MMR

Deal-Making Drives Dow Jones Industrial Average Higher

Why Big VIX Moves are Unreliable Indicators

Nov 2, 2015 at 11:52 AM
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The Dow Jones Industrial Average (DJIA) dipped in the first minutes of trading -- weighed down by Visa Inc (NYSE:V) -- but quickly bounced back with a vengeance. A flood of M&A headlines are helping the major market indexes extend October's upward momentum, with traders encouraged by the strength of the collective corporate pocketbook. Against this backdrop -- and with healthcare leading the charge -- the Dow and its peers are comfortably higher, shrugging off a two-year low in the Institute for Supply Management's (ISM) manufacturing index.

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Among the stocks with notable option activity is Endurance International Group Holdings Inc (NASDAQ:EIGI), which is down 21.1% at $10.55, and just off an all-time low of $10.29. Traders are panning the company's lackluster revenue guidance, as well as its bid for online marketing concern Constant Contact Inc (NASDAQ:CTCT). At last check, EIGI puts are trading at 43 times the average intraday pace, and have outnumbered calls by a margin of nearly 10-to-1.

One of the Nasdaq's top performers is biotech Dyax Corp. (NASDAQ:DYAX), which is up 30.8% at $35.99, and just tagged a near 14-year high of $36.68. Bolstering the stock is a $37.30-per-share buyout bid from Shire PLC (ADR) (NASDAQ:SHPG).

Among the leading losers on the Nasdaq is real estate operator Green Brick Partners Inc (NASDAQ:GRBK), which has plummeted 22% to $8.23, after the David Einhorn-led company cut its 2015 forecast. Furthermore, Credit Suisse trimmed its price target to $10 from $13. The stock is on pace for its worst session in nearly two years, and is poised to settle in single-digit territory for the first time since mid-June. 

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The
CBOE Volatility Index (VIX) is down 0.5 point, or 3.4%, at 14.56.

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.33, with puts having the edge over calls. At last check, SPY was 1.5 points, or 0.7%, higher at $209.40.


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AI has exploded ever since ChatGPT set the world on fire near the end of 2022.

Numerous companies with connections to artificial intelligence have seen their stocks soar.

That includes Nvidia, the poster boy of AI.

Its stock has skyrocketed 716% since ChatGPT’s debut. But here’s the thing …

While everyone’s still counting their money from this first AI boom … Nvidia and countless others have moved on to the next stage.

That includes Big Tech, which is currently making a series of peculiar investments in a few strange companies. This has nothing to do with tech. At least on the surface …

Yet, these strange investments could be the early ripples of a massive wave …Without them, ChatGPT could stop operating … Amazon, Google, Microsoft and more could see profits drop drastically.

In fact, Elon Musk says these investments are critical when it comes to solving the number one problem facing AI.

Now, Silicon Valley legend Michael Robinson has identified two companies that could play a significant role in the solution.

Their stocks just may be the key to AI 2.0.

Find out more about these two companies today.
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