WALL STREET STOCKS/COMPAQ COMPUTER <CPQ>
Compaq Computer Corp, IBM's chief
rival in the personal computer market, scored a big gain on
Wall Street today. Compaq's stock rose 1-3/8 to 32-1/4 on
volume of 1.3 mln shares.
    "The rationale for the move," one trader said, "is that the
damage from the IBM announcement yesterday was less than
expected." He said Compaq's stock had been under pressure
recently because of anticipation of IBM's unveiling of a new
line of personal computers.
    International Business Machines <IBM> introduced four new
personal computers and more than 100 new peripheral products.
But analysts said the new computers, though they do contain a
lot of proprietary concepts, will not be as hard to copy as
some other PC makers had feared.
    "The long range issue here is who wins and who loses in the
PC business, and that issue was not resolved yesterday and is
unlikely to be decided any time soon," analyst Mark Stahlman of
Sanford C. Bernstein and Co said.
    Stahlman reaffirmed his recommendation of Compaq and Apple
Computer Inc <AAPL>.
    Stahlman said "The critical investment question now is who
will have a pickup in sales in the near term. We expect to see
a strong demand setting for PCs for the rest of this year, and
that will boost the revenues for all of the major PC vendors."
    "The first quarter was the strongest PC sales period on
record for Compaq, Apple and IBM," Stahlman said, "and I don't
think the IBM announcement is going to change that trend soon."
    "In anticipating the IBM announcement, Compaq has made
pricing adjustments necessary to compete for its immediate
purposes," he said.
 Reuter
