Your daily options trading wrap up.
Ford Motor (NYSE: F), 3M (NYSE: MMM), and Delta Airlines (NYSE: DAL) are among the names that saw post-earnings strength Wednesday. The Conference Board reported that its Consumer Confidence Index for April increased to 65.4, from 63.8 in March and better than the 64.4 that economists had predicted. Now, focus turns to Durable Goods data tomorrow morning and the Fed’s post-FOMC statement Wednesday afternoon. The Dow Jones Industrial Average is up 132 points late-Tuesday. The NASDAQ has added 27.5 and the CBOE Volatility Index (CBOE: VIX) edged down .40 to 15.37. Overall options volume is running about the typical levels, with 8.3 million calls and 6.3 million puts traded so far.
Microsoft (NASDAQ: MSFT) adds 26 cents to $25.86 and volume in the MSFT Apr 29 Weekly 26 Calls is approaching 12,000 contracts. The top trade is a 2,203-contract block at the 34-cent asking price. 78% of the volume is trading at the ask. Buyers appear to be driving the action ahead of earnings, due April 28 (after market). The Weeklys cease trading the next day and the 26 calls are .5% out-of-the-money with a delta of .50.
Yahoo (NASDAQ: YHOO) shares added 14 cents to $17.25 and recent option trades in the Internet search giant is a three-way spread, in which the investor apparently sold 25,000 YHOO Oct 15 Puts at 69 cents to buy the YHOO Oct 18 – 20 Call Spread at 63 cents, 25,000 on International Securities Exchange. Looks like a new position tied to 1.05 million shares at $17.25. Separately, the YHOO Oct 15 – Jul 19 Bullish Risk-Reversal trades at 15 cents, 21,000 times. It also looks opening and tied to 1.21 million shares at $17.19. YHOO shares added 4.6% on Apr. 20 after earnings were reported and are up another 2.3% since that time.
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Allied Nevada Gold (AMEX:ANV) adds $1 to $39.73 after the miner announced a discovery in a high-grade zone at Hoasbrouck, which includes both gold and silver. Shares may be shining but players in the options market are focused on ANV puts. The top trade is a 2,200-contract block of ANV Sep 30 Puts at the $1.05 asking price, 7,070 traded. June and Sep 35 puts are seeing interest as well. Some shareholders might be buying puts to protect recent gains in ANV, as the stock is up 153% since late-July. Earnings slated for May 5 (before market).
Implied Volatility Mover
Put buyers resurfaced in Longtop Financial (NYSE: LFT) Tuesday morning. Shares touched new 52-week lows and are down $1.54 to $24. The weakness is apparently due to negative note from Citron Research. Meanwhile, 23,000 puts and 5,600 calls have traded in the name so far. LFT May 20 Puts, which are 16.7% out-of-the-money and expire in three and half weeks, are the most active with 6,860 trades so far. May 15, May 22.5, May 25 and Jun 20 puts are seeing interest as well. Today’s volume seems to include of mix of put buyers and sellers. Some of the activity might be closing, as LFT, a Hong Kong-based software provider serving the financial industry, was the subject of bearish trading multiple times earlier this month. Shares are down in 11 of the past 12 trading sessions and have tumbled 26.5% during that time. Implied volatility is elevated at 88, up from 45 a month ago.
Bullish flow detected in Entropic Communications (NASDAQ: ENTR), with 3970 calls trading, or two times its recent average daily call volume.
Bullish flow detected in Parker-Hannifin (NYSE: PH), with 2351 calls trading, or four times the recent average daily call volume.
Bullish flow detected in Tractor Supply (NASDAQ: TSCO), with 3260 calls trading, or four times its recent average daily call volume.
Frederic Ruffy is the Senior Options Strategist at Whatstrading.com, a site dedicated to helping traders make sense of the complex and fragmented nature of listed options trading.