Asia is mixed and Europe is slightly up but mainly on big gains in energy and commodity stocks, which is no guarantee of a broader rally. Within mixed though, is the oil poor Nikkei dropping 1.3% to 17,000 only saved by the bell!
http://finance.yahoo.com/q/bc?t=1d&l=on&z=m&q=l&p=&a=&c=&s=%5En225
Of course Japan is at the beginning of its own Fed tightening cycle and is coming off a 70% run so I’m not going to read too much into it unless it heads below 16,000 (which it might do tomorrow if US equities crash). This is why Japan has taken a sudden interest in the Iran situation.
The Indian markets continue to shrug off all adversity and gained 2.7% while nice noises with their neighborhood rivals raised Pakistan’s markets 1.1%. Check out INFY today as they posted amazing numbers on Friday. By the way, what do Indian and Pakistani people buy when they make a few rupees in the markets? Gold!
Oil looks well on its way to breaking $70 today and gold is picking up steam across the Atlantic, now brushing right up against my $605 target.
So I’m happy with my XOM $62.50s and my ABX $30s at the moment but I hate having any April position this close to expiration (other than, of course, quick trades).
Aside from the usual nonsense that keeps oil up we now have numbers out of China that indicate a 10% growth rate is continuing despite their government’s sincere efforts to slow it down.
There is no way I want leave money on the table this week. It is amazing that the dollar isn’t collapsing, which would drive commodities throught the roof and cause the dollar to collapse more… There will be plenty of nice plays but my sell finger will have the itchy set to maximum until we get through these earnings at least!
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C did indeed post very nice numbers so we will see where the $47.50s end up but remember that you are unlikely to get much more than you will in a morning spike so I will be looking to cash in sooner, rather than later on this one with expiration looming.
WB also had great earnings, especially when you take into account the merger and a one-time $98M charge as it changed accounting methods. If C really takes off the $55s might be a good quick momentum play at $1.30.
We may have missed our chance to go long on TIVO but one company’s $74M gain is DISH‘s $74M loss! Should have thought of this earlier as the damages still may triple and then there’s ongoing royalty issues that will need to be addressed. So, given a week and the low price I like the $30 puts for .35 as the bad news seeps out.
This is my favorite time to be able to buy PD as the premiums ease off but the $87.50s for $1 still carry substantial risk and need to be sold if copper crosses back below $285 but this stock should certainly be at $90 right now but there is little chance it will go over $87.50 before expiration so we are in and out of this quickly!
MOT has earnings out tomorrow and good ones should finally get them over the $25 mark so I like the May $25s for .40 but not a penny more as this could be a total wipeout if they don’t beat. Although cheap, the shear volume of phones being sold to emerging markets should add gravy to the bottom line.
I bought ALKS at the bell on Friday as the news of the FDA approval crossed the wire with less than 10 minutes to go. I took the $22.50s for .50 which I felt good about but I’m not sure I would recommend chasing them. The May $22.50s were at $1.40 and the stock is well off its high of $26.81 and there were 10% shorts on it as of last week so this could be a wild one! The stock may not fly right away as it’s a black box approval but so are all the competing treatments as they are bad for people who have liver damage.
Shrinking ad spending has really hurt all the news stocks but web revenues were the strength of the NYT’s report and that may bode well for YHOO tomorrow.
BTU is heading into tomorrow’s earnings with low expectations (.44) and now that natural gas prices are on the rise again it will make a good day trade but I wouldn’t want to touch these over-priced options in advance.
UNH reports tomorrow and the May $55s look pretty beat up at $1.50 so I like the risk/reward there as the stock is already 10% below the Q4 drop (“only” 18% growth) and I think they will get one more chance to justify the 20% premium p/e they carry. Here’s an interesting article talking about how awful it is that UNH dominates the industry!
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BD2334AAB%2D0321%2D432E%2DB5AE%2D695FDBCF258B%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo
TXN reports tomorrow as well as IBM so I think we’ll have a pretty good idea by the end of the day where the week will be going! Let’s not forget that the best play on good TXN earnings are the GLW May $25s for $2.67.
HAL is selling just 20% of KBR as an IPO for a ridiculous amount of money so they should perform well this week. In a related note, I will be selling off 20% of my home and my car next week in an IPO for about what the whole home is worth. You won’t really own it and your vote won’t mean anything in the way it runs and we won’t be paying any dividends but you’ll get some pretty certificates saying that you own .000000001% of a very nice house!
KKR is using some of it’s home improvement money to buy a development division of FLEX for $900M. This is 3x more than FLEX earned last year and FLEX retains 15% of the company so I’m liking Jan $12.50s for .60 as it will give them time to explain what they are doing to analysts.
BDK has earnings on the 27th and I like the May $90s for .85 as SWK has already made a huge comeback:
http://finance.yahoo.com/q/bc?t=1y&s=BDK&l=on&z=m&q=l&c=swk
