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by 3/8/2001 3:29 PM
Stocks quoted in this article:
Philip Morris (MO – 50.98) has seen some smokin' activity in its options pits today, as the MO April 50 call has been one of the most-active call options trading on the AMEX today. Nearly 13,500 contracts have changed hands today, on an option that was previously home to less than 9,000 open calls. This suggests that at least some of today's volume should translate into new open interest tomorrow. Today's volume has primarily taken the form of large block trades that have been executed at or below the bid price.

MO has been one of the top-performing stocks in the equity market since mid-September and registered a new two-year high earlier today. In terms of relative strength, MO has been outperforming the S&P 500 Index (SPX – 1263.22) for nearly a year.

Surprisingly enough, options players are staking bearish claim on MO shares. The stock's Schaeffer's put/call open interest ratio (SOIR) stands at 0.98, meaning that total put open interest is nearly equal to total call open interest. This reading is higher than 98 percent of all SOIR numbers taken over the past year.
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by 3/8/2001 3:21 PM
Stocks quoted in this article:
Genentech (DNA – 47.00) is a top biotechnology firm that specializes in treatments for cancer and human growth hormones. In late-afternoon trading today, the shares are off more than seven percent following some disconcerting news on the research front. DNA officials announced the cancellation of an April 26 meeting with the Food and Drug Administration, at which the firm's asthma drug Xolair was scheduled to be reviewed. This catalyzed concern from investors that the drug's scheduled release date for later this year will be delayed.

Looming above the stock's current share price are more than 21,000 open contracts in the front-month series alone. Schaeffer's put/call open interest ratio (SOIR) for DNA presently stands at 0.41. This means that for every 100 open calls with up to three months of life remaining, there are only 41 puts. <
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by 3/8/2001 10:40 AM
Stocks quoted in this article:
The FDA has sent a warning letter to Eli Lilly (LLY – 76.23) after inspecting its Indianapolis injectable drug production plant. LLY says they will not have trouble complying with the FDA's standards, and that this will not affect their profits for the quarter. Schering-Plough (SGP – 38.38) also received the same type of communication from the FDA recently. The warning seems not to have had a great effect on share price, as LLY shares are trading down only .87 cents so far this morning.
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by 3/8/2001 9:35 AM
Stocks quoted in this article:
Warehouse retailer Costco (COST – 41-1/4) was one of the last retailers to report quarterly earnings this morning, and the news was not bad. COST exactly met Wall Street expectations of 38 cents per share profit. Last year the company earned a penny more, but sales grew by seven percent, and two percent for same-store sales for the second fiscal quarter. The stock opened slightly up on the news.
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by 3/8/2001 9:18 AM
Stocks quoted in this article:
Specialized semiconductor firm Cree (CREE – 25-7/16) is poised for a rocky day today, as the shares are trading over 20 percent in the red in pre-open trading. Last night, the company said that while its third-quarter earnings (which should be released on or around April 11) will match target estimates of 18 cents per share, it will not fare as well the next reporting period. For the fourth quarter, the company sees its earnings-per-share falling up to 15 percent below third-quarter results. The troublesome combination of slowing markets and increasing competition were cited as the primary reasons behind this struggle.

Tuesday, the shares edged higher to close solidly above their 10-day moving average for the first time since February 1. This short-term trendline will undoubtedly be breached when the stock opens for trading today. From a longer-term perspective, CREE has traded below its 10-month and 20-month moving averages for the past five months. These long-term trendlines are presently on the verge of a bearish crossover.

On the options front, speculators are positioned fairly bullishly. Schaeffer's put/call open interest ratio (SOIR) for the stock stands at 0.33, which ranks in the lower one-fifth of all readings over the past 12 months.
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