MorningUpdate - Options Trading Email
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MORNING UPDATE: PriceWatch Alerts for AXP, TWX, HAL, and More...
June 13, 8:30 AM ET - Before the open... PriceWatch Alerts for AXP,
TWX, CMCSA, MPC, QCOR, HAL, AMX, VLO, GRMN, GIL, Market Overview,
News Leaders and Laggards, Today's Economic Calendar, and Index
Support & Resistance Levels.
PriceWatch Alerts for AXP, TWX, CMCSA, MPC, QCOR, HAL, AMX, VLO,
GRMN, GIL
American Express (NYSE: AXP) has been identified by
InvestorsObserver analysts as being well-positioned for a new
covered call today. Buying the stock for $56.48 while selling the
October $55.00 call will produce a new covered call with a break-
even point around $51.98. At that price, this position has a target
return of 5.8%. This trade will have roughly 8.0% downside
protection, while still aiming for a 5.8% return in 129 days. It
will lock in that return as long as American Express is above
$55.00 on 10/20/2012. For comparison purposes only, this AXP
covered call aims for an annualized return rate of 14.6%.
Comcast (NASDAQ: CMCSA) has been selected by InvestorsObserver
analysts as a stock that is an ideal candidate for a new covered
call today. Buying the stock for $30.45 while simultaneously
selling the October $30.00 call will result in a new position with
a target return of 5.3%. Based on recent prices, this position will
cost about $28.50, which is also the trade's breakeven point. At
that level, this covered call has 6.4% downside protection, while
still providing a 5.3% return in 129 days as long as CMCSA is above
$30.00 on 10/20/2012. For comparison purposes only, this Comcast
covered call aims for an annualized return rate of 14.6%.
Marathon Petroleum (NYSE: MPC) has been chosen by InvestorsObserver
analysts as a candidate for a new covered call today. Selling the
October $37.50 call while at the same time buying MPC stock for
$39.07 will produce a new covered call with a target return of
7.2%. Based on recent data, this trade will cost about $34.97,
which is also the covered call's breakeven point. At that price,
this covered call has 10.5% downside protection, while seeking an
assigned return of 7.2% return in 129 days. If MPC is higher than
$37.50 on 10/20/2012, we are assured that simple return. For
comparison purposes only, that equates to an annualized return rate
of 18.3%.
Questcor Pharmaceuticals (NASDAQ: QCOR) has been selected by
InvestorsObserver analysts as a stock that is a strong candidate
for a new covered call today. Selling the July $48.00 call while
simultaneously buying QCOR stock for $48.56 will result in a new
position with a break-even point around $45.76. At that price, this
position has a target return of 4.9%. This trade has 5.8% downside
protection, while still providing a 4.9% return in 38 days as long
as QCOR is above $48.00 on 7/21/2012. For comparison purposes only,
this covered call targets an annualized return rate of 43.8%.
Time Warner (NYSE: TWX) has been selected by InvestorsObserver
analysts as a stock that is an ideal candidate for a new covered
call today. Buying the stock for $35.33 while simultaneously
selling the October $35.00 call will result in a new position with
a target return of 5.5%. Based on recent prices, this position will
cost about $33.16, which is also the trade's breakeven point. At
that level, this covered call has 6.1% downside protection, while
still providing a 5.5% return in 129 days as long as TWX is above
$35.00 on 10/20/2012. For comparison purposes only, this Time
Warner covered call aims for an annualized return rate of 14.6%.
America Movil SAB de CV (NYSE: AMX) has been selected by
InvestorsObserver analysts as a stock that is an ideal candidate
for a new covered call today. Buying the stock for $24.23 while
simultaneously selling the August $24.00 call will result in a new
position with a target return of 4.4%. Based on recent prices, this
position will cost about $22.98, which is also the trade's
breakeven point. At that level, this covered call has 5.2% downside
protection, while still providing a 4.4% return in 66 days as long
as AMX is above $24.00 on 8/18/2012. For comparison purposes only,
this America Movil SAB de CV covered call aims for an annualized
return rate of 21.9%.
Gildan Activewear (NYSE: GIL) has been selected by
InvestorsObserver analysts as a stock that is a strong candidate
for a new covered call today. Selling the September $25.00 call
while simultaneously buying GIL stock for $27.15 will result in a
new position with a break-even point around $23.95. At that price,
this position has a target return of 4.4%. This trade has 11.8%
downside protection, while still providing a 4.4% return in 101
days as long as GIL is above $25.00 on 9/22/2012. For comparison
purposes only, this Gildan Activewear covered call targets an
annualized return rate of 14.6%.
Garmin (NASDAQ: GRMN) has been chosen by InvestorsObserver analysts
as a candidate for a new covered call today. Selling the October
$39.00 call while at the same time buying GRMN stock for $39.51
will produce a new covered call with a target return of 6.2%. Based
on recent data, this trade will cost about $36.74, which is also
the covered call's breakeven point. At that price, this covered
call has 7.0% downside protection, while seeking an assigned return
of 6.2% return in 129 days. If GRMN is higher than $39.00 on
10/20/2012, we are assured that simple return. For comparison
purposes only, that equates to an annualized return rate of 14.6%.
Halliburton (NYSE: HAL) has been identified by InvestorsObserver
analysts as being well-positioned for a new covered call today.
Buying the stock for $28.13 while selling the July $28.00 call will
produce a new covered call with a break-even point around $26.64.
At that price, this position has a target return of 5.1%. This
trade will have roughly 5.3% downside protection, while still
aiming for a 5.1% return in 38 days. It will lock in that return as
long as Halliburton is above $28.00 on 7/21/2012. For comparison
purposes only, this HAL covered call aims for an annualized return
rate of 47.5%.
Valero Energy (NYSE: VLO) has been selected by InvestorsObserver
analysts as a stock that is an ideal candidate for a new covered
call today. Buying the stock for $22.28 while simultaneously
selling the July $22.00 call will result in a new position with a
target return of 5.0%. Based on recent prices, this position will
cost about $20.95, which is also the trade's breakeven point. At
that level, this covered call has 6.0% downside protection, while
still providing a 5.0% return in 38 days as long as VLO is above
$22.00 on 7/21/2012. For comparison purposes only, this Valero
Energy covered call aims for an annualized return rate of 47.5%.
*Annualized returns are shown for comparison purposes only
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NEWS LEADERS AND LAGGARDS
Stocks pointed higher ahead of the open this morning include Cabot
Oil & Gas (COG), Republic Services Inc. (RSG) and Dell (DELL).
Pointed lower this morning are Nucor Corp. (NUE), CMS Energy (CMS)
and Expedia (EXPE). Analyst upgrades this morning include Venoco
(VQ), Tesco (TSCDY) and Zynga (ZNGA). Analyst downgrades this
morning include William Morrison Supermarkets (MRWSY), Ryanair
Holdings (RYAAY) and Telenav Inc. (TNAV).
MARKET OVERVIEW
Asian markets ended modestly higher today, but ongoing uncertainty
ahead of this weekend's Greek elections contributed to a choppy
session. A record high in Spanish bond yields kept exporters under
pressure, and Esprit Holdings tanked in Hong Kong after its CEO
stepped down. However, an encouraging report on Japanese machinery
orders helped give bulls an edge. By the close, South Korea's Kospi
edged up 0.3%, Japan's Nikkei added 0.6%, Hong Kong's Hang Seng
gained 0.8%, and China's Shanghai Composite rose 1.3%. On the other
hand, the major European indexes are lingering just below breakeven
at midday. The yields on Spain's 10-year notes have cooled slightly
from Tuesday's euro-era peak, but are still lingering uncomfortably
close to 7%. Disappointing data is also weighing on investor
sentiment, as industrial production in the euro zone contracted by
0.8% in April. At last check, London's FTSE 100 is off 0.02%, the
French CAC 40 has shed 0.1%, and the German DAX is down 0.4%.
PUT/CALL RATIO
Equity option activity on the Chicago Board Options Exchange (CBOE)
saw 881,348 call contracts traded on Tuesday, compared to 633,895
put contracts. The resultant single-session put/call ratio arrived
at 0.72, while the 21-day moving average was 0.75.
SUPPORT & RESISTANCE LEVELS
The S&P Depository Receipts (SPY) show support in the neighborhood
of $131.15 with resistance near $133.50. The Nasdaq 100 (QQQ) has
shown support around $61.65 and resistance around $63.35.
TODAY'S ECONOMIC CALENDAR
8:30 a.m. May Retail Sales
8:30 a.m. May PPI
10:00 a.m. Apr Business Inventories
10:30 a.m. 6/9 Crude Inventories
EARNINGS EXPECTED TODAY
KFY
LUB
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