Wednesday’s Vital Data: Netflix, Inc. (NFLX), Bank of America Corp (BAC) and General Electric Company (GE)

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The China-Fed roller coaster continued to take stocks for a ride on Tuesday, with the major market indices falling roughly 3% across the board. Wall Street will be closely scrutinizing all economic reports ahead of the Fed’s meeting for signs of an official delay to the anticipated interest rate hike. Currently, a Bloomberg survey of 54 economists reveals that 48% expect a September rate hike from the Fed.

The rise in fear Tuesday was reflected in a rise in option volume on the session, as puts once again regained popularity on Wall Street. Overall, the CBOE’s single-session equity put/call volume ratio reversed a two-day decline to arrive at 0.74. Furthermore, the 10-day moving average was pushed higher to a fresh annual high of 0.8.

Drilling down on equity options activity, Netflix, Inc. (NADSAQ:NFLX) is being besieged on all sides, as Apple Inc. (NASDAQ:AAPL) plans original TV content and Amazon.com Inc. (NASDAQ:AMZN) rolls out offline viewing for Prime. Elsewhere, Bank of America Corp (NYSE:BAC) trades ex-dividend today, driving heavy call volume, while General Electric Company (NYSE:GE) completed the sale of its U.S. fleets services business.

09-02-2015 Top Ten Options

Netflix, Inc. (NFLX)

NFLX stock was smacked for an 8% loss on Tuesday, after reports surfaced that Apple was in talks with TV producers for original content. The news also coincided with Apple’s announcement of a new Apple TV set-top box. Adding to the load on NFLX stock was a report that Amazon.com had beaten Netflix to the punch on offline viewing for on-demand videos — a feature that Netflix customers have long awaited.

As a result, put volume piled up on NFLX stock on Tuesday. Some 284,153 contracts traded on the stock, topping NFLX’s daily average over the past month. Furthermore, puts snapped up some 60% of Tuesday’s total activity. Options traders appear to be preparing for a continued selloff this week, as heavy put accumulations have appeared at the out-of-the-money weekly Sep 4 series $95 strike (8,842 contracts), $105 strike (5,262 contracts), and $100 strike (2,928 contracts).

In premarket trading, NFLX has recovered a bit, adding more than 2% to trade above $108.

Bank of America Corp (BAC)

With China and the Fed driving volatility, BAC stock has bounced around quite a bit during the past month. Yesterday, the stock was rejected at its 200-day moving average, as traders prepared for BAC to trade ex-dividend today. A cash dividend payout of 5 cents per share will be paid out on Sept. 25 to shareholders of record as of the close of trading on Sept. 1.  

With dividend speculation in play, call volume was well above average for BAC stock on Tuesday. Total volume swelled to a near-term high of 459,334 contracts, with calls accounting for 62% of the day’s take. In weekly Sep 4 series action, the $16.50 strike is home to peak open interest of 39,199 contracts, with another 29,781 contracts open at the deeper out-of-the-money $17 strike.

In premarket activity, BAC was last seen up 1% at $15.75.

General Electric Company (GE)

GE stock made a rare appearance on Tuesday’s most active options listing. The activity may have been due to price action as much as news that GE has completed the sale of its U.S. fleet services business. The fleet services business was sold to Element Financial Corp (ELEEF) for about $5 billion.

As for price action, GE stock continues to struggle with short-term resistance in the $24-$25 region, with the stock dipping back below former key support at $24 in Tuesday’s trading.  

Calls were top dog for GE on Tuesday. Volume rose to 100,548 contracts on the day, with calls snatching up 58% of the day’s total volume. In the weekly Sep 4 series, the $24-$25 region could be quite contentious for GE stock this week. Specifically, this region is home to heavy call and put open interest, with 2,819 call contracts at the $24.50 strike and 3,114 call contracts at the $25 strike. Meanwhile, the $24-$25 put strike sport open of more than 1,500 contracts each.

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/2015/09/wednesdays-vital-data-netflix-inc-nflx-bank-america-corp-bac-general-electric-company-ge-options/.

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