Does Bearish Put Action Signal Something’s Not Quite Right?
The stock market has been trading mixed
ahead of the pending ruling by the US Supreme Court. The DJIA continues to
outperform the Nasdaq, but that’s due in part to the 7 ¾ point sell off in Dallas
Semiconductor
(
DS |
Quote |
Chart |
News |
PowerRating).
The DS dip acted as a pull on an otherwise bullish session. In the last few
minutes we’re seeing some bullish option money flows into the following names:
WalMart
(
WMT |
Quote |
Chart |
News |
PowerRating), Broadcom
(
BRCM |
Quote |
Chart |
News |
PowerRating) and Lucent Technologies
(
LU |
Quote |
Chart |
News |
PowerRating), but most of you already know there are rumors of a takeover pushing
LU higher.
The first chart from our site, www.1010WallStreet.com,
shows some of the negative dollar weighted put action in some pretty
high-profile names. Some of the action can be explained by market makers doing
10-point spreads to capture short stock interest, but others are more telling.
For instance, there are some pretty bearish accumulations of puts going on in
General Electric
(
GE |
Quote |
Chart |
News |
PowerRating) and Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating). The buyers of those puts are
not simply buying cheap ¼ or ½ dollar puts, but instead the $5 and higher
variety. To us, this signals an institutional client either betting on more bad
news, or simply buying protection for their portfolio. Either way, it’s not a
bullish sign for those equities.
|
Symbol
|
Call
|
Put
|
W
|
W
|
|
CMGI
|
3,407
|
8,529
|
7,793
|
690,986
|
|
YHOO
|
28,448
|
39,581
|
133,618
|
4,984,797
|
|
MU
|
2,845
|
4,570
|
6,650
|
144,641
|
|
AMZN
|
3,780
|
6,944
|
12,030
|
212,793
|
|
AAPL
|
1,981
|
5,039
|
3,455
|
33,907
|
|
MNX
|
4,306
|
17,655
|
37,313
|
196,377
|
|
GPS
|
276
|
4,105
|
503
|
2,387
|
|
DELL
|
14,343
|
7,257
|
26,684
|
116,272
|
|
MSFT
|
18,194
|
16,619
|
66,650
|
266,745
|
|
GE
|
8,683
|
9,629
|
19,137
|
60,737
|
|
SDLI
|
1,555
|
1,659
|
16,032
|
50,052
|
|
EBAY
|
1,290
|
948
|
3,537
|
10,625
|
|
PFE
|
1,498
|
2,976
|
3,861
|
9,342
|
|
LSI
|
1,702
|
4,455
|
5,863
|
13,716
|
|
VERT
|
432
|
215
|
821
|
1,911
|
Lastly, this chart shows our tracking of
the top index volatilities. You might note the Nasdaq volatilities are creeping
up from mid-60’s yesterday to nearly 70 today.
|
|
Volatility
|
CBOE
|
|
Symbol
|
Description
|
Index
|
|
BHH
|
B2B HOLDRs
|
113.91
|
|
HHH
|
Internet HOLDRs
|
96.26
|
|
SOX
|
Semiconductor Index
|
87.92
|
|
SMH
|
Semiconductor HOLDRs
|
86.22
|
|
BBH
|
Biotech HOLDRs
|
77.52
|
|
BDH
|
Broadband HOLDRs
|
74.92
|
|
QQQ
|
NASDAQ-100 Tracking Stock
|
69.89
|
|
MNX
|
Mini NASDAQ-100 Index
|
69.59
|
|
NDX
|
NASDAQ-100 Index
|
68.06
|
|
OSX
|
Oil Service Index
|
63.62
|
|
BKX
|
Banking Index
|
38.89
|
|
RUT
|
Russell 2000 Index
|
37.86
|
|
OEX
|
Standard & Poor’s 100
|
27.87
|
|
SPX
|
Standard & Poor’s 500
|
25.96
|
|
DJX
|
Dow Jones Industrial Index
|
23.23 |
Until
tomorrow!