The Prepared Mind 4.15.2013

“Chance favors the prepared mind.” — Louis Pasteur

The week started with 4 consecutive days with moves higher before a sell-off on Friday. Record highs continued last week.  The S&P 500 posted a a record intraday high at 1,597.36 and a record closing high at 1593.35.  The broad-based indexes all rallied 2% or more last week.   The NDX closed at 2,856.48, a gain of 84.73, a gain of 84.73 points or 3.06%.  The Russell 2000 (RUT) exhibited the strength of the small caps by closing at   941.39 a gain of 19.39 points or 2.10%.  The Dow Jones Industrial Average (DJIA) is at 14,865.06 up nearly 300 points to gain 2.06%    The S&P 500 (SPX) closed at 1,588.85 up 35.57 points or a gain of 2.29%.  The S&P 100 (OEX) gained 15.89 points to close at 715.38 – a gain of 2.27%..  The VIX and the other volatility indexes were up for the week.    Theses volatility levels reflected overall market and a lack of concern about North Korea, the Eurozone, and the state of the domestic economy.  The VIX closed last week at 13.92, gain of 1.22  or a weekly gain of 13.92%.  Here is a capsule view of last week’s market numbers:

Index Close Weekly Change % Weekly % YTD Volatility of  Index
Dow Jones Industrials (DJIA)

14,865.06

299.81

2.06%

13.44%

11.11% (VXD)

S&P 500 (SPX)

1,588.85

35.57

2.29%

11.41%

12.06% (VIX)

NASDAQ 100 (NDX)

2,856.48

84.73

3.06%

7.35%

13.88% (VXN)

Russell 2000 (RUT)

941.39

19.36

2.10%

10.57%

16.06% (RVX)

S&P 100 (OEX)

715.38

15.89

2.27%

10.64%

12.04%(VXO)

CBOE Volatility Index (VIX)

12.06

-1.89

-13.58%

NA

 

All eyes will be on Dow 16,000 and SPX 1,600.  Consensus seems to be that North Korea is bluffing and cheap money will continue indefinitely.   The earnings season will swing into full force this week.  The announcements include Citigroup, BlackRock, Goldman Sachs, Intel, WW Grainger, American Express, eBay,Bank of New York, Capitalone, Google, Quest, Morgan Stanley, Abbott Labs,  Baxter International, IBM, PepsiCo, Microsoft, Honeywell, McDonalds, and General Electric. These earnings should trump all other news.  The announcements can increase the prices and implied volatility of individual options. You should be aware of the earnings date for any equities you trade.   I have scanned stocks with upcoming earnings using the following criteria:  Price > 20, 30 Day Implied Volatility > 20, and Average Daily Option Volume > 200 contracts.  It is your responsibility to confirm the earnings dates. Continue to be wary of trading any products where there is not adequate liquidity and narrow enough markets.  You should be aware of daily volume and open interest in any products you trade.   I am including a consensus earnings estimate for each stock.  Stick with your plan.    Remain disciplined.  Remain on top of market news and movers.  Do not chase profits and disregard risk.

Remember:

  “Chance favors the Prepared Mind.” – Louis Pasteur

This week’s economic news (All times are Eastern Daylight Time.) Events, dates and times are subject to change:

Monday April 15:

Economic:  Empire State Manufacturing Survey  – 8:30, Treasury International Capital – 9:00, Housing Market index – 10:00.

Optionable Earnings:

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

C Citigroup Inc.

$44.87

26.4

B

$1.18

 

Tuesday April 16:

Economic:   ICSC-Goldman Sachs Retail Sales – 8:30, Housing Starts – 8:30, Redbook – 8:55 , Industrial Production – 9:15.  

OtherFederal Reserve Gov. Elizabeth Duke addresses the American Banking Association in Washington – 12:00, Minneapolis Federal Reserve Bank President Narayana Kocherlakota speech to Market Technicians Association, Minneapolis – 1:00, Federal Reserve Vice Chair Janet Yellen chairs panel, including Bank of England Gov. Mervyn King, on monetary policy at IMF conference in Washington – 3:00.

Optionable Earnings:  

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

BLK BlackRock Inc.

$264.14

21.3

B

$3.59

CMA Comerica Inc.

$35.45

25.6

B

$0.67

GS Goldman Sachs Group Inc.

$149.07

25.4

B

$3.77

GWW W.W. Grainger Inc.

$228.87

24.2

B

$2.73

CSX CSX Corp.

$24.28

23.2

A

$0.40

INTC Intel Corp.

$21.83

26.1

A

$0.42

URI United Rentals Inc.

$55.21

45.0

A

$0.50

YHOO Yahoo! Inc.

$24.49

30.7

A

$0.25

Wednesday April 17:

Economic:  MBA Purchase Applications – 7:00, EIA Petroleum Status Report – 10:30, Beige Book – 2:00.

Other:  Federal Reserve Gov. Jeremy Stein on panel discussing financing regulation at IMF conference in Washington – 9:00AM, St. Louis Federal Reserve Bank President James Bullard speech to the Levy Institute in New York – 9:30AM,  Boston Federal Reserve Bank President Eric Rosengren speech to the Levy Institute in New York.

Optionable Earnings:

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

ASML ASML Holding NV

$69.32

33.8

B

$0.53

BK The Bank of New York Mellon Corporation

$28.65

22.3

B

$0.52

DGX Quest Diagnostics Inc.

$59.83

24.7

B

$1.04

DOV Dover Corp.

$74.70

24.0

B

$1.08

MAT Mattel Inc

$44.22

22.7

B

$0.08

TXT Textron Inc.

$29.94

31.1

B

$0.47

EBAY eBay Inc.

$57.78

30.4

A

$0.54

NE Noble Corp.

$37.45

37.3

A

$0.58

SLM SLM Corp.

$20.78

25.5

A

$0.59

SNDK SanDisk Corp.

$58.62

37.8

A

$0.66

KMI Kinder Morgan, Inc.

$38.77

22.1

d

$0.32

 

Thursday April 18:

Economic:  Jobless Claims – 8:30, Bloomberg Consumer Comfort Index – 9:45, Philadelphia Fed Survey – 10:00, Leading Indicators – 10:00,  EIA Natural Gas Report – 10:30.

Other:  Last day of trading for options on SPX, NDX, and RUT indexes.  Minneapolis Federal Reserve Bank President Narayana Kocherlakota speech to the Levy Institute in New York – 9:00AM, Federal Reserve Gov. Sarah Bloom Raskin speech to the Levy Institute in New York – 3:00.

Optionable Earnings:

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

AN AutoNation Inc.

$44.56

28.1

B

$0.64

BAX Baxter International Inc.

$71.87

30.0

B

$1.04

BBT BB & T Corp.

$31.24

21.5

B

$0.67

BPOP Popular Inc.

$29.39

29.5

B

$0.61

BTU Peabody Energy Corp.

$20.83

46.5

B

($0.14)

BX The Blackstone Group

$21.10

31.4

B

$0.54

FCX Freeport-McMoRan Copper & Gold Inc.

$32.79

31.7

B

$0.76

MS Morgan Stanley

$22.27

32.2

B

$0.56

NUE Nucor Corp.

$44.99

25.4

B

$0.26

PENN Penn National Gaming Inc.

$55.60

25.5

B

$0.64

PPG PPG Industries Inc.

$137.61

26.0

B

$1.56

SHW Sherwin-Williams Co.

$171.02

21.7

B

$1.08

TZOO Travelzoo Inc.

$22.05

50.4

B

UNH Unitedhealth Group Inc.

$62.98

21.4

B

$1.16

UTEK Ultratech Inc.

$37.97

43.6

B

$0.48

ALGN Align Technology Inc.

$32.86

53.4

A

$0.23

CE Celanese Corp.

$44.97

30.9

A

$0.81

CMG Chipotle Mexican Grill Inc.

$331.33

38.0

A

$2.15

COF Capital One Financial Corp.

$54.82

27.2

A

$1.64

CYT Cytec Industries Inc.

$75.33

31.4

A

$0.86

GOOG Google Inc.

$790.39

26.2

A

$8.79

ISRG Intuitive Surgical Inc.

$512.57

37.3

A

$3.99

MSFT Microsoft Corporation

$28.94

23.4

A

$0.74

 

 

Friday April 19:

Economic:  Producer Price Index – 8:30, Retail Sales – 8:30, University of Michigan/Reuters Consumer Sentiment – 9:55, Business Inventories – 10:00.

Other:  April options expiration

Optionable Earnings:

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

BHI Baker Hughes Inc.

$46.70

30.1

B

$0.63

COL Rockwell Collins Inc.

$63.69

22.0

B

$1.16

KMB Kimberly-Clark Corp.

$101.12

20.2

B

$1.34

KSU Kansas City Southern

$107.21

29.3

B

$0.87

SAP SAP AG

$78.91

26.8

B

$0.53

SLB Schlumberger Limited

$77.14

23.4

B

$1.00

STI SunTrust Banks Inc.

$28.98

26.4

B

$0.62

STT State Street Corp.

$60.48

27.2

B

$0.93

UA Under Armour Inc.

$56.03

37.5

B

$0.03

 

 

 

Monday April 22:

Economic:  Chicago Fed National Activity Index – 8:30, Existing Homes Sales – 10:00.

 Optionable Earnings:

Symbol

Company Name

April 12 close

IV30

B/A

XEPS

BEAV BE Aerospace Inc.

$59.91

25.3

B

$0.80

CAT Caterpillar Inc.

$85.70

22.9

B

$1.38

CHKP Check Point Software Technologies

$47.29

31.5

B

$0.73

HAL Halliburton Company

$41.17

29.4

B

$0.58

HAS Hasbro Inc.

$45.07

23.0

B

$0.03

AMP Ameriprise Financial Inc.

$75.28

24.2

A

$1.58

ILMN Illumina Inc.

$57.95

33.2

A

$0.38

NFLX Netflix Inc.

$173.01

77.0

A

$0.18

NXPI NXP Semiconductors N.V.

$29.86

48.8

A

$0.49

TXN Texas Instruments Inc.

$35.69

24.4

A

$0.31

VECO Veeco Instruments Inc.

$37.88

48.1

A

$0.06

ZION Zions Bancorp.

$24.94

29.6

A

$0.39

 

 

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