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Sentiment

Stocks are struggling in uninspired market action after the latest ISM manufacturing index fell short of expectations. The report, released 30 minutes into trading Monday, was down to 49.7 in June, from 53.5 in May and below estimates of 52.2. The poor reading overshadowed a better-than-expected .9% increase in May industrial production. Stock market averages fell into the red on the headline, but the selling never gathered any momentum. Volumes are light heading into Tuesday’s abbreviated trading session and Wednesday’s Fourth of July holiday. In Europe, stock market averages continued to rally. Germany’s DAX and France’s CAC 40 both gained more than 1%. However, crude oil lost $1.73 to $83.23 and gold slipped $6 to $1598 an ounce. Bonds are bid on the poor ISM print and the benchmark ten-year Treasury has added 24/32nd, bringing its yield back to 1.57%. The Dow Jones Industrial Average was down 50 points, but the Nasdaq was holding a 1-point gain. CBOE Volatility Index (.VIX) is up .31 to 17.39 amid light volumes in the options market. 4 million calls and 3.9 million puts traded so far.

Bullish Flow

Silicon wafer-maker MEMC Electronic Materials (WFR) is rallying on news it has won four solar contracts in Europe. Cash received will be reflected in second quarter balance sheets. The stock is up 36 cents to $2.53 on heavy volume of 7.7 million shares. Meanwhile, 8,520 calls and 720 puts traded in WFR. Aug 2.5 calls, which are now 3 cents in-the-money and expiring in 46 days, are the most actives. 5,180 traded. July 2, July 2.5. Aug 2, and Jan 2.5 calls are also seeing interest and 30-day ATM vols increased by 16.5 percent to 101.

Bearish Flow

Apollo Group (APOL) adds 51 cents to $36.70 amid strength in the space on reports a Federal Court has struck down a rule that would have tightened admission standards for for-profit education companies - CNBC. Yet, while APOL is up, overall options order flow on the ticker seems bearish -- 7,180 puts and 1,370 calls so far. November 27 puts, which are 26.4% OTM with a -.13 delta, are the most actives. More than 4,500 traded against 209 in open interest. Implied vols are moving up 1.5% to 32.5, even as the stock continues its recent run higher. APOL is up 12.8% since earnings were reported a week ago.

Unusual Volume Movers

Bullish flow detected in Qlik Technologies (QLIK), with 5591 calls trading, or 4x the recent average daily call volume in the name.

Bullish flow detected in Charles Schwab (SCHW), with 2663 calls trading, or 2x the recent average daily call volume in the name.

Bearish activity detected in Qihoo 360 Technology (QIHU), with 4215 puts trading, or 4x the recent average daily put volume in the name.

High options volume is being seen in Micron Technology (MU), Pfizer (PFE) and Best Buy (BBY).

Source: Monday Options Recap