Dow Jones Industrial Average Soars; S&P Flirts With New High

Dow Picks Up Where It Left Off; Plus, A New Volatility Vehicle

May 4, 2015 at 11:41 AM
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The Dow Jones Industrial Average (DJIA) has started the week on a strong note -- up more than triple-digits at one point -- and is building on last Friday's impressive gains. Helping feed today's risk-on appetite is stimulus speculation from overseas, as well as a rise in March factory orders. Elsewhere, the S&P 500 Index (SPX) came within 5 points of notching a new intraday peak earlier -- with help from solid earnings from Cognizant Technology Solutions Corp (NASDAQ:CTSH) -- while the Nasdaq Composite (COMP) is extending its lead over the 5,000 mark. Looking ahead, earnings season hits its stride this week, with quarterly results from blue chip Walt Disney Co (NYSE:DIS) and electric automaker Tesla Motors Inc (NASDAQ:TSLA) among the many names reporting.


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Among the stocks with notable put volume is Abercrombie & Fitch Co. (NYSE:ANF), with the contracts trading at two times the average intraday pace. The stock is down 3.2% at $21.79, after getting hit with an uninspiring brokerage note earlier, and it appears as if some speculators are gambling on additional losses for the teen retailer through week's end. Specifically, it looks as if new positions are being purchased at ANF's weekly 5/8 22.50-strike put.


One of the biggest gainers on the Nasdaq is BroadSoft Inc (NASDAQ:BSFT). The stock is up 15.4% at $37.21 -- and earlier tagged a new annual high of $37.50 -- after the software specialist turned in better-than-expected first-quarter results. Shares of BSFT are now up 28% year-to-date, and sitting comfortably above previous congestion in the $36 region.



American Eagle Outfitters (NYSE:AEO) is one of the leading advancers on the Big Board, after RBC initiated coverage on the shares with an "outperform" rating, and a $20 price target -- territory not charted by the retailer since August 2013. At last check, the security was up 4.2% at $16.62 -- and one option trader in particular bet big on more near-term upside.


The CBOE Volatility Index (VIX) is up 0.2 point, or 1.3%, at 12.86, but encountering resistance from its 10-day moving average.


Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 2.02, with puts doubling calls. SPY was last seen up 0.8 point, or 0.4%, at $211.54.



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