Peabody Energy Corp (NYSE:BTU) stock is up 1.4% at $26.67 at last glance, on track for its fourth-straight day of gains. The equity has found a floor just above the $25 level, too, which is home to its 200-day moving average -- a trendline with historically bullish implications. 

The stock has come within one standard of that trendline five times in the past three years, according to Schaeffer's Senior Quantitative Analyst Rocky White, after which BTU was positive one month later every time, averaging a 15.5% gain. A similar move would push BTU back above $30. 

A bout of short covering could provide tailwinds for Peabody Energy stock as well. Short interest accounts for 12.6% of the equity's available float, or 4.5 days' worth of pent-up buying power. 

Now could be a good time to weigh in on the security's next move with options. BTU is seeing attractively priced premiums at the moment, per its Schaeffer's Volatility Index (SVI) of 55%, which sits in the low 5th percentile of its annual range. 

Stock futures are on the rise this morning, as investors try to leave last week's dismal losses in the rearview mirror. Durable goods orders fell 4.5% for January compared to the 3.6% drop Wall Street expected, indicating consumers are holding back on big purchases. Futures on the Dow Jones Industrial Average (DJIA) are eyeing a 238-point pop, and Nasdaq-100 Index (NDX) and S&P 500 Index (SPX) futures are also sharply higher.

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

• Keep tabs on this electricity and oil stock.
• Recapping a data-filled President's Day week.  
• Plus, Best Buy stock downgraded; buyout rumors boost biotech stock; and Union Pacific to name CEO successor.

5 Things You Need to Know Today

1. The Cboe Options Exchange (CBOE) saw more than 1.2 million call contracts and 943,597 put contracts traded on Friday. The single-session equity put/call ratio stayed at 0.80 and the 21-day moving average stayed at 0.79.
2. Telsey Advisory Group downgraded Best Buy Co Inc (NYSE:BBY) to "market perform" from "outperform," citing the impact high inflation and rate hikes could have on the tech retailers' sales and profits. BBY is off 1.7% ahead of the open, and 8.5% year-over-year.
3. Acquisition rumors are boosting Seagen Inc (NASDAQ:SGEN) stock, which was last seen up 13.4% in premarket trading as Pfizer (PFE) reportedly eyes the drug maker that is valued at roughly $30 billion. So far in 2023, the equity has already added more than 25%.
4. Union Pacific Corporation (NYSE: UNP) said it will name a successor for CEO Lance Fritz in 2023. The shares are up 9.4% before the bell, enjoying an upgrade from Bank of America to "buy" from "neutral." Over the past 12 months, UNP has shed 19.9%.
5. Today also brings pending home sales data. 

    

Insurance Sector Boosts European Markets

Markets in Asia slipped on Monday, following the U.S. market’s sharp decline last week. Meanwhile, the People’s Bank of China remained dovish in its quarterly report. Japan’s Nikkei fell 0.1% for the day, the South Korean Kospi shed 0.9%, while China’s Shanghai Composite and Hong Kong’s Hang Seng both dropped 0.3%.

European markets are sporting considerable gains, fresh off a disappointing week for the bourses, with help from the insurance sector. London’s FTSE 100 is up 0.7% at last look, while the French CAC 40 rises 1.6%, and the German DAX jumps 1.5%.

It was a pretty rough President's Day week on Wall Street, as investors mused over the Federal Reserve's stance regarding rate hikes and unpacked a host of economic data. Stocks fell to start the week, with the Dow Jones Industrial Average (DJI) dropping nearly 700 points. The major indexes extended their slide on midweek following the latest Fed minutes, before the S&P 500 Index (SPX) found some relief and snapped a four-day losing streak. However, Friday's red-hot inflation data rattled the market once again, and all three major benchmarks are on track for weekly losses.  

Earnings Reports This Week

Blue-chip retailer Walmart Inc (WMT) announced an upbeat fourth-quarter report this week. Several stocks made big moves after results came in, including Nvidia Corporation (NVDA), which gave the chip sector a boost after its surge, and Palo Alto Networks Inc (PANW). Meanwhile, options traders targeted Moderna Inc (MRNA) after its disappointing report and FDA update, and Warner Bros Discovery Inc (WBD) and Booking Holdings Inc (BKNG) announced earnings on Friday. 

What's On Tap as March Begins

Earnings season will continue next week, with reports from several retail names. There will be a good amount of economic data too, particularly on Tuesday. Meanwhile, newsletters have been becoming more bullish, which could signal a short-term pullback, and VIX call buying has been at elevated levels as well. 

Stocks fell sharply today, with the Dow logging its fourth-straight weekly loss after January's inflation report showed a hotter-than-expected increase in prices. The S&P 500 marked its third-straight weekly loss and worst weekly percentage drop since Dec. 9, while the Nasdaq finished in the red for the week as well, as investors continue to mull over how the Federal Reserve will react to inflation data going forward. 

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

• A look at our biggest President's Day week prediction.
• Warner Bros stock shook off lackluster fourth-quarter results.
• Plus, BKNG's new all-time high; DOJ challenges Adobe; and an REIT for options bears.

5 Things to Know Today 

1. The Supreme Court is hearing two cases against U.S. President Joe Biden's student loan forgiveness policy. (CNBC)
2. For another week, Ford (F) is extending its electric pickup truck production pause. (MarketWatch) 
3. Booking stock hit a new record for monthly room bookings.
4. Looming Justice Department challenge dings Adobe stock.
5. Why options bears love this REIT.

Gold Logs Fourth-Straight Weekly Loss

April-dated crude futures rose 93 cents, or 1.2%, to close at $76.32 per barrel, eking out a marginal 0.3% weekly win. Support rolled in as investors weighed Russia's supply and China's demand. 

Gold prices fell for a fourth-straight week. For the session, April-dated gold futures shed $9.70, or 0.5%, to settle at $1,817.10, moving 1.8% lower for the week. January's PCE report gave investors pause, as futures rate hikes and monetary policy could impact gold.

Subscribers to Chart of the Week received this commentary on Sunday, February 19.

Historically, President’s Day week garners a poor performance out of the S&P 500 Index (SPX), per data from Schaeffer’s Senior Quantitative Analyst Rocky White. In fact, short trading weeks in general (when one or more Federal holiday closes the market) for weeks in which Monday is the day off, like next week, the index does not outperform five-day weeks. On the flip side, when Friday is the holiday, the SPX pulls a weekly gain that is six times the average of a week with Monday off. 

White also gathered a list of the top 20 outperformers during President’s Day week over the past 10 years. Electricity stocks make up five of the 20 names, including the top three positions. Several other sectors showing up repeatedly include software and electronic equipment. Earlier in the week Schaeffer’s Digital Media Content Manager Laura McCandless covered Pinnacle West Capital (PNW), which holds the top position.

Today I’d like to dig into #2 on the list, Xcel Energy Inc (NASDAQ:XEL), an electric and natural gas delivery giant. Per White, XEL averaged a return of 1.6% President’s Day week over the last 10 years, finishing positive 100% of the time. From the stock’s Thursday close of $67.26, the shares could be looking at a settlement just shy of $69 this time next week.

Xcel Energy stock has seen a volatile six months on the charts, including both a golden cross and a death cross (circled below in red). The bull run following the stock’s golden crossover of the 20-day and 50-day moving averages in mid-November was relatively short-lived, but led the shares just shy of a four-month peak. Subsequently, late last month, the equity saw a death cross of the same two moving averages, which could indicate that next week’s historically bullish outperformance may also be short-lived (if it happens at all).

XEL options traders have been call-heavy in both the long and short term. Albeit amid light absolute volume, Xcel Energy stock sports an Schaeffer's put/call open interest ratio (SOIR) reading of 0.56, which sits in the low 18th annual percentile. Echoing this, at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity's 10-day call/put volume ratio of 5.20 sits higher than 85% of annual readings, indicating calls have been more popular than usual.

Regardless of the risk you’d be willing to take during the upcoming holiday-shortened week, options are looking extremely affordable. Specifically, XEL’s Schaeffer's Volatility Index (SVI) of 21% ranks in the 18th percentile of the last 12 months.

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