Post by Dave on Sept 11, 2020 2:38:48 GMT -8
Good morning, it’s Friday. The pre-market is green this morning at +$1.96 at this moment. How will we end this week?
$718 mln options unwind signals more caution on tech stocks
Dow Jones Futures Rise: Riskier Than A Bear? Why This Stock Market Is So Dangerous; Peloton Jumps On Earnings
$718 mln options unwind signals more caution on tech stocks
NEW YORK, Sept 10 (Reuters) - A large options player unwound bets on several technology-related companies on Thursday, offering another sign of the market's recently diminished appetite for shares in the sector.
The unidentified investor took off around $718 million of notional value in bullish options spreads known as risk reversals in Facebook Inc, Netflix Inc and Adobe Inc, according to a Reuters analysis based on data from Susquehanna Financial Group. The investor partially closed a similar position in Saleforce.com Inc on Tuesday.
The trades were structured differently than positions widely attributed to SoftBank Group Corp, whose big bets on equity derivatives tied to tech firms came to light last week.
Thursday's unwinds were partial, and the positions still have a notional value of around $1.66 billion, the analysis showed.
Still, investors following large institutional trades in tech-related names may view the moves as a bearish signal, said Christopher Murphy, co-head of derivatives strategy at Susquehanna Financial Group.
The unidentified investor took off around $718 million of notional value in bullish options spreads known as risk reversals in Facebook Inc, Netflix Inc and Adobe Inc, according to a Reuters analysis based on data from Susquehanna Financial Group. The investor partially closed a similar position in Saleforce.com Inc on Tuesday.
The trades were structured differently than positions widely attributed to SoftBank Group Corp, whose big bets on equity derivatives tied to tech firms came to light last week.
Thursday's unwinds were partial, and the positions still have a notional value of around $1.66 billion, the analysis showed.
Still, investors following large institutional trades in tech-related names may view the moves as a bearish signal, said Christopher Murphy, co-head of derivatives strategy at Susquehanna Financial Group.
Dow Jones Futures Rise: Riskier Than A Bear? Why This Stock Market Is So Dangerous; Peloton Jumps On Earnings
Dow Jones futures rose Friday morning, along with S&P 500 futures and especially Nasdaq futures. The stock market rally opened strong on Thursday but closed sharply lower, a bearish sign. The Nasdaq hit resistance at its 21-day exponential moving average and closed below its 50-day line.
Meanwhile, the clock is once again ticking for a TikTok deal. After reports that the U.S. might not require China's ByteDance to sell the U.S. operations of the viral video site, President Trump said late that he won't extend his mid-September deadline. "We'll either close up TikTok in this country for security reasons, or it will sold.....there will be no extension of the TikTok deadline."
Microsoft and Walmart (WMT) have teamed up on a TikTok bid. Both Dow giants rose a fraction late. Oracle is another possible suitor.
Stock Market Reversal
The stock market rally opened with strong gains, with the Nasdaq extending Wednesday's rebound from the 50-day line. But the index reversed lower after hitting the 21-day exponential moving average, which had acted as a support level during most of the current market rally. The major indexes and leading stocks whipsawed back and forth during the session, with the Nasdaq closing just below its 50-day line again.
Apple, Amazon, AMD, Adobe, ServiceNow and Facebook all moved above their 21-day lines intraday but reversed lower. Tesla stock also couldn't hold its 21-day line, but did close modestly higher. Microsoft hit resistance at its 21-day line. Nvidia, which had closed above its 21-day on Wednesday, fell below that key level Thursday.
Meanwhile, the clock is once again ticking for a TikTok deal. After reports that the U.S. might not require China's ByteDance to sell the U.S. operations of the viral video site, President Trump said late that he won't extend his mid-September deadline. "We'll either close up TikTok in this country for security reasons, or it will sold.....there will be no extension of the TikTok deadline."
Microsoft and Walmart (WMT) have teamed up on a TikTok bid. Both Dow giants rose a fraction late. Oracle is another possible suitor.
Stock Market Reversal
The stock market rally opened with strong gains, with the Nasdaq extending Wednesday's rebound from the 50-day line. But the index reversed lower after hitting the 21-day exponential moving average, which had acted as a support level during most of the current market rally. The major indexes and leading stocks whipsawed back and forth during the session, with the Nasdaq closing just below its 50-day line again.
Apple, Amazon, AMD, Adobe, ServiceNow and Facebook all moved above their 21-day lines intraday but reversed lower. Tesla stock also couldn't hold its 21-day line, but did close modestly higher. Microsoft hit resistance at its 21-day line. Nvidia, which had closed above its 21-day on Wednesday, fell below that key level Thursday.