China Stimulus Speculation Has Dow Ready to Rally

Crude oil and gold are poised to resume their recent downtrend

Dec 2, 2014 at 8:17 AM
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The Dow Jones Industrial Average (INDEXDJX:DJI) is set to erase all of Monday's losses, as rumors of a fresh round of stimulus in China help buoy investor sentiment. Specifically, reports surfaced earlier that the People's Bank of China could unveil a plan to reduce banks' reserve requirements following a round of lackluster economic reports. Back on the homefront, carmakers Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM) should garner their fair share of attention, with November sales data due out. Also on the economic docket is construction spending, which is slated for release at 10 a.m. ET.

And now, on to the numbers...

Dow Jones Industrial Average, S&P and Nasdaq futures

Futures on the Dow Jones Industrial Average (INDEXDJX:.DJI) are more than 54 points above fair value.

Market Statistics

The Chicago Board Options Exchange (CBOE) saw 1.25 million call contracts traded Monday, compared to 776,232 put contracts. The resultant single-session equity put/call ratio fell to 0.62, while the 21-day moving average stayed at 0.59.

NYSE and Nasdaq summary

Volatility indices

Currencies and Commodities

  • The U.S. dollar index is up 0.4% at 88.30.
  • After posting its best single-day rally in more than two years on Monday, crude oil is ready to resume its recent downtrend today -- off 1.7% at $67.86 per barrel.
  • Elsewhere, gold is poised to surrender its short-term foothold atop $1,200, down 1.8% at $1,195.70 per ounce.
Currencies and commodities

Earnings and Economic Data

Auto sales data and construction spending are on today's docket. Bob Evans (BOBE) and OmniVision (OVTI) will dive into the earnings pool.

Overseas Trading

Markets in Asia settled higher today, as optimism over potential stimulus in China overshadowed Moody's downgrade of Japan's credit rating. A rally in financial stocks pushed the Shanghai Composite up 3.1%, to a fresh three-year peak. Meanwhile, exporters helped lead the charge in Japan, with the Nikkei closing 0.4% higher -- at a new seven-year high. Elsewhere, Hong Kong's Hang Seng tacked on 1.2%, while South Korea's Kospi eked out a 0.03% win.

European benchmarks are mostly in the green at midday, led by a surge in energy and mining stocks. At last check, London's FTSE 100 is up 1.2%, the French CAC 40 is 0.2% higher, and the German DAX is flirting with a 0.1% loss.

Overseas markets

Unusual Put and Call Activity:

For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations.

Unusual options activity - puts

Unusual options activity - calls


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