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by 9/14/2000 11:43 AM
Stocks quoted in this article:
One of the top names this morning on the NYSE new highs list is Cardinal Health (CAH – 85-3/4), which has stepped up marginally. Using the cohesive support of its upsloping 10-day moving average, the stock has risen by 25 percent from its near-term intraday low on August 8. In addition, the shares have performed well over the intermediate term, surging ahead by 134 percent over the past six months along the vigorous support of their ascending 10-week moving average.

Options players have mostly stayed away from CAH in spite of its impressive record of outperformance, as call activity has been relatively tame. As contrarians, we view this complacency as a bullish omen for the equity's prospects over the near term.


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by 9/14/2000 11:22 AM
Stocks quoted in this article:
Charles Schwab (SCH - 37) said today that although August was its slowest month so far this year, daily average trades rose 42 percent from the year-ago period. Total assets held in client accounts surpassed the $1 trillion mark in August, up 43 percent from August 1999. The stock is trading down fractionally this morning and remains within a tight, two-month trading range between approximately 35 and 40.

Yesterday, 21,757 contracts were added to the October 37-1/2 call, making it by far the site of peak open interest at 22,121 contracts. In today's option action, over 3,000 contracts have changed hands on the October 35 call. Two blocks of 1,500 and 1,000 contracts transacted between the bid and the ask, making it difficult to assess the investors' intentions. Open interest on the October 35 call amounts to only 390 contracts, so today's activity will likely result in new positions.
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by 9/14/2000 9:12 AM
Stocks quoted in this article:
Conexant Systems (CNXT – 37-1/16), a maker of communications chips, said late Wednesday that it will spin off its fastest-growing division, which designs semiconductors for equipment that runs the Internet. In response to this news, a brokerage firm upped CNXT from a "buy" to a "strong buy." The stock is poised to open today's trading higher by 11 points, or more than 29 percent. With this expected advance, the shares would clearly overtake their 10-week moving average, a trendline that the security hasn't closed a week above for the previous two months.


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by 9/13/2000 4:07 PM
Stocks quoted in this article:
The PHLX Semiconductor Index (SOX – 1007.1) snapped a three-session losing streak today with a two-percent advance to close above the 1000 mark. This comes in spite of the fact that industry leaders Intel (INTC – 61-1/4) and Advanced Micro Devices (AMD – 28-1/2) were both downgraded from "strong buy" to "market perform." INTC dropped over five percent, while AMD relinquished nearly six percent.

Leading the SOX higher was Rambus (RMBS – 84-15/32), which surged over 10 percent higher on news that it had entered a new licensing pact with NEC Corp. (NIPNY – 130-7/8). Another top SOX performer was Linear Technology (LLTC – 66-3/4), which gained three percent on the day. <
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by 9/13/2000 4:06 PM
Stocks quoted in this article:
This morning, Sherwin-Williams (SHW – 22-1/2) said that it expects third-quarter earnings to range between 66 and 69 cents per share, surprising analysts who were expecting the company to earn 73 cents per share. On a full-year basis, SHW expects to report earnings of $1.96 to $2.00 per share, while Street projections were for $2.06 per share. The security had almost six percent sliced from its value in reaction to this announcement.

This news stirred some activity in SHW's typically placid options pit. Volume on the September 20 put hit 400 contracts. Since this put has open interest of just 82 contracts, much of this activity should result in new positions, which is unusual given that the option will expire on Friday. Potential new positions were also initiated on the December 22-1/2 and March 22-1/2 puts on volume of 105 and 150 contracts, respectively. The December put has open interest of just 35 contracts, while open interest on the March contract is only 16 contracts. <
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