Stocks quoted in this article:
In Friday's trading, Chase Manhattan (CMB – 42-5/8) fell below the 44 area, which had served as the bottom of a long-term trading range since late December 1998. With this breakdown, the stock is now trending at levels not seen since the week of December 18, 1998. On a shorter-term basis, the shares have eroded by over 25 percent since mid-September.
This move lower sparked an increase in pessimistic sentiment from options players. On Friday, open interest on the October 40, October 45, and November 40 puts increased by 3,312, 3,555, and 2,564 contracts, respectively. On a longer-term basis, some traders were looking for an end to CMB's weakness. Open interest on the January 2002 50 call increased from 3,622 contracts to 10,360 contracts. This was one of the busiest calls on the CBOE on Friday.