11:45am (EST)
Futures were slightly higher throughout the night and into this morning but turned negative shortly before the opening bell on mixed economic data. The reports weren’t market movers as Wall Street and the globe will be focused on the news out of Washington DC this week.
We went over the political rhetoric in our Weekly Wrap and in this morning’s Daily so we would rather talk stocks than rehash the upcoming zombie drama.
Apple (AAPL, $485.09, up $17.68) made a push to $500 on the open after saying it sold 9 million new IPhones over the weekend. Bullish analysts had expectations of maybe 5-6 million units being sold and once again underestimated the company’s ability to create buzz.
The gold iPhone 5S sold out with reports of the gold model going for a dime ($1,000) on eBay (EBAY, $54.54, down $0.41). The stores are still getting new shipments regularly so sales could be strong all week. Apple also said over 200 million users have downloaded their latest iOS 7 software and that it now has over 11 million users for its recently launched iTunes Radio.
We listed some Apple call options last week on a possible push to $500 and they have done well today. Although it wasn’t an official recommendation, savvy traders locked-in some nice profits on the initial pop.
We also want to take a minute to talk about BlackBerry (BBRY, $8.22, down $0.51) following Friday’s plunge from over $10 to single-digits.
We mentioned in our Weekly Wrap that we expected shares to test $8 as we were looking for a short candidate but the buyout rumors needed to die down before we pulled the trigger.
We didn’t get the opportunity as shares dropped like a rock last Friday after the company warned Wall Street it would miss estimates. BlackBerry is slated to announce their numbers this Friday but has a history of giving the suit-and-ties a heads up.
The stock is dead money over the near-term with risk down to $6 and upside potential to $10. The easy money has been made and the current risk/ reward isn’t too appealing to go long or short. Perhaps selling options against the stock would work but those returns are limited and also not worth the risk.
As far as the market, the indexes are off their lows and are trying to hold the first wave of support. While we expected a lower Monday, there is a chance the bulls make once last push at new highs if the pullback doesn’t get worse so the close will be important.
The Dow is down 55 points to 15,396 while the S&P 500 is lower by 9 points to 1,700. The Nasdaq is off 20 points to 3,755.
We have some nice pin action going so we wanted to go to press a little early as we have a Profit Alert for one of our current trades. We could have additional Profit Alerts and/ or New Trades for both our Daily and Weekly Wrap so stay close to your email inboxes after lunchtime! Subscribers, hit the Members Area for now.
