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by 11/3/2000 1:47 PM
Stocks quoted in this article:
PALM (PALM - 62-15/16) is up over six percent today, as it continues its relative-strength outperformance of the NASDAQ Composite (COMP - 3442.0). The shares have moved above the 61 level, which acted as resistance throughout October.

The most-active November PALM option today is the out-of-the-money 70 call, which has seen 1,823 contracts change hands. Open interest at this call strike is currently 11,717. Surprisingly, the heavist open interest in the November series is at the November 50 put, with over 18,000 contracts in residence. PALM will be added to the Nasdaq-100 Index (NDX - 3325.74) this coming Monday, November 6.
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by 11/3/2000 10:45 AM
Stocks quoted in this article:
We bring the following discussion up as it is highly pertinent to the bottom line of many U.S. corporations. You no doubt have heard about the negative impact of the weak euro (relative to the dollar) on corporate earnings numbers released over the past several weeks. This double-edged sword swings in both directions, however. As world economies were emerging from the depths of the 1998 markets, the U.S. government was determined to maintain a strong dollar, which was considered necessary to stave off inflationary pressures within our system (that was before the Fed started its intervention cycle).

The dollar continues to maintain its strength, especially compared to the infant euro currency. The weakness in the euro places a bottom-line burden on U.S. corporations from two facets. First, goods sold in the 11 euro-zone countries are paid for in the local currency. When they are deposited back overseas and exchanged to the U.S. dollar, some of the value dissipates in the exchange rates. Second, a strong dollar makes U.S. products more expensive in these regions. As a result, the competitive edge is diminished and sales shrink.

As mentioned in our "Before The Bell Section" today, the European Central Bank (ECB) intervened in currency markets to buy euros in a unilateral move that immediately lifted the region's currency. It is only the second time the central bank has acted on behalf of the euro. The ECB, which decides monetary policy in the 11 euro-nations, last intervened on September 22, coordinating with the U.S. Federal Reserve, the Bank of Japan, and other central banks.

The euro immediately rallied on the news to 0.8797 euros to the dollar before giving up most of those gains and falling back to hover just above 0.87. The European currency first broke below potential support at 0.89 in late August and has drifted lower ever since.

When a central bank shows itself willing to intervene in currency markets and buy , money traders are less willing to sell that currency for fear of being caught empty-handed if demand for that currency suddenly emerges. <
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by 11/3/2000 9:07 AM
Stocks quoted in this article:
This morning, the Labor Department released the October unemployment rate, non-farm payrolls, and average hourly earnings results. The U.S. unemployment rate came in at 3.9 percent, which was below estimates of 4.0 percent. Non-farm payrolls grew 137,000 versus estimates of a 180,000 advance. Average hourly earnings, however, rose at a 0.4-percent clip compared to last month's 0.2-percent increase. Although the unemployment rate remains at a 30-year low, businesses created fewer jobs, which bolsters the belief that the Federal Reserve will not raise interest rates anytime soon. As for the markets, the December contract of the S&P futures (SP/Z0 - 1439.50) is up 4.5 points, indicating a positive open.
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by 11/3/2000 8:54 AM
Stocks quoted in this article:
Last night after the close, it was reported that PepsiCo (PEP - 47-1/16) was in talks to acquire Quaker Oats (OAT - 82-1/4) for $13 billion in stock. Under the terms of the proposal, PEP would exchange 2.2 shares of its stock for each share of OAT. This would value OAT at roughly $100 per share, a 21.5-percent premium over yesterday's closing price. The talks, however, appeared to break down late last night as OAT rejected the offer as too low. For its part, PEP has refused to increase the offer amid concerns that a higher offer would dilute their per-share earnings.<
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by 11/3/2000 8:43 AM
Stocks quoted in this article:
In the past year, Tyco International (TYC - 56-5/8) shares have been able to weather the specter of accounting irregularities as well as a generally stormy market environment. In fact, the stock currently remains less than three points from an all-time high. Yesterday the December 60 call traded actively; over 15,700 contracts changed hands on this out-of-the-money call, with approximately 14,700 contracts of the volume translating into new open interest.<
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