Options Trading News

October 11, 2013  Fri 7:12 AM CT

Stocks are pausing after their biggest rally in more than two years yesterday.

S&P 500 futures are little-changed this morning, while European markets are mixed. Most Asian indexes climbed 1 percent to 2 percent in the overnight session.

The S&P 500 climbed 2.18 percent yesterday, its strongest advance since August 2011, after House Republicans agreed to temporarily raise the country's debt limit in return for a meeting with President Obama. That conference produced no specific results, but talks are continuing.

Investors have been worried that Congress and the White House will fail to reach an agreement over the debt ceiling by the Oct. 17 deadline. The federal government also remains mostly closed because politicians have yet to pass a budget for the current fiscal year.

Yesterday's rally was broad-based, led by financials, industrials, and consumer cyclicals. International stocks also climbed and continue to outshine the United States in the nearer term. Our researchLAB market scanner shows, for instance, that S&P 500 is the third-best performing country index on a year-to-date basis. But in the last three months, it ranks 19th out of 22. Spain, Italy and Brazil have led during that time.

News from overseas markets will continue in the near term: China reports trade figures tonight, the Eurozone reports industrial production Monday morning and Germany's Zew survey of investor confidence follows on Tuesday.

Then U.S. corporate earnings pick up the pace. Today's big report came from JP Morgan, which is up 1.5 percent in early trading after quarterly profit beat expectations. Wells Fargo issues numbers later this morning. Citigroup appears on Tuesday, followed by Yahoo, Intel, Bank of America, eBay, International Business Machines, Goldman Sachs, Google and Morgan Stanley. Today's only economic release in the U.S. is consumer sentiment at 9:55 a.m. ET. (See related calendar story)

Trading is bullish in foreign-exchange markets, with the euro and Australian dollar higher and the safe-haven Japanese yen falling. Commodities are mixed, as oil and precious metals decline. Perhaps more importantly, the bigger drop is occurring in West Texas Intermediate crude rather than Brent, which is potentially bullish for refiner stocks. Copper is eking out small gains and agricultural products are mostly lower.

Other companies aside from JPM are moving: Supermarket chain Safeway is rallying 7 percent after announcing that it would exit the highly competitive Chicago market. IT-outsourcing company Infosys is up 5 percent after announcing strong quarterly results, and Osiris Therapeutics rose 21 percent after selling one of its product lines for as much as $100 million.

Retailer Gap may fall after reporting a surprise drop in same-store sales yesterday afternoon. Most retailers that report monthly numbers missed estimates yesterday.
Share this article with your friends

Related Stories


Calendar is busy before holiday

November 25, 2015

Today's agenda is packed with data, including mortgage applications, jobless claims, durable goods, personal income and spending, consumer sentiment, and new home sales.


Stocks fall after Russian jet downed

November 24, 2015

S&P 500 futures are down 0.6 percent, while most of Europe has fallen more than 1 percent. Asian markets were little-changed.


GDP, consumer confidence on tap

November 24, 2015

The second reading on third-quarter GDP is scheduled for 8:30 a.m. ET. Forecasters anticipate growth of 2 percent, up from the previously reported 1.5 percent gain.


Stocks drift into busy week of data

November 23, 2015

S&P 500 futures are little-changed, while most of Europe is fractionally lower. Asia also posted small losses overnight. There's also significant volatility in oil.


Busy docket before Thanksgiving

November 23, 2015

Today brings the Chicago Federal Reserve's regional activity index at 8:30 a.m. ET and existing home sales at 10 a.m. ET.


Premium Services

Education & Strategy

The art of trading

As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »