Schaeffer's Top Stock Picks for '25

Dow Jones Industrial Average, S&P Burned by Currency Woes

Why VIX Calls Are So Expensive

Aug 12, 2015 at 11:56 AM
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The Dow Jones Industrial Average (DJIA) is on track for another triple-digit loss, as China's second currency move in as many days is shaking investor confidence and sparking fears of a currency war. While Beijing did step in to stop the yuan's free-fall against the dollar, it's done little to stop the bleeding stateside, with the broader S&P 500 Index (SPX) struggling to stay in the black year-to-date.

Elsewhere, oil is on the mend after an encouraging demand forecast from the International Energy Agency and word that stockpiles fell for the third straight week, while job openings dipped more than expected in June. On a related note, New York Fed President William Dudley spoke to the central bank's role in the labor market, noting, "Monetary policy can help labor markets recover by providing incentives for firms to invest and grow (but it) cannot by itself solve skill mismatches that may exist in the economy."

 

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

 

  • How speculators are paying up to ease their nerves, per Schaeffer's contributor Adam Warner.
  • The China-based e-tailer -- and its newest partner -- swimming in red ink.
  • Plus ... Checking in on the CBOE Volatility Index (VIX), the SPDR S&P 500 ETF Trust (SPY), and other noteworthy stats at midday.

 

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Among the stocks with notable option volume is lighting expert Cree, Inc. (NASDAQ:CREE), with the contracts running at seven times the intraday norm. Digging deeper, buy-to-open activity may be transpiring at the weekly 8/14 26-strike call, which is CREE's most active option by far. At last check, the stock was up 5% at $26.47, but not before touching a three-year, post-earnings low of $23.36.

 

One of the top gainers on the Nasdaq is healthcare concern Myriad Genetics, Inc. (NASDAQ:MYGN), despite a guidance-induced round of negative analyst attention. At last check, the stock was up 7.8% at $33.51, attempting to climb into positive year-to-date territory.

 

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One of the leading advancers on the Big Board is home furnishings specialist Wayfair Inc (NYSE:W), which has rocketed 21% higher to $46.19 -- and to a record peak of $48.47. Boosting the shares are better-than-expected second-quarter results.

 

The CBOE Volatility Index (VIX) is up 1.9 points, or 13.8%, at 15.60.

 

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 2.76, with puts nearly tripling calls, and running at twice the average intraday clip. At last check, the SPY was down 3 points, or 1.4%, at $205.71.

 
 

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