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Buzz Bits: Dow Slips Slightly, Nasdaq Creeps Higher


Your daily Buzz highlights...


Editor's Note: This is a small sample of the content available on the Buzz and Banter.

Earnings Report - MV News

(INTU) reports 4Q GAAP EPS of ($0.06) including items and is not comparable to ($0.06) cons on revs of $342.9 mln vs. $322.2 mln.

Medtronic (MDT) reports 1Q EPS of $0.55 vs. $0.54 cons on revs of $2.90 bln inline with cons.

More Answers I Really Wanna Know... - Todd Harrison - 3:44 PM

  • Do you think Sisyphus was a trader in a former life?

  • Does the lack of relative jig in the homies (following Toll Bros earnings) imply that alotta shorts have already covered?

  • Are you ready for some football?

  • If you're staring at one stock all day, why don't you pare your exposure a bit?

  • Why is it that I don't wanna see the Red Sox in the playoffs despite the broom hilda?

  • What would you be doing right now if you weren't spending another day sitting in front of your screens?

  • Do you think David Miller still thinks of his first MIM softball victory every day?

  • All this motion and the NDX is down 2.5% this year?

  • Are we there yet?


So you want something to worry about? - David Miller - 1:33 PM

  • NYSE short interest up 3.5%, price up 2.19%. Is this a market where nobody makes any money?
  • If you want a bug to worry about, MRSA is the one to concern yourself with. A vaccine against streptococcal bacteria is (was?) in development by Glaxosmithkline (GSK) (via their acquisition of ID Biomedical), but ninnies at the FDA set the program back a couple of years with no good reason.
  • This might be August 2004. Are you long enough?
  • The Fed might be in 2H-2000 break-the-speculators mode. Are you overinvested?
  • If pharma is willing to pay 6x for a private company than they will for a similar public company, does that mean the fundamentals of publicly-traded biotech companies are so whacked that we'd be better off flipping coins?

Home on the range... - Jason Roney - 12:41 PM

The Dow has had four consecutive day's ranges tighter than the previous day's range. As of now, today's range is still smaller than yesterday's range, potentially marking the 5th consecutive tighter range. Sure it's August and we're typically slow - but i suspect we get some sort of range expansion today or tomorrow.

My bags are packed I'm ready to go... - John Succo - 12:32 PM

Options prices are now at extreme low levels. I am actually buying options in one bank name "in the single digits." Folks, that is a level that indicies rarely reach these days.

This illustrates extreme complacency and is typical after a spike in volatility. I did not expect prices to return back to these levels. Didn't people learn their lesson just a few weeks ago?

Of course they didn't. This is a form of extreme risk taking.

For my part I am now longer gamma/convexity than ever.

The Tug of War Continues... literally - Kevin Depew - 11:02 AM

  • Take a look at the NDX vs. the RUT. While the SPX is outperforming the RUT intra-day, the relative outperformance of the NDX versus both SPX and RUT continues to gain strength.
  • That is no surprise on the one hand, given the relatively washed out conditions of NDX stocks, but it is one of the few times we've seen the RUT remain an underperformer vs. SPX while the NDX outperforms.
  • I'm not sure what to make of it other than relief from oversold conditions, but I would note the bullish percent for the NDX is positive, compared to the bullish percents for both the SPX and RUT, which are both negative, according to data from Investor's Intelligence.
  • The NDX bullish percent is in Xs at 32%, a very low level.
  • The SPX bullish percent has been sluggish at best from a recent low of 48%, and is still more than 2% net new PnF buy signals away from a reversal back to Xs.

Position in RUT/SPX equivalents

Volatile - Adam Warner - 9:50 AM

I mentioned yesterday that longer dated volatility in the S&P had given back all of its Spring Fling. Well, going a bit further under the hood, options have held their bid a tad better. Particularly if you go *beta*, which has had some well documented underperformance recently.

Here's the rolling 120 Day volatility of the IBB, graphed over the past 2 years. Options actually trade on the high side of *normal*, despite a relatively stable stock over an extended stretch.

This pup is fairly consistent with a *bid* in smaller options that is relatively high compared to Big Cap.

Conclusion? There's still some vestiges of Fear out there, but it feels more like fear of missing that grand move into Big than anything else.

I really hate to keep bringing up old subjects, but...see this chart of... - Bennet Sedacca - 8:59 AM

...the continuous contract of the 10 year note. Resistance lies as it has, in the 107-16 to 107-24 area that my firm noted much of the early part of this year and were fortunately positioned for it.

What happens now? Well, this still represents a gigantic flag pattern in my book and is the second reason for us not playing the longer end at the moment. As you can see, resistance is also in the 109-110 range, so at 107 or so in year futures at present, we are not real bulls on this part of the curve.

We could be wrong, but don't want to get whacked by that 2x4 that is always waiting just around the corner. So we are content in the two and three year part of the curve for now.

Funny thing, the stock market seems to think we have a Goldilocks economy and the bond market is currently thinking hard landing with this inversion. Only one can be right. Stay tuned.

Position in various Treasury notes

What you need to know... - Jon Doctor J Najarian - 8:13 AM

AOL Cans Chief Tech On Data Leak - AOL's chief technology officer and two other workers were let go in the aftermath of a privacy breach that involved the intentional release of more than 650,000 subscribers' Internet search terms. The change takes effect immediately, according to a memo AOL Chief Executive Jonathan Miller sent to employees on Monday.

Gov Says Owners Must Be Told About Vehicle "Black Boxes" – According to the National Highway Traffic Safety Administration auto owners need to be told if their vehicles are equipped with event data recorders, commonly called "black boxes," The recorders can provide hard data for crash investigators.

Cisco (CSCO) Acquire Arroyo Video Solutions – Another day another deal at CSCO! Today it's the purchase of privately-held Arroyo Video Solutions, a provider of next-generation solutions for on-demand television and related consumer services. Under the terms of the agreement, Cisco will pay approx $92 mln in cash.

Position in CSCO

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No positions in stocks mentioned.

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