Another week we are glad to see the end of…
Dow was down 25 for the week after a big 120 drop on Monday and a false 175 point rally Tuesday and Wednesday.
http://finance.yahoo.com/q/bc?s=%5EDJI&t=5d
The other indices followed suit and appeared weaker, if anything, than they did last week. Next week will be spent waiting for the Fed and then interpreting the Fed so we need to just hunker down for the long haul.
Oil held $70. gold held $580 and copper held $3.15 all of which are signs that the markets are heading in the wrong direction. How can there be such a robust demand for commodities if the global economy is slowing.
The big deal of the week was APC’s takeover of KMG and WGR for an amount that makes a statement that high commodity prices are hear to stay.
We wisely stayed out of the week so all of the reviewed picks should be taken with a grain of salt as these were, for the most part, short-term trades at best.
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AAPL is working out so far with the Jan $55s up $1.10, we put $2.50 in the bank for selling the $60s which are still $1.20 out of the money at $2.30 but may threaten this week if bargain shoppers come in. Still not bad for a $9.40 investment so far.
ADBE was one of the only trades we stuck with for the long haul and the $30s finished at $1.35 (up 125%).
http://finance.yahoo.com/q/bc?s=ADBE&t=5d
ATYT had an up and down week but we had the $15s for a buyout bid that seems less likely after losing 15% to $1.
BBY was a good example of why we get out fast in this market as a great pick on Monday ended Friday lower than the week began:
http://finance.yahoo.com/q/bc?t=5d&l=on&z=m&q=l&p=&a=&c=&s=bby
CAL held up despite hints of a scandal in the Airline industry but the Aug $25 puts held steady at $1.10. I like the risk/reward on this one as long as they don’t break $29.
INTC continued downward and the October $20s lost 25% to .45 as this stock does not look like anything is going to save it. The first Xeon servers roll out this week so it will be all about the reviews but I’m expecting a recovery (Fed permitting).
JNJ held up well but the Aug $60 puts went up a dime to .60.
LVS Sept $60 puts came in at our target of $2.90 and held up for the week.
MOT continues to break my heart as the $20s fall 25% to .65 as Nokia seems to be moving in on Siemens wireless business which is worrying people who are counting on Motorola picking up Siemens’ Enterprise Unit, a deal that is rumored to be in trouble already. Meanwhile, Microsoft has already jumped the gun and announced a partnership with Mot/Siemens on a Business phone initiative so who knows where this will end up?
MRK didn’t drop as much as we thought but the $35 puts were a good call as they moved up 40% to .65.
MS was indeed expensive but worth it as the $55s jumped up to $5 (up 50%).
UAUA was another airline that showed surprising strength and seemed to ignore the fundamentals of high oil and fears of a slowing economy. The $30 puts finished down a nickel at $1.05.
