Thursday’s Vital Data: Boeing, Tesla and Square

U.S. stock futures are dancing around even this morning. Today continues the series of weak opens that have plagued the market ever since we started probing significant overhead resistance at 2,800 on the S&P 500.

Thursday's Vital Data: Boeing (BA), Tesla (TSLA) and Square (SQ)In early morning trading, futures on the Dow Jones Industrial Average are down 0.1% and S&P 500 futures are higher by 0.18%. Nasdaq-100 futures have gained 0.08%.

With some indexes fighting back into the green, call volumes made a comeback. Specifically, about 17.7 million calls and 14.3 million puts changed hands on the session.

The rebound in call activity pushed the CBOE single-session equity put/call volume ratio down to 0.54, which is nearing a two-month low. Meanwhile, the 10-day moving average held steady at 0.58.

Here were three popular stocks appearing on the most-active options list. Square (NYSE:SQ) saw renewed options interest ahead of its earnings release. Boeing (NYSE:BA) continues to fly high, fueled by its recent breakout. Finally, Tesla (NASDAQ:TSLA) shares popped after Elon Musk tweeted that news will be released on Thursday.

Let’s take a closer look:

Boeing (BA)

Boeing’s ongoing gravity defiance has been a sight to behold. Stellar fundamentals and share buybacks have proved a killer combo to fuel the aerospace juggernaut’s flight. With yesterday’s surge, BA stock is now up 35% year-to-date.

The technical catalyst for its recent strength was breaking out of its year-long base. Breakout traders often say “the longer the base, the higher in space,” and it’s certainly proving true in this case.

Wednesday’s pop sparked activity in the options market. By the closing bell, total volumes swelled to 127% of the average daily volume, with 92,228 total contracts traded. Calls contributed 55% to the sum.

The relentless rise has squashed implied volatility. Why be uncertain when the stock rises every single day? At least, that’s the prevailing sentiment. The implied volatility now sits at 24%, or the 15th percentile of its one-year range. Premiums are pricing in daily moves of $6.62, or 1.5%

Square (SQ)

Square shares have been on the mend this year, and we finally got a look at earnings to see if the recovery was justified. Last night the mobile payments company reported earnings of 14 cents per share on revenue of $464 million. Both measures surpassed the Street’s estimates of 13 cents and $454 million, respectively.

Rather than dwell on the past, however, traders looked to the future in judging whether this was a report worth celebrating. And that’s where the SQ stock fell short. First-quarter earnings guidance came in at 6 to 8 cents, well below the 11 cents analysts were looking for.

Tack on a slight slowdown in revenue growth and sellers ruled the roost after hours. Premarket, SQ is trading down 4.2% to $74.61.

On the options trading front, calls outpaced puts ahead of the number. Total activity climbed to 225% of the average daily volume, with 201,704 total contracts traded. 63% of the trading came from call options alone.

The expected move ahead of earnings was $6.08, or 7.7%, so this morning’s drop is in line with what options were baking in.

Tesla (TSLA)

Tesla shares, which were down 10.5% year-to-date ahead of yesterday’s session, rallied more than 5% after CEO Elon Musk said he would announce “news” for the company on Thursday. The buying binge is continuing with TSLA stock up another 1.46% premarket.

The excitement drove options trading well above average with calls dominating the session. Total activity jumped to 200% of the average daily volume with 349,422 total contracts traded. 58% of the sum came from call options.

The increased demand drove implied volatility higher on the day to 58% placing it at the 28th percentile of its one-year range. Premiums are pricing in daily moves of $11.45 or 3.6%

On the technical analysis front, TSLA remains one of the hardest stocks to game. Its price chart is a real chop-fest, driven by unpredictable news. At present, it sits in the middle of a whippy trading range, giving little edge to bulls or bears.

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.

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