Dow Jones Industrial Average Up Triple Digits; Energy, Bank Stocks Soar

A Golden Opportunity for Contrarian Option Bulls

Oct 5, 2016 at 12:09 PM
facebook twitter linkedin

The Dow Jones Industrial Average (DJIA) is up triple digits, as stocks react to rising oil prices. Crude futures for November were last spotted 2.2% higher at $49.78 per barrel -- nearing a three-month high and the round $50 mark -- after the Energy Information Administration (EIA) reported a fifth consecutive weekly drop in U.S. stockpiles. Also contributing to gains is the Institute for Supply Management's (ISM) stronger-than-expected non-manufacturing index for September, which offset weaker-than-anticipated jobs data. Additionally, bank stocks are rallying, as interest-rate chatter swirls. After taking a hawkish stance earlier this week, Richmond Fed President Jeffrey Lacker will head back to the podium this afternoon.

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

Midday Market Stats October 5

Among the stocks with unusual options volume at midday is chipmaker Micron Technology, Inc. (NASDAQ:MU). Earnings and upbeat analyst attention have the shares up 1.5% at $18.08. MU calls, meanwhile, are flying across the tape at eight times the usual intraday pace. In fact, with more than 152,000 calls traded already, call volume is on track to tap a new annual high before the day is out. Dominating today's action are the October and December 20 calls, where it appears one trader rolled her long front-month options out.

Oil-and-gas stock Resolute Energy Corp (NYSE:REN) is one of top performers on the New York Stock Exchange so far today. The shares have added 15.5% to $29.66 -- and earlier hit a fresh two-year high of $30.70 -- after a property acquisition sparked a round of bullish brokerage notes. REN has been charging up charts, adding roughly 900% over the past three months.

REN Daily Chart Oct 5

Among the worst performers on the Big Board, meanwhile, is tech stock Gigamon Inc (NYSE:GIMO). The shares have shed 5.4% to $52.16 following two analyst downgrades, but still sit on a hefty 96% year-to-date lead after tapping an all-time high of $56.38 just last week.

The CBOE Volatility Index (VIX) has given back 0.7 point, or 5.3%, at 12.91. 

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.60, with puts comfortable outnumbering calls. SPY was last seen up 1.1 points, or 0.5%, at $215.74.

Find out where the Dow lands right after the closing bell. Sign up now for Schaeffer's Market Recap


Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

Schaeffer's Daily Bulletin Offer


Special Offers from Schaeffer's Trading Partners