Options Trading News

May 14, 2013  Tue 7:11 AM CT

Stocks are trying to set another record today after fighting back from losses earlier in the morning.

S&P 500 futures are fractionally higher after falling by more than one-tenth of a percent. Europe is also fighting its way back to positive after posting slightly larger declines. Asian markets were mostly negative overnight, led by a 1.1 percent drop in Shanghai.

The news flow from overseas is mixed today, with the bulls focusing on a strong Spanish bond auction and the bears on a weak German Zew financial-sentiment index. A report also showed industrial production rising in the Eurozone at a 1 percent pace in March, more than twice the 0.4 percent reading forecast by economists.

Investors will get more data from Europe tomorrow when France and Germany release economic-growth numbers. There are no potentially market-moving numbers in the United States today.

Sentiment has been positive most of the year as the labor market strengthens, credit conditions improve, and Europe mends its financial problems. In recent weeks, investors have been seeking value in depressed groups such as emerging markets and solar stocks. The National Bank of Greece, for instance, has gained more than 50 percent in the last week.

Financials have also been quietly gaining momentum and are the strongest major sector in the last month. Mortgage-bond insurers, another once-distressed niche, have led that advance. (See our researchLAB market screener for more.)

Currencies associated with global growth and risk appetite, such as the euro, Australian dollar, and Canadian dollar are weak today. Copper, which follows a similar sentiment, is down more than 2 percent and oil is lower by almost half a percent. Precious metals and are also negative, while agricultural products are mostly higher.

In company-specific news, video-game company Take-Two Interactive Software is up 8 percent in earlier trading after its earnings and revenue beat expectations. One investor who placed a bullish option trade in the name last week is poised to realize extreme profits on the move. Tesla Motors, already up 48 percent in the last week, is indicated higher by another 7 percent before the opening bell.
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