Dow Jones Industrial Average Kicks Off July on a High Note

What This Rare S&P 500 Signal is Saying

by Karee Venema

Published on Jul 1, 2015 at 12:02 PM

The Dow Jones Industrial Average (DJIA) has put a dreary finish to June -- and the second quarter -- behind it, and is kicking off a new month and quarter in fine fashion. The 30-stock index is up triple-digits at midday, amid speculation Greece could finally reach a bailout agreement with its creditors (despite the country missing last night's critical deadline and Prime Minister Alexis Tsipras continuing to call for a "no" vote at Sunday's referendum).

Also helping boost the blue-chip barometer is an M&A halo lift for Travelers Companies Inc (NYSE:TRV), as well as a round of upbeat economic data. Specifically, private payrolls -- which were released ahead of tomorrow's jobs report -- rose more than expected, manufacturing grew at its fastest rate in five months in June, and construction spending jumped to its highest level since October 2008.


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Among the stocks with notable put volume is Apollo Education Group Inc (NASDAQ:APOL), with the contracts crossing at 26 times the average intraday pace. The for-profit educator is down 2.6% at $12.54 -- and fresh off a 15-year low of $12.51 -- extending Tuesday's sharp losses. One speculator is betting on the bleeding to stop near the $9 mark, by selling to open a block of 7,190 November 9 puts.

Chubb Corp (NYSE:CB) is among the top gainers on the Big Board, surging 30.5% to $124.18. Earlier, the stock topped out at record high of $129.44, on reports the insurance issue will be scooped up by ACE Limited (NYSE:ACE) in a more than $28 billion deal. Adding to the bullish bias is a price-target hike to $124.13 from $103 at Sandler O'Neill. Today's gap has CB in the black on a year-to-date basis.


Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) is helping to lead the charge on the Nasdaq. The stock is up 15.9% at $20.25, after BofA-Merrill Lynch upgraded SCHN to "buy" from "underperform," citing steadying scrap prices, cost-cutting measures, and an appealing valuation. While the security remains in the red year-to-date, today's bull gap has SCHN on track to close north of its 200-day moving average for just the second time since last September.




The CBOE Volatility Index (VIX) is down 1.4 points, or 7.5%, paring its week-to-date advance to 19.5%.


Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.98, with puts nearly doubling calls. SPY is up 1.7 points, or 0.8%, at midday to linger near $207.50.


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