors Service notes has helped to narrow corporate bond yield spreads over the past couple of weeks. "After rising from 215 basis points at the end of April to a peak of 222 basis points when WorldCom issued its mammoth global bond on May 9, the average yield spread on long-term industrial bonds has since narrowed to 207 basis points," Moody's said in a research note. And thinning yield spreads have helped to offset the rise in borrowing costs due to the climb in long-term Treasury yields this year. "A 28 basis point spread narrowing has limited the effect of a 32 basis point year-to-date climb in Treasury yields to a smaller four basis point increase in long-term industrial yields," Moody's concluded. In the currency segment, dollar/yen slipped 0.3 percent to 123.22 while euro/dollar edged down 0.4 percent to 0.8765. --------------------------------------------------------------------------------