Recent observations at Jicamarca, Peru, of VHF radio signals coherently scattered from the upper equatorial E region during midday hours show that the corresponding irregularities in the electron density distribution are aligned along the earth's magnetic field. Vertical electron drift velocities in the altitude region between 120 km and 170 km show spatial and temporal variations of as much as 30%. These variations are attributed to small-scale varying electric fields which are generated by the dynamo action of gravity waves in the neutral atmosphere.