Wednesday’s Vital Data: Twitter Inc (TWTR), Facebook Inc (FB) and Ford Motor Company (F)

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Stocks rebounded sharply on Tuesday, putting an end to a five-day losing streak. The S&P 500 added 1.24% after the index’s 200-day moving average once again provided a floor. That said, indications that the Federal Reserve is planning on moving ahead with an interest rate hike is creating some turmoil in premarket trading this morning.

In the options pits, volume is beginning to slow once again, despite a wealth of corporate earnings reports still on the docket. Overall, calls gained traction on Tuesday, with the CBOE’s single-session equity put/call volume ratio slipping to a near-term low of 0.62. The 10-day moving average held at a one-week high of 0.68 for the second session in a row.

In equity news, shares of Twitter Inc (NYSE:TWTR) are down nearly 10% in premarket trading after the company warned of slow user growth. Elsewhere in social media, Facebook Inc. (NASDAQ:FB) call traders are gearing up for tonight’s quarterly earnings report, while Ford Motor Company (NYSE:F) rallies behind record North American profit.

07-28-2015 Top Ten Options

Twitter Inc (TWTR)

TWTR stock rallied more than 5% on Wednesday, only to see those gains more than wiped away in after-hours trading. Wall Street appeared to welcome stronger-than-expected second quarter earnings, where Twitter reported a profit of 7 cents per share on a 61% spike in revenue.

However, growth in active monthly users was abysmal (up to 304 million from 302 million in the prior quarter). Furthermore, Twitter warned of continued slow user growth going forward, sending up red flags for investors.

Options traders were keyed up for Twitter gains heading into the report. Volume on the stock came in at a day’s-best 496,875 contracts, with TWTR options more popular on the day than Apple Inc.’s (NASDAQ:AAPL). Furthermore, calls accounted for 63% of the day’s activity. For weekly July 31 series options, peak put open interest of 10,974 contracts at the $34 strike are now solidly in the money. Look for more bearish activity today, with TWTR stock down sharply in premarket trading.

Facebook Inc (FB)

Call options are dominating FB stock’s backdrop heading into tonight’s report. Volume on the stock swelled to 429,491 contracts on Tuesday, with calls sweeping up 69% of the day’s activity. Furthermore, the total put/call open interest ratio on FB stock reveals that calls outnumber puts by a ratio of nearly two-to-one.

The out-of-the-money weekly July 31 series 100 call is currently home to peak open interest for FB options traders, with more than 37,000 contracts in residence. Arriving at a close second is the in-the-money 95 strike, which sport OI of 32,483 contracts.

Recapping expectations, Wall Street is currently looking for earnings to rise nearly 16% to 47 cents per share, with revenue seen spiking 37% to $4.03 billion. The current whisper number sits at 49 cents per share, according to EarningsWhisper.com.

Ford Motor Company (F)

Ford Motor made a rare appearance on the most active options listing on Tuesday. Volume came in at a record 257,194 contracts, with calls gobbling up 92% of the take. While some of this activity was related to Ford’s better-than-expected second-quarter earnings report, the vast majority was likely related to the stock going ex-dividend tomorrow.

Returning to Ford earnings, the company posted a second-quarter profit of 47 cents per share on revenue of $35.1 billion. Wall Street’s targets were set at 37 cents per share and $35.34 billion, respectively. Despite the lower revenue, Ford still made waves with a record North American profit of $2.6 billion.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/07/wednesdays-vital-data-twitter-inc-twtr-facebook-inc-fb-ford-motor-company-f-options/.

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