Opening View: DJIA Futures Slip as China Hikes Reserve Rate, Again

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Technically, the DJIA closed above the 12,300 level for the first time since June 18, 2008 yesterday, extending the blue chip barometer's impressive rally along its 10-day and 20-day moving averages. In fact, the Dow has not closed a session below this duo since Nov. 30, 2010. Levels to watch include potential resistance near 12,400, and support in the 12,300-12,250 region. The SPX, meanwhile, vaulted above the 1,340 level on Thursday -- territory not seen since June 19, 2008. The broad-market index has enjoyed its own rally along its 10-day and 20-day trendlines, closing only one session below this pair since Nov. 30. Look for the SPX to meet with resistance in the 1,345-1,350 area, while support could emerge near the 1,333.58 level -- which marks a double of the index's March 2009 low .

In equities news, Ford Motor Co. ( F ) announced plans to enter a joint venture with Russian automotive group Sollers OJSC to produce and distribute Ford vehicles in Russia. The venture will be called Ford Sollers and will utilize local production facilities from both companies in the St. Petersburg region and in the Republic of Tatarstan. The pair said that production should begin by the end of 2011.

In earnings news, Campbell Soup Co. ( CPB ) reported second-quarter earnings of $239 million, or 71 cents per share, as sales fell to $2.13 billion from $2.15 billion last year. Looking ahead, the company lowered its fiscal 2011 earnings forecast to a decline of between 1%-3%, with sales seen in a range of down 1% to up 1%. Campbell had previously said it expected 2011 earnings growth of 2%-4%, with sales up 1%-3%.

After the close last night, Brocade Communications ( BRCD ) posted a fiscal first-quarter profit of $27 million, or 6 cents per share, on revenue of $546 million. Adjusted income arrived at 12 cents per share. Analysts had expected the company to post earnings of 10 cents per share on revenue of $543.7 million.

Finally, Intuit Inc. ( INTU ) banked a fiscal second-quarter profit of $73 million, or 23 cents per share, on revenue of $878 million. Excluding one-time items, Intuit said earnings for the quarter weighed in at 32 cents per share. Analysts had expected Intuit to report earnings for the quarter of 32 cents per share on $891.8 million in revenue.

Earnings Preview

On the earnings front, Brookfield Asset Management ( BAM ) and Healthspring (HS) are slated to release their quarterly earnings reports. Keep your browser at SchaeffersResearch.com for more news as it breaks.

Economic Calendar

There are no economic reports slated for release today. Monday is also devoid of data, as the market is closed due to the President's Day holiday. Tuesday kicks things off next week with the Case-Shiller 20-city home price index for December and the February consumer confidence index.

Market Statistics

Equity option activity on the Chicago Board Options Exchange (CBOE) saw 1,734,941 call contracts traded on Thursday, compared to 866,722 put contracts. The resultant single-session put/call ratio arrived at 0.50, while the 21-day moving average held at 0.56.

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

Trading the News: A Contrarian View. Check out this special report from Bernie Schaeffer here.

Overseas Trading

Overseas trading is divided this morning, as five of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a loss of 0.04%. In Asian trading, China's Shanghai Composite declined for the first time in seven sessions, with investors fretting over the potential for additional tightening measures out of Beijing. In fact, the People's Bank of China hiked the reserve ratio for banks for the second time this year, this time by 0.5%. The move has created a bit of a stir in European trading, where stocks reversed early gains to trade broadly lower.

Overseas markets

Currencies and Commodities

The U.S. dollar is headed higher versus most of its foreign rivals this morning, with the U.S. Dollar Index up 0.2% at 78.15 in premarket trading. However, the index is finding resistance at its 10-day moving average and the 78.20 level - a region that has alternated between support and resistance since late January. The stronger greenback is creating drag for commodities. For instance, crude futures have added a meager 7 cents to $88.91 per barrel in electronic trading. Additionally, gold has added $1.50 to trade at $1,386.60 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

Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.



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This article appears in: Investing , Options

Referenced Stocks: BAM , BRCD , CPB , F , INTU

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