Dow Jones Industrial Average Eyes a Third Straight Win

Are Cheap Options Really a Better Deal?

by Alex Eppstein

Published on Jun 22, 2016 at 9:01 AM

After two straight days of gains, the Dow Jones Industrial Average (DJIA) is set for a soft start, with futures just a shade above fair value in pre-market trading. It appears jitters related to tomorrow's "Brexit" vote are beginning to crop up again, after Fed Chair Janet Yellen yesterday warned a Senate panel that a U.K exit from the European Union (EU) could have "significant repercussions." Yellen will be on Capitol Hill again today, for the second leg of her congressional testimony. Stocks could also move this morning, when the International Monetary Fund (IMF) conducts a press conference to address the state of the U.S. economy.

Continue reading for more on today's market, including: ​

dow futures june 22

Futures on the Dow Jones Industrial Average (DJIA) are roughly 20 points above fair value.

5 Things You Need to Know Today
 

  1. While stock trading in Asia was quiet, European markets are shrugging off "Brexit" worries en route to strong gains.
  2. The Chicago Board Options Exchange (CBOE) saw 628,619 call contracts traded on Tuesday, compared to 403,696 put contracts. The resultant single-session equity put/call ratio rose to 0.64, while the 21-day moving average edged down to 0.64.
  3. Tesla Motors Inc (NASDAQ:TSLA) offered to buy SolarCity Corp (NASDAQ:SCTY) in an all-stock deal worth up to $2.8 billion, with Elon Musk -- TSLA's CEO and SCTY's chairman -- describing the acquisition as a "no brainer." Ahead of the bell, TSLA is down 11.5%, while SCTY is up almost 15%.
  4. Unfortunately for call buyers, shares of Adobe Systems Incorporated (NASDAQ:ADBE) have plunged 3.8% in electronic trading, after the software firm offered up a disappointing current-quarter forecast. However, ADBE's fiscal second-quarter earnings were better than expected, prompting price-target hikes at Citigroup, Goldman Sachs, and Bernstein.
  5. McDonald's Corporation (NASDAQ:MCD) has reportedly received more than six bids from private equity firms looking to acquire the restaurant chain's China and Hong Kong stores. Nomura isn't impressed, cutting its rating to "neutral" from "buy," and slashing its price target to $129 from $142, in response -- business as usual from a generally skeptical brokerage crowd.

Buzz Stocks June 22

Earnings and Economic Data

Existing home sales and the regularly scheduled crude inventories update will hit the Street today. Additionally, Yellen will continue her stay on Capitol Hill, testifying in front of the House Financial Services Committee. Actuant (ATU), Barnes & Noble (BKS), Bed Bath & Beyond (BBBY), and Red Hat (RHT) will tell all in the earnings confessional. To see what else is coming up on this week's schedule, click here

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