Real-time equity news
U.S. stock market report
1726 EST 10Dec2010
Bulls eye Japan ETF January 2012 calls
Shares of the iShares MSCI Japan Fund edged down 3 cents to $10.58. In the options market, an impressive trade was initiated with a block of 50,000 January 2012 $11 strike calls bought-to-open at 69 cents per contract on the International Securities Exchange, said WhatsTrading.com options strategist Frederic Ruffy. The trade's break-even price at 2012 expiration is $11.69 and 10.4 percent above current levels.
The exchange-traded fund is up 10.6 percent since August, but has not traded north of $11.50 since the summer of 2008, Ruffy said. The trade drove up the fund's option volume to 7.2 times its average daily levels with about 54,000 calls and 2,543 puts traded on the day, Trade Alert data showed.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1649 ET 10Dec2010
Cisco attracts notable January call spread
An impressive January 2012 $17.5-$20 call spread was transacted on network equipment maker Cisco Systems Inc on Friday, said optionsXpress senior market analyst Joe Cusick. Its shares ended flat at $19.70. Cusick noticed that one player bought 20,000 January $17.5 calls at $3.70 per contract and sold the same amount of January $20 calls at $2.30 apiece. The spread, at a net debit of $1.40, offers a possible $1.10 pay-off, excluding commissions, if shares move above $20 and hold above that level through the January 2012 expiration.
'It might also be a position adjustment or a closing spread, as open interest is sufficient to cover in both contracts. Monday's open interest update will likely shed further light on the matter,' he added.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1627 ET 10Dec2010-S&P's move suggests further upside
analyst
The S&P's move above 'multi-layered' technical resistance at 1,229-1,227, a retracement level, suggests further upside in the stock market, said Chris Burba, short-term market technician at Standard & Poor's in New York.
'When a market surpasses a certain retracement level, then the probability increases of a rise to the next retracement level, which in this case would be a 76.4 percent retracement and that's up at 1,362,' he said.
Also, 'when you get to a new high for this up trend, that is basically telling you the crowd is willing to buy at higher prices, which tells you there's increased confidence that the market is going higher and people don't want to be left out,' Burba said.
As long as the S&P 500 stays above 1,219.5, 'the path of least resistance stays higher,' he added.
On the Nasdaq, he said, the next resistance is at 2,623.6.
Reuters Messaging: caroline.valetkevitch.reuters.com@reuters.net
1615 ET 10Dec2010
Option bulls target Pfizer January calls
Top drugmaker Pfizer Inc attracted bullish option flow after the company is voluntarily recalling its drug Thelin to treat a life-threatening lung condition and will end studies of the pill after it was linked to potentially deadly liver toxicity. For details, see
Traders favored the January $16 and $17.5 strike calls and volume in these options reached 23,632 and 32,816 contracts, respectively, said Patrick Mortimer, director of options trading at Pipeline Trading Systems. The majority of the activity took place on the offers and it looks like traders are looking for Pfizer to break through the $18 level, he added, The shares have not been that high since early February when Pfizer posted disappointing fourth-quarter profits and gave a lackluster forecast. Pfizer's Chief Executive abruptly resigned on Sunday after nearly five years on the job.
'During his tenure Pfizer's shares slumped nearly 27 percent, so today's activity could be a vote of confidence for the new man in charge Ian Reed,' Mortimer said. Investors seem to be shrugging off the recall with the shares up so far, he said. Pfizer rose 1.55 percent to $17.02.
Reuters Messaging: doris.frankel.reuters.com@reuters.net Keywords: MARKETS STOCKSNEWS
COPYRIGHT Copyright Thomson Reuters 2010. 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.
U.S. stock market report
1726 EST 10Dec2010
Bulls eye Japan ETF January 2012 calls
Shares of the iShares MSCI Japan Fund edged down 3 cents to $10.58. In the options market, an impressive trade was initiated with a block of 50,000 January 2012 $11 strike calls bought-to-open at 69 cents per contract on the International Securities Exchange, said WhatsTrading.com options strategist Frederic Ruffy. The trade's break-even price at 2012 expiration is $11.69 and 10.4 percent above current levels.
The exchange-traded fund is up 10.6 percent since August, but has not traded north of $11.50 since the summer of 2008, Ruffy said. The trade drove up the fund's option volume to 7.2 times its average daily levels with about 54,000 calls and 2,543 puts traded on the day, Trade Alert data showed.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1649 ET 10Dec2010
Cisco attracts notable January call spread
An impressive January 2012 $17.5-$20 call spread was transacted on network equipment maker Cisco Systems Inc on Friday, said optionsXpress senior market analyst Joe Cusick. Its shares ended flat at $19.70. Cusick noticed that one player bought 20,000 January $17.5 calls at $3.70 per contract and sold the same amount of January $20 calls at $2.30 apiece. The spread, at a net debit of $1.40, offers a possible $1.10 pay-off, excluding commissions, if shares move above $20 and hold above that level through the January 2012 expiration.
'It might also be a position adjustment or a closing spread, as open interest is sufficient to cover in both contracts. Monday's open interest update will likely shed further light on the matter,' he added.
Reuters Messaging: doris.frankel.reuters.com@reuters.net
1627 ET 10Dec2010-S&P's move suggests further upside
analyst
The S&P's move above 'multi-layered' technical resistance at 1,229-1,227, a retracement level, suggests further upside in the stock market, said Chris Burba, short-term market technician at Standard & Poor's in New York.
'When a market surpasses a certain retracement level, then the probability increases of a rise to the next retracement level, which in this case would be a 76.4 percent retracement and that's up at 1,362,' he said.
Also, 'when you get to a new high for this up trend, that is basically telling you the crowd is willing to buy at higher prices, which tells you there's increased confidence that the market is going higher and people don't want to be left out,' Burba said.
As long as the S&P 500 stays above 1,219.5, 'the path of least resistance stays higher,' he added.
On the Nasdaq, he said, the next resistance is at 2,623.6.
Reuters Messaging: caroline.valetkevitch.reuters.com@reuters.net
1615 ET 10Dec2010
Option bulls target Pfizer January calls
Top drugmaker Pfizer Inc attracted bullish option flow after the company is voluntarily recalling its drug Thelin to treat a life-threatening lung condition and will end studies of the pill after it was linked to potentially deadly liver toxicity. For details, see
Traders favored the January $16 and $17.5 strike calls and volume in these options reached 23,632 and 32,816 contracts, respectively, said Patrick Mortimer, director of options trading at Pipeline Trading Systems. The majority of the activity took place on the offers and it looks like traders are looking for Pfizer to break through the $18 level, he added, The shares have not been that high since early February when Pfizer posted disappointing fourth-quarter profits and gave a lackluster forecast. Pfizer's Chief Executive abruptly resigned on Sunday after nearly five years on the job.
'During his tenure Pfizer's shares slumped nearly 27 percent, so today's activity could be a vote of confidence for the new man in charge Ian Reed,' Mortimer said. Investors seem to be shrugging off the recall with the shares up so far, he said. Pfizer rose 1.55 percent to $17.02.
Reuters Messaging: doris.frankel.reuters.com@reuters.net Keywords: MARKETS STOCKSNEWS
COPYRIGHT Copyright Thomson Reuters 2010. 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.