Stocks on the move
Real-time Equity news
U.S. stock market report
1732 ET 21Aug2009
U.S. economic diary for Aug. 24
The day's economic agenda includes Chicago Fed Index for July, scheduled for release at 8:30 a.m. EDT (1230 GMT).
For more information, please click
Reuters Messaging: angela.moon.reuters.com@reuters.net
1719 ET 21Aug2009-US STOCKS
Wall St ends at new highs for the year
U.S. stocks ended the week at 2009 highs on Friday after a surprising rise in home sales and optimistic comments from Federal Reserve chief Ben Bernanke reassured investors about the prospects for an economic recovery.
The S&P 500 and the Nasdaq hit 10-month intraday highs, while the Dow industrials rose to their highest level in nine months.
The Dow Jones industrial average rose 155.91 points, or 1.67 percent, at 9,505.96. The Standard & Poor's 500 Index gained 18.76 points, or 1.86 percent, at 1,026.13. The Nasdaq Composite Index was up 31.68 points, or 1.59 percent, at 2,020.90.
For the week, the Dow rose 2 percent, the S&P 500 gained 2.2 percent and the Nasdaq rose 1.8 percent.
For detailed report, click
Reuters Messaging: angela.moon.reuters.com@reuters.net
1544 ET 21Aug2009 Caterpillar draws likely bullish option play
Shares of Caterpillar Inc, the maker of construction and mining equipment, rose 3.76 percent to $47.21 in late trade. In the options patch, 20,000 puts were bought at the January 2010 $40 strike for a premium of $2.72 apiece. At first glance this looked bearish. 'However, we believe the puts are likely tied to the acquisition of an equivalent number of shares of the underlying stock, and is thus a bullish play,' said Andrew Wilkinson, market analyst at Interactive Brokers Group. The purchase of so-called 'married' puts provides downside protection through January expiration. Wilkinson surmised the investor is hoping to see the Caterpillar stock appreciate, but is immune from losses beneath the breakeven share price of $37.28. The puts are deep out-of-the-money. Thus, downside protection would not kick in unless the player had already experienced a more than 20 percent fall in the value of the underlying shares, he said.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1517 ET 21Aug2009 Player initiates combo hedge trade in VIX
A combination hedged strategy in the CBOE Volatility Index (.VIX) was initiated on Friday when an investor bought 80,000 November 40 VIX calls and simultaneously sold 20,000 Nov 25-27.50 strangles. He collected 79 cents for the transaction which was tied to the sale of November VIX futures at 29.50.
This appeared to be a hedged bet that the volatility index would stay somewhere below 28.50 by November expiration. 'This is basically a short premium position that was traded Delta neutral with the idea that the VIX will stay below 28.50 by November expiration,' said Dan Deming, a trader at Stutland Equities. 'The fact that he bought a bunch out-of-the money November calls protects him against an explosive rise in volatility.' The order is part of an ongoing trend where investors have been buying upside call strikes in the VIX as inexpensive insurance against a rise in volatility.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1435 ET 21Aug2009
Fannie Mae traders price in big share moves
The risk surrounding the potential for sharp moves in Fannie Mae's share price increased as the stock's average option implied volatility popped up. Shares of the largest provider of U.S. home mortgage funding rose 10 percent to $1.21 in afternoon trade. About 32,000 calls vs. 2,693 puts traded in the name, on combined volume double the norm. Traders focused on the $1 and $2 calls with expiration months ranging from September to March 2010, said WhatsTrading.com option strategist Frederic Ruffy. FNM's implied volatility stood at 168 percent, up from 122 percent the previous session. It was up as much as 190 percent on Aug. 14. Meanwhile, Freddie Mac's implied volatility is falling and is 162 percent, from 190 percent on Thursday, as traders sold the January 2010 $2.50, September $2, and January 2010 $1 calls, he said. Freddie shares rose 10.62 percent to $1.77, and 8,832 calls and 3,103 puts traded.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1423 ET 21Aug2009
KPN extends tender offer for iBasis
Dutch telecoms group KPN extended its $48 million tender for the remaining stake of iBasis Inc. it does not already own. iBasis, a U.S. wholesale telephone call carrier, says the offer grossly undervalues the company.
KPN said in a statement that its $1.55 per share offer for iBasis, which filed a lawsuit against KPN earlier this week, will now expire on Oct. 23.
For details, see
Shares of iBasis gained 2.6 percent to $2.35.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
Keywords: MARKETS STOCKSNEWS
COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Real-time Equity news
U.S. stock market report
1732 ET 21Aug2009
U.S. economic diary for Aug. 24
The day's economic agenda includes Chicago Fed Index for July, scheduled for release at 8:30 a.m. EDT (1230 GMT).
For more information, please click
Reuters Messaging: angela.moon.reuters.com@reuters.net
1719 ET 21Aug2009-US STOCKS
Wall St ends at new highs for the year
U.S. stocks ended the week at 2009 highs on Friday after a surprising rise in home sales and optimistic comments from Federal Reserve chief Ben Bernanke reassured investors about the prospects for an economic recovery.
The S&P 500 and the Nasdaq hit 10-month intraday highs, while the Dow industrials rose to their highest level in nine months.
The Dow Jones industrial average rose 155.91 points, or 1.67 percent, at 9,505.96. The Standard & Poor's 500 Index gained 18.76 points, or 1.86 percent, at 1,026.13. The Nasdaq Composite Index was up 31.68 points, or 1.59 percent, at 2,020.90.
For the week, the Dow rose 2 percent, the S&P 500 gained 2.2 percent and the Nasdaq rose 1.8 percent.
For detailed report, click
Reuters Messaging: angela.moon.reuters.com@reuters.net
1544 ET 21Aug2009 Caterpillar draws likely bullish option play
Shares of Caterpillar Inc, the maker of construction and mining equipment, rose 3.76 percent to $47.21 in late trade. In the options patch, 20,000 puts were bought at the January 2010 $40 strike for a premium of $2.72 apiece. At first glance this looked bearish. 'However, we believe the puts are likely tied to the acquisition of an equivalent number of shares of the underlying stock, and is thus a bullish play,' said Andrew Wilkinson, market analyst at Interactive Brokers Group. The purchase of so-called 'married' puts provides downside protection through January expiration. Wilkinson surmised the investor is hoping to see the Caterpillar stock appreciate, but is immune from losses beneath the breakeven share price of $37.28. The puts are deep out-of-the-money. Thus, downside protection would not kick in unless the player had already experienced a more than 20 percent fall in the value of the underlying shares, he said.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1517 ET 21Aug2009 Player initiates combo hedge trade in VIX
A combination hedged strategy in the CBOE Volatility Index (.VIX) was initiated on Friday when an investor bought 80,000 November 40 VIX calls and simultaneously sold 20,000 Nov 25-27.50 strangles. He collected 79 cents for the transaction which was tied to the sale of November VIX futures at 29.50.
This appeared to be a hedged bet that the volatility index would stay somewhere below 28.50 by November expiration. 'This is basically a short premium position that was traded Delta neutral with the idea that the VIX will stay below 28.50 by November expiration,' said Dan Deming, a trader at Stutland Equities. 'The fact that he bought a bunch out-of-the money November calls protects him against an explosive rise in volatility.' The order is part of an ongoing trend where investors have been buying upside call strikes in the VIX as inexpensive insurance against a rise in volatility.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1435 ET 21Aug2009
Fannie Mae traders price in big share moves
The risk surrounding the potential for sharp moves in Fannie Mae's share price increased as the stock's average option implied volatility popped up. Shares of the largest provider of U.S. home mortgage funding rose 10 percent to $1.21 in afternoon trade. About 32,000 calls vs. 2,693 puts traded in the name, on combined volume double the norm. Traders focused on the $1 and $2 calls with expiration months ranging from September to March 2010, said WhatsTrading.com option strategist Frederic Ruffy. FNM's implied volatility stood at 168 percent, up from 122 percent the previous session. It was up as much as 190 percent on Aug. 14. Meanwhile, Freddie Mac's implied volatility is falling and is 162 percent, from 190 percent on Thursday, as traders sold the January 2010 $2.50, September $2, and January 2010 $1 calls, he said. Freddie shares rose 10.62 percent to $1.77, and 8,832 calls and 3,103 puts traded.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1423 ET 21Aug2009
KPN extends tender offer for iBasis
Dutch telecoms group KPN extended its $48 million tender for the remaining stake of iBasis Inc. it does not already own. iBasis, a U.S. wholesale telephone call carrier, says the offer grossly undervalues the company.
KPN said in a statement that its $1.55 per share offer for iBasis, which filed a lawsuit against KPN earlier this week, will now expire on Oct. 23.
For details, see
Shares of iBasis gained 2.6 percent to $2.35.
Reuters Messaging: ryan.vlastelica.reuters.com@reuters.net
Keywords: MARKETS STOCKSNEWS
COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.