Opening View: DJIA Futures Rally on Ireland Hopes and General Motors IPO

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The Dow Jones Industrial Average (DJIA) closed above the 11,000 level by a hair's breadth yesterday, as global pressures overshadowed a solid round of domestic data. However, with Ireland close to accepting an aid package from the European Union and the International Monetary Fund, and traders learning of relatively modest monetary tightening measures from China, much of the downdraft on Wall Street has been diffused. In fact, futures on the DJIA and the S&P 500 Index (SPX) are trading 96 points and 12.4 points above fair value, respectively. Look for the DJIA to attempt to retake the 11,100 level today, with support holding firm in the 11,000 region. As for the SPX, the broad-market index appears poised to challenge potential resistance in the 1,195 level, while support should hold firm at 1,175.

In equity news, General Motors Co. ( GM ) will officially begin trading on the New York Stock Exchange (NYSE) today, after the company's initial public offering (IPO) was priced at $33 per share yesterday. The total size of the IPO is $20.1 billion, or as much as $23.1 billion if over-allotments are fully exercised. The offering will raise $18.2 billion, making GM's IPO the second largest in U.S. history.

Staples Inc. ( SPLS ) posted a third-quarter profit of 41 cents per share on an adjusted basis, as sales rose to $6.54 billion from the same quarter last year. Analysts were expecting earnings of 40 cents per share on revenue of $6.52 billion. Looking ahead, Staples said that it expects fourth-quarter earnings to be 39 cents to 41 cents per share, on an adjusted basis, compared to the current consensus estimate of 40 cents per share.

Elsewhere, Applied Materials ( AMAT ) said net income was $468 million, or 35 cents per share, compared with net income of $138 million, or 10 cents per share, for the same period last year. On a non-GAAP basis, the company said it earned $476 million, or 36 cents per share, for the recently concluded quarter. Revenue jumped 89% to $2.89 billion. Analysts were expecting earnings of 31 cents per share on $2.6 billion in revenue.

Finally, J.M. Smucker Co. ( SJM ) reported that its second-quarter profit was $149.7 million, or $1.25 per share, compared to $140 million, or $1.18 per share, in the year-ago period. Net sales were flat at $1.28 billion. Adjusted income was $1.49 per share. Analysts had expected a profit of $1.32 per share on sales of $1.32 billion.

Earnings Preview

On the earnings front, American Eagle Outfitters ( AEO ), Canadian Solar Inc. (CSIQ), Children's Place Retail Stores Inc. (PLCE), Dollar Tree Inc. (DLTR), GameStop Corp. (GME), Sears Holdings Corporation (SHLD), Autodesk Inc. (ADSK), Dell Inc. (DELL), The Gap Inc. (GPS), Intuit Inc. (INTU), Marvell Technology Group Ltd. (MRVL), and salesforce.com inc. (CRM) will release their quarterly reports today. Keep your browser at SchaeffersResearch.com for more news as it breaks.

Economic Calendar

The economic calendar ends the week early today, with weekly initial jobless claims, October's leading economic indicators, and November's Philadelphia Fed manufacturing index. There are no reports slated for release tomorrow.

Market Statistics

Equity option activity on the Chicago Board Options Exchange (CBOE) saw 1,330,182 call contracts traded on Wednesday, compared to 779,457 put contracts. The resultant single-session put/call ratio arrived at 0.59, while the 21-day moving average slipped to 0.59.

Volatility indices

NYSE and Nasdaq summary

**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**

Dow, S&P and Nasdaq futures

Overseas Trading

Overseas trading is in fine shape this morning, as all 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a gain of 1.39%. In Asian trading, Japan and Hong Kong led the way higher, with the yen continuing to fall versus the U.S. dollar, while Beijing's monetary tightening measures were less harsh than expected. Meanwhile, European markets are broadly higher on hopes for a resolution to Ireland's debt issues.

Overseas markets

Currencies and Commodities

The U.S. dollar has hit a weak patch this morning, as the euro found support in the wake of reports that Ireland's central bank will likely accept a loan from the European Union and the International Monetary Fund. At last check, the U.S. Dollar Index was down 0.74% at 78.50. The greenback's pullback has been a boon for commodities, with crude futures rallying 1.47% to $82.23 per barrel, while gold has jumped $18.20 to $1,355.10 an ounce in London.

Currencies and commodities

Unusual Put and Call Activity:

For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .

Unusual options activity - puts

Unusual options activity - calls

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This article appears in: Investing , Options

Referenced Stocks: AEO , AMAT , GM , SJM , SPLS

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