news analysis:
Plays of the week, I mean stories of the year

The Dow Jones Industrial Average received a makeover in 1999 to reflect a Big Board now driven by tech and consumer stocks

By Andrew Serwer Fortune Editor-at-large and Street Life columnist

(CNN) -- Here comes the verdict ... Judge Thomas Penfield Jackson (why do they always use his middle name?) indicates in his finding of fact that he will rule Microsoft guilty as charged: Monopolist. (We are shocked! Shocked!) Anyone following the U.S. Justice Department's two-year investigation and trial saw it coming a mile away. Once he issues his official verdict, the judge must decide what to do to Microsoft. Will it be breakup? Or simply shakeup? Meanwhile, investors seemed only moderately concerned. Which makes sense. It is hard to imagine Mister Softie losing its grip on the operating system software business -- never mind its market share in apps! -- anytime soon.

Dodging a bullet ... Earlier in the year the other half of the Wintel duo, Intel, managed to escape the clutches of federal regulators by settling with the Federal Trade Commission.

Troubled blue chips ... This was the year that a couple of one-time top-shelf companies fell from their perches. Coke was bashed by a contamination scare in Europe. Compaq acknowledged it was having problems, then gave the boot to CEO Eckhard Pfeiffer. Gillette was nicked, Disney hit the wall, and for Philip Morris, well, things went from bad to worse, as tobacco litigation worries continued to heat up.

Riding the merger wave ... Surf's up! Big deals continued to dominate the headlines in 1999. Among them:

• A health products troika? A three-way relationship remains possible involving American Home Products, Warner-Lambert and Pfizer, the latter having tried to swoop in while the other two were at the altar.
  
  
• CBS and Viacom: Sumner Redstone kept hearing whispers that he needed a successor. Mel Karmazin needed a bigger stage. And so a marriage made in heaven was made. It's MTV meets 60 Minutes.
  
  
• MCI/WorldCom and Sprint: Bernie Ebbers runs MCI/WorldCom out of Jackson, Mississippi, but his ambitions are global. After looking to combine his company with Sprint in a $129 billion merger, he now wants to pass AT&T.
  
  
• Clear Channel and AMFM: San Antonio's Clear Channel is now the biggest radio-station company in the world. It also has TV stations and a Texas-size billboard business. Not only that, but the hometown Spurs won the NBA championship. All in the same year. Dang!
  
  
• Phelps Dodge and Asarco: This, less than a week after completing negotiations with Cyprus Amax Minerals. As James Taylor would sing: "Down on Copperline."

The year of the networking IPO ... While everyone kept talking about Internet stocks going public, the real action was in networking equipment stocks. Foundry up 632 percent. Sycamore up 528 percent. Juniper up 702 percent. And Cobalt up 490 percent. Who needs Webvan anyway?

Dow 10,000, and then Dow 11,000, and then a revamped Dow ... It was a big year for the Dow Jones Industrial Average, breaking through first one millennium mark and then another. (Why, there was barely enough time to produce the special programs on the business TV news networks!) Then on November 1, the Dow got a makeover. Say goodbye to Dow dogs Union Carbide, Sears, Chevron and Goodyear. Say hello to Home Depot, SBC, Intel and Microsoft -- the latter two being the first NASDAQ companies to get invitations to join the Index of Indexes. Now if they would only weight the Dow by market capitalization! Right now, American Express counts more than Microsoft because it has a higher stock price. That makes a lot of sense!

Trading stock on the Internet has become increasingly more popular

NASDAQ 3,000 ... And speaking of records, the one-time junior exchange, NASDAQ, was breaking records of its own, and looking mighty impressive. Simply put, the tech-heavy NASDAQ was where most of the action was in 1999. Stocks such as Qualcomm, Sun Microsystems and Apple were the reasons. "Tech stocks rule! Industrials drool!"

Still time for E*Trade ... Merrill Lynch finally, finally decides to offer online trading to its customers. But only after Schwab and dot com competitors get a huge head start.

Andrew Serwer is editor at large at Fortune magazine and writes the Street Life column on Fortune.com.