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Dow 10K race, redux
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March 22, 1999: 7:29 a.m. ET
Investors to eye cable deal, takeovers, as Wall Street again watches 10,000
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NEW YORK (CNNfn) - Investors will be tuning in a big cable TV deal Monday to see if corporate mergers will give the market the push it needs to conquer, finally, Dow 10,000.
Stocks made their most convincing run at 10,000 so far Friday but blue-chips gave back their gains on weakness in IBM and other tech stocks late in the session. The Dow, which started Friday's trading less than three points away, ended down 94 from Thursday's record high at 9,903 . The S&P 500 and the Nasdaq composite, weighted with technology stocks, both fell.
While Comcast's $60 billion stock deal to buy cable television rival MediaOne could give stocks a boost Monday, it remains to be seen if the market can sustain the gains. That was the pattern last week as the Dow retreated each time it crossed 10,000, including Tuesday's brief ascent above that level for the first time in the Dow's 114-year history.
"People are very nervous," Larry Siebert, a money manager at Barrett Associates, told CNNfn's Business Day. He said investors "sort of struggle" with big milestones and that profit-taking often hits when the market crosses one.
The market looks set for a quiet start Monday with S&P futures on the Globex exchange system up about two points. Typically one point on the futures index equals eight points on the Dow as trading begins.
(Click here for the latest S&P futures quote)
Overseas, with Japan's markets closed for a holiday, stocks rose elsewhere in Asia and were mixed in Europe.
The dollar rose to 117.63 Japanese yen from 117.28 in New York late Friday and edged up to $1.0883 to the euro. In the bond market, the yield on the 30-year Treasury was little changed at 5.54 percent.
Investors are also nervously eyeing oil prices as producing nations set to meet Tuesday will try to ratify recent pledges to cut production. North Sea Brent crude oil rose 18 cents to $13.63 a barrel in London.
Stocks to watch include MediaOne (UMG) after Comcast agreed to pay $80.16 a share for the nation's No. 4 cable operator, a premium of 32 percent above MediaOne's $60.75 closing price Friday, which is up 50 percent since January. Comcast (CMCSK) fell 1/16 to 72-7/8.
Elsewhere on the merger front, Vivendi is close to acquiring California's U.S. Filter in a $6 billion deal that would give the French company an important toehold in the domestic water market, the Wall Street Journal reported. U.S. Filter (USF), the nation's biggest water utility, jumped 2-1/16 to 30-1/2 Friday.
The newspaper also reported that Microsoft plans to start talks to settle the government's antitrust case against the software giant. Microsoft (MSFT) fell 1-1/4 to 171-3/16.
America Online is set to announce steeper job cuts at Netscape after completing its $10 billion purchase of the maker of Internet browsers last week, according to published reports. AOL rose 3-1/8 to 119-1/4.
Due to report earnings, Cabletron Systems is expected to report a loss of 1 cent a share, according to First Call, which tracks analysts' estimates. Cabletron (CS), a maker of equipment for cable TV and other networks, rose 3/8 to 9-3/4.
Another stock to watch will be iVillage Inc., the women's online network that surged 234 percent to 80-1/8 Friday after going public Thursday at 24.
Little major economic news is expected.
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