U.S. stock futures are trading higher this morning as the desperately needed rebound looks to extend its gains for the third day in a row.
Ahead of the bell, futures on the Dow Jones Industrial Average are up 0.51% and S&P 500 futures are higher by 0.43%. Nasdaq-100 futures have added 0.25%.
In the options pits, call volume outpaced puts even as overall volume levels fell back on the day. Specifically, about 17.6 million calls and 16.3 million puts changed hands on the session.
At the CBOE the single-session equity put/call volume ratio rose to 0.73. Meanwhile, the 10-day moving average ticked higher to a new 2018 high of 0.82.
Here are three of the stocks landing atop the most-actives list yesterday. Coca-Cola (NYSE:KO) and Ford (NYSE:F) saw renewed options interest on technically driven rebounds. And Intel (NASDAQ:INTC) benefited from recent news out of Israel regarding a $185 million grant and planned $5 billion production expansion.
Let’s take a closer look:
Coca-Cola (KO)
KO stock has enjoyed a two-day snapback that reclaimed all that was lost on Christmas Eve’s historic market selloff. And with that, the soft drink giant is within striking distance of its record highs.
Company-specific news was absent yesterday, but that didn’t stop traders from jumping into the options market to place their bets. Consumer staples like KO stock have held up very well amid the market turmoil. With this week’s rapid recovery, Coke is now up 3.6% year-to-date.
On the options trading front, traders came after calls with a vengeance. Activity swelled to 390% of the average daily volume, with 89,811 total contracts traded. 85% of the trading came from call options alone.
Implied volatility retreated to 27% placing it at the 77th percentile of its one-year range. Premiums are now pricing-in daily moves of 80 cents or 1.7%.
Ford (F)
Ford shares are fighting back after notching a new nine-year low amid continued economic slowdown worries and tariff trauma. The past two trading sessions sport a pair of bottoming tails showing sharp intraday bullish reversals. The turnaround attempts come as buyers seek to salvage something (anything!) from a dreadful December.
With F stock submerged beneath all major moving averages and potential resistance aplenty, any rally that arrives over the coming days should be eyed with extreme skepticism.
On the options trading front, calls dominated the session. Activity increased to 138% of the average daily volume, with 105,828 total contracts traded. Calls contributed 71% of the day’s total.
Implied volatility held steady on the day to 54% placing it at the 89th percentile of its one-year range. Premiums are pricing in daily moves of 27 cents or 3.4%.
Intel (INTC)
Considering the bloodbath the Nasdaq is currently suffering, Intel’s resilience in Q4 is downright impressive. Due to a lift in call activity, the chip giant found itself on yesterday’s most-active list. The only major news hitting the wires over the past week came via Reuters and outlined how Israel was giving Intel a $185 million grant “in return for a planned $5 billion expansion of its production operations in Israel.”
The price trend for INTC stock has flattened, which is a win when compared to the broader market’s dramatic descent. I suggest waiting for a break of either $50 or $43 before getting overly affectionate about a directional move.
On the options trading front, calls outpaced puts on the day. Total activity lifted to 133% of the average daily volume, with 95,407 total contracts traded. Calls accounted for 61% of the day’s take.
Implied volatility slid slightly on the day to 41% placing it at the 81st percentile of its one-year range. Premiums are pricing in daily moves of $1.20 or 2.6%
As of this writing, Tyler Craig didn’t hold a position in any of the aforementioned securities. Check out his recently released Bear Market Survival Guide to learn how to defend your portfolio against market volatility.
