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by 10/4/2000 3:37 PM
Stocks quoted in this article:
Biovail (BVF – 74-1/4) is up over 10 percent this afternoon, reversing some of yesterday's 22-percent drop. Today, investors are reacting the news that BVF will acquire D.J. Pharma for $162.5 million plus the assumption of $50 million in debt.

The activity on the October 75 call noted in a Market Byte yesterday turned out to be additions. Open interest on the option rose by 1,010 contracts overnight to reach 1,947 contracts, which is the site of peak call open interest on the shares. Yesterday, 322 contracts were also added on the November 70 call. Option activity is relatively quiet so far today. <
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by 10/4/2000 3:01 PM
Stocks quoted in this article:
Avanex (AVNX – 97-9/16) is off over four percent in afternoon trading, continuing a slide that has seen the shares surrender 40 percent since their early-September high. During this descent, the stock has run up against staunch resistance from its 10-day moving average.

In AVNX's typically quiet options pit, two large blocks totaling 1,000 contracts crossed the tape at the bid on the far-out-of-the-money October 165 call. Since this option has open interest of just 511 contracts, this activity will likely yield new positions. <
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by 10/4/2000 3:01 PM
Stocks quoted in this article:
A district court refused to block IVX Corp. (IVX – 43.86) from marketing a generic version of Bristol-Myers Squibb's (BMY – 55-9/16) Taxol cancer drug. IVX is up over two percent in reaction to this ruling. In mid-August, the stock plunged on news that BMY had listed a newly issued patent on Taxol. However, IVX began recovering almost immediately after this drop. Since its August 17 low, the stock has appreciated by 80 percent.

During this advance, options players have gradually turned more optimistic. Schaeffer's put/call open interest ratio (SOIR) has declined from an annual high of 0.62 on September 14 to today's reading of 0.35. During this time frame, put open interest dropped by over 6,000 contracts, while call open interest decreased by only 2,800 contracts for options expiring within the next three months. For more information on SOIR, please visit Schaeffer's Daily Sentiment. <
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by 10/4/2000 2:58 PM
Stocks quoted in this article:
Remedy (RMDY – 16-9/16) makes help-desk software. The company's clients include eBay, Nike, and Minnesota Mining & Manufacturing. On July 26, the equity plunged roughly 20 points, or nearly 45 percent, on several brokerage downgrades following a second-quarter earnings announcement. The firm topped analysts' estimates in terms of earnings per share, but failed to meet revenue projections.

Since that fateful day over two months ago, RMDY has failed to overcome this bear gap and declined to a new annual low yesterday. The equity is continuing to trade below all significant short-term and long-term moving averages.

Today, RMDY is seeing some notable activity in the options pits, as the equity's October 15 put is the most-active put trading today on the CBOE. Exactly 10,000 contracts have traded at this strike, which was previously home to only 2,000 contracts. Just before 11:30 a.m., blocks of 9,000 and 1,000 contracts traded in rapid succession. The larger block was executed between the bid and the ask prices, while the 1,000-contract block traded off the ask. Additionally, 2,000 contracts have changed hands on both the October 17-1/2 and October 25 puts. Call activity is sparse today.
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by 10/4/2000 2:19 PM
Stocks quoted in this article:
Novellus Systems (NVLS – 46-7/8) makes semiconductor equipment. After encountering short-term resistance around the 63 level twice in September, the stock began a rapid descent lower, sloughing off over 30 percent between September 20 and yesterday's close. This decline has ushered the shares to potential double-bottom support around the 42 region.

Today, NVLS has been boosted more than 11 percent higher by a brokerage upgrade. Shortly after noon, brokerage behemoth Prudential named NVLS its "single best idea," while maintaining a "strong buy" rating on the equity. NVLS is now a mere chip shot away from overhead resistance at its 10-day moving average, which resides at the 48 level.
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