Dow Jones Industrial Average Waffles Amid Consumer Sentiment, GDP Data

Fundamental events are negatively impacting Digital Ally, Inc. and Workday Inc

Nov 25, 2014 at 11:48 AM
facebook twitter linkedin

The Dow Jones Industrial Average (INDEXDJX:DJI) is slightly higher, as traders weigh a decline in consumer confidence against a better-than-expected preliminary gross domestic product (GDP) reading for the third quarter. Specifically, the Conference Board's consumer confidence index fell this month to its lowest level since June -- to 88.7 from a revised 97.1 in October -- while the GDP climbed to an annualized rate of 3.9%. At last check, the Dow was up 10.5 points, or 0.1%. Elsewhere, the S&P 500 Index (SPX) is down 2 points, and the Nasdaq Composite (COMP) has added 3.7 points.

Continue reading for more on today's market -- and don't miss:

  • How option bears and short sellers are getting burned by Qihoo 360 Technology Co Ltd's (NYSE:QIHU) earnings beat.
  • Schaeffer's contributor Adam Warner wonders whether rising volatility in the oil markets will spill over to stocks.
  • Plus ... Checking in on the CBOE Volatility Index (VIX), the SPDR S&P 500 ETF Trust (SPY), and other noteworthy stats at midday.

Midday Market Stats

Among the stocks with notable put volume is Coinstar parent Outerwall Inc (NASDAQ:OUTR), which has stumbled 2.5% to hover near $69.63 following yesterday's price hike at its Redbox kiosks. Specifically, puts are trading at 25 times the expected intraday rate, with attention being paid to the April 45 and 60 puts -- the equity's two most popular strikes. It appears one speculator is selling to open the lower strike and buying to open the higher, implementing a bear put spread in the hopes of additional long-term downside.

For more midday statistics and stocks on the move, head to page 2.

One of the major Nasdaq decliners is law enforcement equipment provider Digital Ally, Inc. (NASDAQ:DGLY), which is plunging in the wake of a grand jury decision last night not to indict a police officer for killing a teenager in Ferguson, Missouri. At last check, the stock was 6.6% lower at $13.13, just a day after rallying more than 12%. In terms of sentiment, more than one-quarter of DGLY's float is sold short, so this morning's sell-off is likely being cheered by at least one group of speculators.

Daily Chart of DGLY Since September 2014

Meanwhile, HR application designer Workday Inc (NYSE:WDAY) has stumbled after analysts panned the company's latest earnings results. Currently, the shares are down 5.6% to trade at $87.25. Taking a step back, the brokerage crowd is evenly divided on WDAY, which sports 11 "strong buy" ratings and an equal number of "hold" opinions.

The CBOE Volatility Index (VIX) is up a slim 0.03 point, or 0.2%, and remains at risk of finishing below 13 for a third straight session.

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 2.50, as puts more than double calls. SPY is down 0.4 point, or 0.2%, at $206.90.


Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners