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by 11/30/2000 9:25 AM
Stocks quoted in this article:
For the week ended November 25, U.S. jobless claims rose unexpectedly by 19,000 to 358,000. This number was significantly higher than analysts' estimates, which called for a decrease of 6,000. The surge in jobless claims pushed the number of Americans filing first-time claims for unemployment to its highest level in more than two years, which further suggests that the tight U.S. labor market appears to be softening as the economy slows.<
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by 11/30/2000 9:24 AM
Stocks quoted in this article:
After the closing bell yesterday, Brocade Communications (BRCD - 153-3/4) announced fourth-quarter earnings of 22 cents per share, exceeding the Street consensus by two cents per share. BRCD provides switching solutions for storage area networks utilizing the fiber channel interconnect protocol. The company also announced a two-for-one stock split, effective December 22.

BRCD shares initially sold off after the news, with some extended-hours trades reaching down to the 142 level. Eventually, the price stabilized and the stock is actually trading slightly higher in pre-market activity today.

On the options front, peak front-month open interest rests in the December 150 put option with 10,470 open contracts. Ideally, one would like to see this level hold as support. If you are holding option contracts as of the stock split date, you will then have twice as many contracts at half the previous strike price. The option ticker symbol of the adjusted contracts will also change.
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by 11/30/2000 9:24 AM
Stocks quoted in this article:
Semiconductor firm Altera (ALTR - 25-15/16) is poised to move significantly lower on the open following news that the firm expects fourth-quarter revenue to approximate third-quarter revenue of $395 million. According to the firm, November resales were lower then management expectations in "all geographies." In pre-market activity, the equity is trading off roughly 30 percent.
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by 11/30/2000 9:10 AM
Stocks quoted in this article:
Personal computer maker Gateway (GTW - 29.50) looks to open substantially lower this morning. Last night after the closing bell, GTW announced that it expects fourth-quarter earnings-per-share of roughly 37 cents, which is 25 cents below Wall Street estimates. After ending the day at a price of 29.50 per share, the stock traded as low as 19.76 in after-hours activity.

There will likely be some disappointed options players today, as speculators have taken a bullish posture on GTW of late. Schaeffer's put/call open interest ratio (SOIR) for the stock presently stands at 0.79. This is lower than 76 percent of all annual SOIR readings. The site of heaviest call open interest is the December 45 call, which is home to 3,775 open contracts.
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by 11/29/2000 6:04 PM
Stocks quoted in this article:
Optical equipment maker Ciena (CIEN - 73) has fared better than most of its competitors during the Nasdaq slide the last few months. Until yesterday, the stock had been able to float around the range of its 10-day moving average, like a stranded swimmer clinging to a life preserver. But yesterday, it let go and today it is drowning in a sea of red, down over 17 percent on heavy volume. The catalyst appears to be rumors of another supplier signing a contract with CIEN's largest customer. For some time, there has been concern about the financial health of other CIEN clients that are telecommunications carriers. CIEN's next earnings report is due next week on December 7. That may calm the turbulence, but until then the shares would do well just to tread water.

Accompanying today's free fall is some significant options activity. The December 85 put has traded 13,319 contracts today, with 6,250 of those consisting of one block trade. Over 10,000 contracts of the December 95 put also changed hands. Most of this activity was two block trades of 5,000 each. Most other near-the-money options logged volumes in the 1,000-3,000 range. The December 85 put has open interest of only 895 contracts, so today's activity is likely new positions. The December 95 put, however, has open interest of 10,300, so today's trading could be openings and/or closings.
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