Schaeffer's Trading Floor Blog

Biggest Movers: Groupon Inc, Qihoo 360 Technology Co Ltd, and SINA Corp

GRPN, QIHU, and SINA are making big moves in Tuesday's trading

by 6/24/2014 2:41 PM
Stocks quoted in this article:

With tech stocks leading the market this afternoon, three of today's top market movers are daily deals provider Groupon Inc (NASDAQ:GRPN), plus Chinese Internet concerns Qihoo 360 Technology Co Ltd (NYSE:QIHU) and SINA Corp (NASDAQ:SINA). Here's a quick roundup of how this trio of names is performing on the charts so far.

Yesterday's rally on GRPN rolled over into today's session, with the shares up 4.8% at last check to trade at $6.80. Option traders have responded enthusiastically to the stock's positive price action, and today, overall options volume is running at five times the intraday average. Of particular interest have been short-term calls, which account for four of the five most active strikes. Despite Groupon's recent uptick, the shares remain 42% lower year-to-date, and therefore, have a significant amount of short interest stacked up against them. In fact, 15.5% of the equity's float is currently sold short. As such, it is possible that short sellers -- hedging against more upside -- are responsible for some of this week's heavy call-buying activity.

QIHU has jumped 4.4% today to perch at $92.00, bringing the stock roughly 24% above its year-to-date low of $74.10 (tagged on May 7). Meanwhile, short interest on Qihoo 360 Technology Co Ltd spiked 64.8% over the last two reporting periods, and now accounts for a healthy 9.1% of the equity's available float. Today, QIHU call volume has ramped up to more than two times the expected intraday amount, echoing a withstanding trend in the stock's options pits. Over the past 10 trading days, the equity has racked up an International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 3.14, which ranks in the 86th annual percentile. In other words, calls have been bought to open over puts at accelerated pace in recent sessions. However, some of this long call activity may be attributable to short sellers picking up insurance against more upside.

SINA has fallen about 42% lower since the start of 2014, but is seeing a turn of events in today's session, currently up 6.7% to trade at $48.57. Elsewhere, SINA Corp traders have accumulated an annual-high level of put open interest (relative to call open interest) among options expiring within the next three months, as the equity's Schaeffer's put/call open interest ratio (SOIR) stands at a 12-month peak of 0.67. However, it appears SINA's positive price action today has inspired a bout of short-term call activity. To be specific, speculators are exchanging calls at more than two times the average intraday pace, with short-term strikes accounting for nine of the 10 most active options today.


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