Wednesday’s Bullish Trading
Advanced Micro Devices (AMD) saw a sudden surge in activity Wednesday afternoon. With no immediate headlines to explain the action, the stock rallied 41 cents, or 14.5 percent, to $3.23 and multi-month highs on heavy turnover of 67 million shares. Meanwhile, 91,000 calls and 26,000 puts traded on the chipmaker today. May 3 calls, which are now 25 cents in-the-money and expiring in 16 days, are the most active in AMD. 19,435 traded against 13,543 in open interest. May 2.5, May 3.5 and June 3 calls are seeing active trading as well and 30-day implied volatility in options on AMD is up 27 percent to 64.5.
Bullish trading was also seen in Marvell Technology (MRVL), Covanta (CVA), and Newfield Exploration (NFX).
Wednesday’s Bearish Trading
Angie’s List (ANGI) came under fire Wednesday afternoon after Citron Research published a negative note about the Indianapolis, IN consumer services directory company. The stock is down $1.37 to $22.87 on increasing volume of 4.4 million shares. Meanwhile, about 12,000 puts and 2,200 calls traded on the stock so far. May 22.5 puts, which are now 1.6 percent out-of-the-money, are the most active in ANGI. More than 4,000 traded. May 20 and 25 puts are busy as well and 30-day implied volatility in the options on the stock is flat at 58.
Bearish trading was also seen in Mechel Steel (MTL), CBS, and Apollo Group (APOL).
Index Recap
Implied volatility [IV] is moving broadly higher throughout the options market Wednesday. For example, CBOE Volatility Index (.VIX), which tracks the expected or implied volatility priced into the S&P 500 Index (.SPX) options, is up 1.07 to 14.59. The S&P is down 15.11 points to 1,582.46. Meanwhile, implied volatility on NASDAQ 100 Index (.NDX) options, as measured by .VXN, is up .51 to 15.86 and implied volatility on options on the Dow Jones Industrial Index (.DJX), based off the latest readings from .VXD, moved up .90 to 13.11. GVZ tracks the implied volatility of the options on SPDR Gold Fund (GLD) and is up 1.15 to 23.24. OVX tracks IV of US Oil Fund (USO) options and is jumped 1.84 to 14.57.
Analyzing the ETF Market
Some of the Select Sector Funds are seeing increased put activity late-Wednesday. These nine funds collectively hold the same 500 names from the S&P 500 grouped by broad economic sectors. SPDR Utility Fund (XLU) is down 34 cents to $41.09 and a 17,940-contract block of June 40 puts trades on the ETF for 46 cents when the market was 43 to 46 cents. 25,720 contracts traded. SPDR Industrial Fund (XLI) is down 48 cents to $40.97 and 38,800 May 40 puts traded on the ETF, including a 24,650-lot for 23 cents when the market was 21 to 23 cents. Lastly, several blocks of July 18 puts traded on the SPDR Financial Fund (XLF). Volume at that strike is 25,390. XLF is down 21 cents to $18.49. Portfolio managers are possibly buying protective puts on the funds to help hedge exposure to specific sectors of the market.
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