Opening View: DJIA, SPX Grasping for Support

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Despite the recent sell-off, the Dow Jones Industrial Average ( DJIA ) continues to tread water near support at the 10,800 level and its 10-week moving average. That said, the current pullback is only about half the size of the Dow's drop of about 5.6% in late January and early February. The S&P 500 Index ( SPX ) is in a similar situation, hovering just above support in the 1,160 area. However, the SPX has fallen further below its 10-week moving average. Heading into the open, the bulls may get a reprieve, as futures on the DJIA and the SPX are trading roughly 29 points and 3.5 points above fair value, respectively. Finally, the 21-day moving average of the Chicago Board Options Exchange ( CBOE ) single-session put/call ratio has moved higher during the past two sessions, a signal last seen on Feb. 25.

The retail sector will be front and center this morning, following the release of same-store sales data. Specifically, Costco Wholesale Corp. ( COST ) reported April same-store sales rose 11%, as net sales rose 13% to $5.83 billion. Excluding higher gasoline prices and the benefit of stronger foreign currencies, total same-store sales rose 4%. Shares of COST are up nearly 1% in pre-market trading.

Elsewhere, Big Lots Inc. ( BIG ) said first-quarter sales rose 8.1% to $1.22 billion. What's more, same-store sales rose 6%, arriving at the higher end of the company's guidance for a 4% to 6% increase. In electronic trading, BIG is trading flat to fractionally lower.

In earnings news, Transocean Ltd. ( RIG ) posted a first-quarter profit of $2.09 per share, as revenue slid to $2.6 billion. Analysts had forecast earnings of $2.14 per share on revenue of $2.66 billion. RIG has risen more than 2% in pre-market trading.

Finally, Hot Topic Inc. ( HOTT ) narrowed guidance for its first quarter to a loss of 3 cents to 4 cents per share, compared with prior expectations for a loss of 2 cents to 5 cents per share. The company also noted that April same-store sales fell 12.5%. Analysts had expected same-store sales to drop 7.9%. HOTT is off nearly 5% in electronic trading.

Earnings Preview

On the earnings front, CIGNA Corp. ( CI ), Cincinnati Bell Inc. ( CBB ), DIRECTV ( DTV ), Dr Pepper Snapple Group Inc. ( DPS ), El Paso Corp. ( EP ), Fuel Systems Solutions Inc. ( FSYS ), SandRidge Energy Inc. ( SD ), Hyatt Hotels Corp. ( H ), MGM MIRAGE ( MGM ), Plains Exploration & Production Co. ( PXP ), Omnicare Inc. ( OCR ), Scripps Networks Interactive Inc. ( SNI ), Sara Lee Corp. ( SLE ), Warner Music Group Corp. ( WMG ), bebe stores inc. ( BEBE ), Blue Nile Inc. ( NILE ), Consolidated Edison Inc. ( ED ), Crocs Inc. ( CROX ), General Cable Corp. ( BGC ), Kraft Foods Inc. ( KFT ), Leap Wireless International Inc. ( LEAP ), and STEC Inc. ( STEC ) are slated to release their quarterly earnings reports. Keep your browser at SchaeffersResearch.com for more news as it breaks.

Economic Calendar

Market Statistics

Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,842,132 call contracts traded on Wednesday, compared to 1,291,757 put contracts. The resultant single-session put/call ratio arrived at 0.70, while the 21-day moving average rose to 0.51.

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

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Overseas Trading

Overseas trading is mixed this morning, as five of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective arrives at a loss of 0.79%. In Asia, stocks fell, led by Tokyo and Shanghai, as more signs emerged that the fallout from the Greek debt crisis could spread. Meanwhile, European shares bounced back, recovering earlier sharp falls as strong results from BNP Paribas boosted the banking sector. Overseas market information comes to you courtesy of Schaeffer's Daily Bulletin .

Overseas markets

Currencies and Commodities

The U.S. dollar has been on fire during the past couple of sessions, given the renewed concern about European sovereign debt. In fact, the U.S. Dollar Index hit an annual high just shy of the 85 level in overseas trading this morning. At last check, the index was up 0.24% at 84.29, pulling back slightly from earlier highs. In commodities, crude futures are hovering just above breakeven, adding 10 cents to $80.07 per barrel in electronic trading. Finally, gold futures are benefiting from safe-haven buying once again, with the malleable metal jumping $9.60 to $1,184.60 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

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This article appears in: Investing , Options


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