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by 6/28/2000 11:11 AM
Stocks quoted in this article:
Yesterday after the close, Motorola (MOT - 30-1/2) announced that its Propel unit had filed with the SEC for an initial public offering of about 20 percent of its stock. MOT is down fractionally this morning. The equity took a hit on Monday when it was downgraded by a major brokerage firm. There is some action in MOT's options pit today. The January 2003 35 call has seen 2,510 contracts cross the tape compared to its open interest of 2,469 contracts. Much of the activity on this option transpired between the bid and the ask, making it difficult to gauge the investors' intentions. This is one of the busiest call contracts on the AMEX. On the put side, the January 26-5/8 strike has logged volume of 3,100 contracts versus open interest of 4,058 contracts. A 1,900-contract block traded near the ask this morning. Over 2,000 contracts have changed hands on the January 30 put, which has open interest of 11,257 contracts. Several mid-sized blocks transacted near the ask on this option. <
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by 6/28/2000 11:11 AM
Stocks quoted in this article:
Micron Technology (MU - 91) got a boost this morning when it was named as one of "10 Uncommon Values" by a major brokerage firm. The stock has ramped over 80 percent higher since its early-May low and is within a chip shot of an all-time high. The July 95 call is seeing some action this morning, with 1,124 contracts crossing the tape on open interest of 4,003 contracts. The July 85 put has registered 1,240 contracts in volume compared to its open interest of 3,554 contracts. This is one of the most-active puts on the Pacific Exchange.<
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by 6/28/2000 11:05 AM
Stocks quoted in this article:
It appears that a huge bearish calendar spread was initiated on Apple Computer (AAPL - 52-11/16) yesterday, with over 16,000 contracts trading on the July 45 and August 45 puts. Trades of this size would indicate institutional involvement. It appears that they sold the front-month put at 1-1/16 to partially finance the purchase of the September 45 put at 2-5/16 for a net debit of 1-1/4. The purpose of a calendar spread that uses out-of-the-money options is to take advantage of the accelerating erosion in time premium of the written front-month option relative to the purchased back-month position. AAPL is up more than one percent this morning. On the options front today, 2,924 contracts have traded on the out-of-the-money August 55 call, which has open interest of 447 contracts. This is currently one of the most-active call contracts on the AMEX.<
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by 6/28/2000 10:01 AM
Stocks quoted in this article:
Archer-Daniels-Midland (ADM - 10-1/8) makes food additives and ingredients for packaged-food companies. The stock is up fractionally this morning, as it continues to battle overhead resistance from its descending 10-day moving average. The shares have not finished a session above this short-term trendline since June 7. Since notching a near-term intraday high on June 1, the equity has declined by more than 19 percent. In ADM's options pit today, investors are apparently showing faith in the security's potential, as 1,800 contracts have crossed the tape on the out-of-the-money December 12-1/2 call. This strike has open interest of 1,034 contracts, so some of today's volume should translate into new positions. Currently, this is the most-active call on the PHLX.
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by 6/28/2000 9:01 AM
Stocks quoted in this article:
In what may turn out to be a "fly in the ointment," this morning's release of the May durable goods orders report presented a major upside surprise. May durable goods orders increased by 6.0 percent, exceeding expectations of a 2.8-percent gain. Additionally, the April figures, which originally showed a sharp decline, were revised upward from a 6.4-percent decline to a 5.7-percent decline. This indicator of the demand for big-ticket items posted its largest advance in five months and calls into question the effectiveness of the recent bout of interest-rate increases. The S&P 500 Index September futures contract, which had been trading positive all morning (reaching as high as 1476.50), quickly retreated to negative territory following this news.
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