Your intraday options trading update.
Spec Money Moves into Tech
This morning’s rally is being tempered by continuing concerns over the nation’s general economic health along with stories about uncertainties in the Europe.
The market was buoyed this morning by news that non-farm payrolls rose by 244,000 jobs last month. Additionally, the big sell-off in commodities yesterday meant those traders need to get their money elsewhere.
“A lot of that money – especially the speculative money – has moved into tech and equities in general,” says Joseph Cusick, senior vice president and options analyst with OptionsXpress in Chicago.
The worry now is over a story in the German magazine Speigel that Greece is considering leaving the Euro zone.
Traders are watching as some of the broad market indicators are trading near support levels, for instance the SPDR S&P 500 (NYSE: SPY) is around 134. “It is holding but it’s being tested,” says Cusick.
On the equity and exchange-traded fund option side, Cusick notes that chip firms and others that use silver as an industrial metal are benefiting from the sell off in the commodity. The iShares Silver Trust (NYSE: SLV) dropped nearly 30% this week before bouncing this morning.
Sirius XM Radio (NASDAQ: SIRI) and Tyson Foods (NYSE: TSN) are two mid caps that have seen options activity today, he said. As a barometer of consumer stocks Sirius is seeing investors load up on calls. The TSN May 18 Puts “are trading briskly with about 80% of those being bought. People want to buy protection going into the weekend,” said Cusick who notes that the chicken giant reports quarterly earnings before Monday’s open.
Find more option analysis and trading ideas at Options Trading Strategies.
High Options Volume by Strike
The SPDR S&P 500 ETF (NYSE: SPY) and the iShares Silver Trust (NYSE: SLV) dominate the top 20 high-flying strikes today. The Spy MayWk 1 135 Put is down .58 to .62 as it expires this afternoon. Nearly 139,000 contracts trade. The SPY MAY Wk 134 trading nearly 90,000, down .46 to .14.
In SLV the May11 40 Call trades 77,000, down .03 to .42. In SLV the expiring WK May 35 Call and May34 Put are seeing about 50,000 contracts apiece. Will see if that baby can make it to 35 by day’s end, right now at 34.49.
Williams Co. (NYSE: WMB) enters the limelight with the WMB Jan 12 45 Call trading 50,000 contracts, down .05 to .30.
Major Stock Trading Volume Movers
Warner Music Group (NYSE: WMG) trades about 15 million shares, up .19 to 8.08 with Access Industries reportedly paying $3.3 billion for the music publisher. Equivalent of $8.25 a share. That’s a lot of Satisfaction.
More entertainment news with Pixelworks (NASDAQ: PXLW) announcing it would sell 3.65 million shares at 2.24 a share. Pixel does just what it sounds like. Trades 407,000 shares with last at 2.42.
Stocks/Underlying – Big Daily Change in Option Volume
Virgin Media (NASDAQ: VMED) trades nearly 19,000 options, a rise of about 3,300%, as the stock jumps 1.08 to 32.09. OptionMONSTER reports 16,000 Sep 34 Calls trade for $1.05 and $1.10 with open interest of 82 contracts.
Emerging market sector play iShares MSCI Taiwan Index (NYSE: EWT) trades 48,347 options as the ETF rises .19 to 15.87.
Stanley Black & Decker (NYSE: SWK) sees 21,320 options trade hands as stock drops .21 to 73.79.
Stocks/Underlying – High Option Volume
The SPDR S&P 500 ETF (NYSE: SPY) tops the 2 million mark in options contracts and is up .75 to 134.36. The Standard & Poor’s Index Options (CBOE: SPX) is up 6.53 to 1341.63 with 416,074 options trading.
The iShares Silver Trust (NYSE: SLV) trades 1.4 million options as it rallies a little, up .83 to 34.55. Come on 35.
The CBOE Volatility Index (CBOE: VIX) is up .45 to 18.65, with 240,772 options trading on the index.
Burney Simpson is the managing editor of InvestorPlace options pages.
