Bank Earnings, Disney Rally Headline Mixed Trading Week

The S&P 500 and Nasdaq are heading toward their third straight weekly wins

by Patrick Martin

Published on Apr 12, 2019 at 1:07 PM
Updated on Apr 12, 2019 at 1:31 PM

This week had a little bit of everything on Wall Street. The S&P 500 nabbed its longest wining streak in 18 months, but then saw that streak snapped amid renewed tariff tensions with the European Union (EU). A dovish Fed gave stocks a mid-week boost, while investors digested the first round of big bank earnings. Elsewhere, oil prices continue to climb, and are on track for their longest weekly winning streak since 2016. Overall, the Dow appears headed for a weekly loss, while the S&P and Nasdaq are on track for their third straight weekly win. 

Disney Nabs Record High, Spooks Netflix

It seemed like every day a different Dow stock was making headlines. First it was Boeing (BA), which found itself the target of options bears after a 737 production cut. Then it was UnitedHealth (UNH), hit with a rare bear note before earnings next week. Then Disney (DIS) stock nabbed a record high later in the week after announcing details for its new streaming service.

This new competition has already put some pressure on streaming giant Netflix (NFLX). Tech icon Apple (AAPL) fell short of its longest win streak in nine years and was promptly dinged with a downgrade, although options traders remain undeterred. Meanwhile, analysts continue to glow about Facebook's (FB) monetization of Instagram.

All Kinds of Signals Flashing for Bank, Retail Stocks

Banking giants stepped into the earnings confessional later in the week. However, two stocks, PNC Financial (PNC) and Citigroup (C), both flashed bearish signals ahead of their respective events. The retail sector featured some interesting storylines as well. Under Armor (UAA) flashed a pretty reliable "buy" signal, as did Abercrombie & Fitch (ANF). And despite a nasty post-earnings slide, options traders appear to have found a floor for Bed Bath & Beyond (BBBY). 

Several Stocks Hit With Frenzied Options Activity 

Several stocks saw some interesting options activity this week. Competition concerns for Roku (ROKU) sparked heightened put activity, despite the streaming name pulling back to a bullish trendline. A double-downgrade to U.S. Steel (X) had one options trader positioning for more downside. But an even more interesting trade we found was a enormous $11 million transaction on a GrubHub (GRUB) pullback.

Levi's (LEVI) big earnings beat had options bulls flocking to the newly public company, and there appears to be some hedging activity going on with Weight Watchers (WTW) as the Oprah stock touches multi-year lows. Lastly, Canopy Growth (CGC) saw an increase in options bears after the pot stock took a breather.

More Dow Earnings Next Week

Next week, some Dow heavyweights will take their turn in the earnings confessional, including another big bank in Goldman Sachs (GS). Ahead of what's been a strong start to the month, we outlined this VIX level to keep an eye on, while these two stocks could be due for pullbacks.

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