Blogging Options: CBOE Morning Update 11.7.13

Big happenings today before we look at individual stocks.

Twitter (TWTR) begins trading within the next two hours.  IPO went off at $26, we’re hearing $30 when stock opens.  30X oversubscribed, higher than average. News channels with “team coverage” at post #9, you’d think this was a slow news day.

But it’s not!

The ECB surprised everyone this morning and dropped rates by 25 basis points to 0.25%.  Markets liking this.  3Q GDP at 2.8% higher than expected.  Weekly Jobless at 336k.

Volatility as an asset class

Qualcomm (QCOM) is down $2.43 to $67.29 in the premarket after the telecommunications company reported Q4 profit and Q1 profit and sales outlook that fell short of expectations. November weekly call option implied volatility is at 71, November is at 30, December is at 27, January is at 21; compared to its 26-week average of 24.

Costco (COST) is indicated higher (+$0.33) after reporting October comparable store sales rose 3%. November weekly call option implied volatility is at 47, November and December is at 15, January is at 14; compared to its 26-week average of 18.

Mondelez (MDLZ) is indicated higher after the food maker reported higher organic sales and raised 2013 EPS outlook to $1.57-$1.62, compared to consensus $1.55. November weekly call option implied volatility is at 94, November is at 33, December is at 23, March is at 21; compared to its 26-week average of 24.

American Eagle (AEO) is up $2.14 to $16.79 after the teen-retailer raised Q3 earnings outlook.  Overall option implied volatility of 48 is above its 26-week average of 37.

Whole Foods Markets (WFM) is down $6.07 to $58.40 in the premarket after the food retailer reported deterioration in same-store-sales and lowered its outlook. November weekly call option implied volatility is at 65, December is at 27, January is at 25; compared to its 26-week average of 30.

Options expected to be active @ CBOE; NDLS ATVI WFM QCOM AEO RF PCLN DIS SBUX GRPN

CBOE S&P 500 BuyWrite Index (BXM) closed at $992.46, above its 50-day moving average of 968.37. www.cboe.com/BXM

CBOE DJIA BuyWrite Index (BXD) closed at 248.04, above its 50-day moving average of 243.71. http://www.cboe.com/micro/bxd/

CBOE S&P 500 PutWrite Index (PUT) closed at 1339.95, above 10-day MA of 1336.53 www.cboe.com/PUT

CBOE S&P 500 95-110 Collar Index (CLL) closed at $593.85 www.cboe.com/CLL

CBOE S&P 500 Short-Term Volatility Index (VXST) at 11.61. VXST is a new market-based gauge of expectations of 9-day volatility   cboe.com/vxst

CBOE Volatility Index (VIX) closed at 12.67, near its 10-day moving average of 13.25 and below its 50-day moving average of 15.01. www.cboe.com/VIX

Calls with increasing volume at CBOE:

SPY 11/16/2013 177 16K contracts
PBR 11/29/2013 18.50 10K
EWW 11/16/2013 66 9K
EEM 11/16/2013 42.50 9K
MSFT 11/16/2013 38 7K

SPDR S&P 500 ETF Trust (SPY) was off slightly in the premarket on concerns the U.S. economic growth has slowed.  The Dow Jones Industrial average had closed at a record high.  BUT, with the ECB announcement, looking higher.