Chase Calls Rise; Stocks Remain Strong

Interest-sensitive stocks are leading all three major averages higher Tuesday
just ahead of the Federal Reserve rate announcement due out at 2:15 PM ET. Banks
and broker/dealers are the biggest gainers of the day, while consumer stocks and
forest and paper products are the weakest.

At mid-day, the VIX has increased .19 to 19.75.

The OEX September 820 calls have risen 1 1/4 to 16 3/4.

Among bigger movers on heavier-than-average volume:

Chase Manhattan
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is up 1 1/2 to 52 7/16 to pace the banking index.
The Chase Manhattan September 55 calls are up 1/2 to 1 1/8 on triple the average
volume.

Microsoft
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has added 1 3/16 to 71 13/16, partly on news the
software giant had scored several tactical legal victories in the past few days.
The Microsoft September 70 calls are up 7/8 to 3 3/4.

Honeywell
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has risen 2 to 39 and is the top-performing Dow stock.
The Honeywell September 37 1/2 calls are up 1 1/4 to 2 3/8 on quadruple average
volume.

Tellabs
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is under pressure, falling 4 1/8 to 53 13/16 while the
Tellabs September 65 puts have jumped 3 3/8 to 11 on more than 2000 contracts.

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