1:20pm (EST)
The market is trending lower once again despite the ”surprise” unemployment rate numbers from the Labor Department this morning. The Dow is well below the 10,000 level and appears headed for its fourth-straight weekly loss.
The bulls got excited when they heard the unemployment rate unexpectedly fell in January to 9.7% from 10%, as Wall Street had pegged a number of 10.1%. That was the good news. The bad news was employers cut 20,000 jobs, more than the 5,000 expected.
As a result, the Dow is down 74 points, or -0.7%, and is currently at 9,928. The S&P 500 is off by 8 to 1,055 while the Nasdaq is getting clipped for a 6 points and stands at 2,120.
Just when we said we needed to see more M&A activity…Air Products and Chemicals (APD, $68.14, down $5.55) has made a $5 billion bid for Airgas (ARG, $60.27, up $16.74) and is willing to go “hostile”, if need be. Shares of Airgas are up 38% but the February 50 calls (ARGBJ, $10.20, up $10.15) (ARG100220C00050000) are up 20,000%. Ah yeah…we wish we would have gotten you in that trade yesterday.
The stock is trading above the offered price of $60 a share which could signal that a higher bid may be needed to get the deal done. A merger would create one of the biggest industrial gas companies in the world and this is the third time Air Products has made an offer as the other two were shot down.
Air Products already knows it may have to dig deeper in its coffers.
If you will notice, we included two different option symbols to reflect the upcoming changes that are going to be taking place in the option pits. With 20+ inches of snow coming our way, we will have no excuse for not getting this information out to you this weekend.
We are old school and we hate to see the change but it should make option trading easier and you really don’t need to worry about all those confusing numbers. We are going to break it down for you on how they work but don’t sweat it.
As we look forward to earnings next week, Hasbro (HAS, $30.73, down $0.53) could be in-play before the market opens on Monday. Wall Street is looking for the company to report a profit of $0.82 cents a share on revenue of $1.3 billion. As far as the options, it looks like put volume is outpacing the call options but traders could be selling the puts as well.
Our checks indicate that the company had a great quarter and they could surprise Wall Street by a few cents. That might not mean anything given the current market environment as the stock could sell-off despite an earnings beat.
We have updated our current trades before we head out and make sure to look for a complete portfolio update over the weekend as well as the options symbol review in the Members Area. When we post them, we will be sure to send out an email.
Tags: APD, ARG, HAS, Hasbro, option picks, option signals, options alerts, stock options trading
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on Friday, February 5th, 2010 at 1:23 PM and is filed under Company Commentary, Market Analysis, Mergers and Acquisitions, Sectors, Trading Psychology.
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Dow Slips Below 10,000
1:20pm (EST)
The market is trending lower once again despite the ”surprise” unemployment rate numbers from the Labor Department this morning. The Dow is well below the 10,000 level and appears headed for its fourth-straight weekly loss.
The bulls got excited when they heard the unemployment rate unexpectedly fell in January to 9.7% from 10%, as Wall Street had pegged a number of 10.1%. That was the good news. The bad news was employers cut 20,000 jobs, more than the 5,000 expected.
As a result, the Dow is down 74 points, or -0.7%, and is currently at 9,928. The S&P 500 is off by 8 to 1,055 while the Nasdaq is getting clipped for a 6 points and stands at 2,120.
Just when we said we needed to see more M&A activity…Air Products and Chemicals (APD, $68.14, down $5.55) has made a $5 billion bid for Airgas (ARG, $60.27, up $16.74) and is willing to go “hostile”, if need be. Shares of Airgas are up 38% but the February 50 calls (ARGBJ, $10.20, up $10.15) (ARG100220C00050000) are up 20,000%. Ah yeah…we wish we would have gotten you in that trade yesterday.
The stock is trading above the offered price of $60 a share which could signal that a higher bid may be needed to get the deal done. A merger would create one of the biggest industrial gas companies in the world and this is the third time Air Products has made an offer as the other two were shot down.
Air Products already knows it may have to dig deeper in its coffers.
If you will notice, we included two different option symbols to reflect the upcoming changes that are going to be taking place in the option pits. With 20+ inches of snow coming our way, we will have no excuse for not getting this information out to you this weekend.
We are old school and we hate to see the change but it should make option trading easier and you really don’t need to worry about all those confusing numbers. We are going to break it down for you on how they work but don’t sweat it.
As we look forward to earnings next week, Hasbro (HAS, $30.73, down $0.53) could be in-play before the market opens on Monday. Wall Street is looking for the company to report a profit of $0.82 cents a share on revenue of $1.3 billion. As far as the options, it looks like put volume is outpacing the call options but traders could be selling the puts as well.
Our checks indicate that the company had a great quarter and they could surprise Wall Street by a few cents. That might not mean anything given the current market environment as the stock could sell-off despite an earnings beat.
We have updated our current trades before we head out and make sure to look for a complete portfolio update over the weekend as well as the options symbol review in the Members Area. When we post them, we will be sure to send out an email.
Tags: APD, ARG, HAS, Hasbro, option picks, option signals, options alerts, stock options trading
This entry was posted on Friday, February 5th, 2010 at 1:23 PM and is filed under Company Commentary, Market Analysis, Mergers and Acquisitions, Sectors, Trading Psychology. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.