Dow Jones Industrial Average Dips as Traders Eye Oil, Data

Bill Ackman Has Big Friday Plans

Oct 27, 2015 at 11:58 AM
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The Dow Jones Industrial Average (DJIA) is in the red at midday, as traders weigh sinking oil prices -- and subsequent declines for Chevron Corporation (NYSE:CVX) and Exxon Mobil Corporation (NYSE:XOM) -- against positive earnings reactions for blue chips DuPont (NYSE:DD), Pfizer Inc. (NYSE:PFE), and Merck & Co., Inc. (NYSE:MRK). The latest batch of economic data isn't doing the bulls any favors, either. Orders for durable goods dropped again last month, consumer confidence unexpectedly declined, and output in the services sector fell to a nine-month low.

Looking ahead, traders are anxiously awaiting earnings from Apple Inc. (NASDAQ:AAPL) tonight, and tomorrow should be eventful, too. The Federal Open Market Committee (FOMC) will wrap up its two-day policy meeting, and the House will vote on a two-year budget deal that could avert a government shutdown.

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Among the stocks with notable option activity is Chinese e-tailer Alibaba Group Holding Ltd (NYSE:BABA), which is up 4.2% at $79.55 -- and struggling to overtake former support in the $80 region -- thanks to well-received earnings. Overall options volume is running at four times the average intraday clip, and it looks like some short-term traders are either betting on or hedging against a steep pullback, buying to open the weekly 11/6 71.50-strike put.


One of the NYSE's top performers is Coach Inc (NYSE:COH), which is up 4.6% at $31.71, as traders celebrate stronger-than-expected earnings. Furthermore, J.P. Morgan Securities lifted its price target to $32 from $30. COH is now on pace to end the week atop its 10- and 20-week trendlines for the first time since late April.

Among the leading losers on the Big Board is online restaurant concern GrubHub Inc (NYSE:GRUB), which was last seen 21.1% lower at $25.29, and just off a record low of $22.49. The company confessed to weaker-than-anticipated earnings, and forecast current-quarter revenue below expectations. 

The CBOE Volatility Index (VIX) is up 0.4 point, or 2.6%, at 15.69.

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 0.78, with calls outpacing puts. At last check, SPY was 0.4 point, or 0.2%, lower at $206.58.




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