1:25pm (EST)
The bulls are pushing resistance once again after better-than-expected profit results from Goldman Sachs (GS, $103.96, up $6.28) which has helped the Financial stocks. Economic news has also topped expectations with housing providing strength and Tech continues to look strong. News that a Greek debt deal could come by the end of the week is also helping the major indexes.
One negative headline that could have helped jobs is news that the White House is planning to reject the Keystone pipeline project. Once again, blame the Obama administration for “not getting it” as this was a big deal with our neighbors up North. Canada is trying to help us with our oil imports and the government thinks it would be better to not create 20,000 jobs and that China needs the oil more than us. So much for “shovel ready jobs”…
The Producer Price Index fell 0.1% in December, versus expectations for an increase of 0.1%. The good news, after backing out food and energy, prices rose 0.3% which was higher than forecasts for an increase of 0.1%. Elsewhere, Industrial Production rose 0.4% in December while Capacity Utilization advanced to 78%, which matched expectations. The NAHB Housing Market Index came in at 25 compared to a forecast of 22.
eBay (EBAY, $30.16, down $0.37) will announce their quarterly results after the close today and the option pits are active. Wall Street expects the company to earn 57 cents a share on revenue of $3.3 billion. Traders are pricing in a 5% move for the stock with the January 30 calls (EBAY120121C00030000, $0.95, down $0.30) and the January 30 puts (EBAY120121P00030000, $0.75, up $0.10) trading over 5,000 contracts, together.
The January 29 puts (EBAY120121P00029000, $0.40, up $0.02) have traded over 10,000 contracts while the January 28 puts (EBAY120121P00028000, $0.18, flat) have traded over 8,000 contracts.
We like eBay as a possible covered call candidate for our Weekly Wrap portfolio and we would like to see a drop below $30 but our feeling is they could have a really good quarter on the continued strength of their PayPal business.
As far as the market, the Dow is up 73 points to 12,555 while the S&P is higher by 10 to 1,304 and has taken out yesterday’s high of 1,303. The Nasdaq is showing a gain of 32 points and is at 2,760. Subscribers, check the Members Area for the updates and we will see the rest of you in the AM on Thursday.
