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Techs eye Lucent, Alcatel deal

Long-awaited word of a merger between the two companies kicks off the trading week.

Two economic reports and the expected word of a Lucent-Alcatel merger will kick off the trading week Tuesday. The Dow is set to open slightly lower.

Investors will start the Memorial Day-shortened week with two economic reports. Consumer sentiment will be considered Tuesday when the private Conference Board issues its monthly survey. Economists expect the May reading to climb to 110.3 from 109.2 in April.

Also due is a report on personal income for April. Economists expect the index to have risen 0.3 percent for the month, compared with the 0.5 percent increase in March.

Stocks to Watch

  • Lucent will be the center of attention Tuesday as investors await a long-anticipated merger announcement. Reports have said Lucent and Alcatel could announce a deal as early as Wednesday. The Wall Street Journal said Tuesday that Alcatel would acquire Lucent for about $23.5 billion stock, with the deal excluding the Agere Systems chipmaking unit that would be spun off to existing Lucent holders.

  • OmniSky could also see some attention. The provider of wireless Internet and e-mail service raised its projections for the second quarter and 2001 to reflect growth expected as a result of News Corp. boosting its stake in the company.

    OmniSky said it expects a loss, including special charges, of $2.18 to $2.26 a share in 2001. The company was expected to have a loss of $2.28 a share, according to First Call.

    At the Bell

    The Dow Jones industrial average may open 22 points lower. The Standard & Poor's 500 index for June futures contracts was off 2.5 points to 1276 at 4:15 a.m. PDT in 24-hour electronic trading.

    Reuters contributed to this report.