Dow Jones Industrial Average Pares Losses as Oil Goes Green

Analyst Says "Endgame Is Near" for Oil Stock

Dec 8, 2015 at 11:58 AM
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The Dow Jones Industrial Average (DJIA) has pared heavy early losses amid a sudden rebound in oil. After falling below $37 per barrel, crude futures for January delivery have muscled back into positive territory at midday. While the Dow has been underwater all morning, the Nasdaq Composite (COMP) made a brief move into positive territory earlier, thanks to strength from biotechs. Still, with data relatively light heading into the Federal Open Market Committee's (FOMC) meeting next week, oil prices are likely to keep dominating the headlines. 

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

 

  • Why the "endgame is near" for this oil stock trading at all-time lows.  
  • This healthcare stock has exploded over 40% to multi-year highs
  • 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 put activity is restaurant chain Chipotle Mexican Grill, Inc. (NYSE:CMG). The contracts are trading at twice the average rate, with the shares sliding 0.8% to $547.15, after yet another twist in the E. coli saga. It appears bears are taking a short-term approach, with buy-to-open activity likely at the weekly 12/11 530-, 525- and 520-strike puts. In other words, traders are betting on extended losses through week's end. 

Among the biggest losers on the Nasdaq is office supply chain Staples, Inc. (NASDAQ:SPLS), as the shares continue to slide in light of Monday's damning antitrust development. The stock has dropped 6.2% to trade at $9.99, and earlier hit a 13-year low of $9.81, as brokerage firms begin to turn their backs to the security. For instance, Telsey Advisory Group and KeyBanc downgraded SPLS to "market perform" and "sector weight," respectively. 

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One of the better performers on the Big Board is electronics retailer Best Buy Co Inc (NYSE:BBY), with the shares bouncing back from early morning losses to add 1.2% to $31.05. It's somewhat surprising to see this strength from BBY, as the stock has underperformed the S&P 500 Index (SPX) by nearly 25 percentage points during the past three months. 

The CBOE Volatility Index (VIX) is up 1.6 points, or 10.4%. 

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.64, with puts outnumbering calls. The SPY was last seen 0.9 point, or 0.4%, lower at $207.33. 

 

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