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TEN Exclusive: Options Update – 11/14/10

|Includes:AIG, CREE, GS, JNPR, Oracle Corporation (ORCL), WYNN

It couldn’t last forever and this pat week the market finally ran out of gas and rolled over a bit.  September and October were tremendous for the bulls, but after we fought back above the 11,400 level, things quickly turned.

A combination of events overseas, some earnings misses, the G20 Summit and just overall market exhaustion were behind last week’s selling.

Looking at the SPX, we simply didn’t have the buying interest to push us convincingly above the 1225 level, and that level should be viewed as resistance.  During September and October we saw accumulation from funds and money managers and we need that accumulation to resume as we head look towards year-end.  We think that we will see a decent ramp-up to close out 2010.

This week is expiration for the November cycle but we don’t envision it to be a particularly volatile one.  However, if we see more selling pressure early in the week we could see a somewhat significant slide in the indices.  That will be dictated by news from overseas and the performance of the U.S. dollar.  We will be watching to see if the 1190 support level for the SPX holds up.

We go into this week with a neutral stance.

SPX Nov 14 2010

Weekly Economic Calendar:

Monday

  • The Commerce Department will report on October retail sales and September business inventories, while the Fed will release the Empire State Manufacturing Index for November. China Sunergy Co. Ltd. (CSUN), Diana Shipping Inc. (DSX), The Gymboree Corp. (GYMB), Lowe’s Companies Inc. (LOW), Nordstrom Inc. (JWN), and Urban Outfitters Inc. (URBN) will report earnings.

Tuesday

  • The producer price index for October is due from the Labor Department, while the Fed will report on industrial production in October. Meanwhile, the National Association of Home Builders will publish its Market Housing Index for November, a measure of builder confidence. Abercrombie & Fitch Inc. (ANF), ArvinMeritor Inc. (ARM), Dick’s Sporting Goods Inc. (DKS), The Home Depot Inc. (HD), Saks Incorporated (SKS), The TJX Companies Inc. (TJX), Wal-Mart Stores Inc. (WMT), and SINA Corporation (SINA) are scheduled to issue their quarterly reports.

Wednesday

  • The Labor Department will release the October consumer price index, while the Commerce Department will report on October housing starts. We’ll also get the usual weekly report on crude inventories. Scheduled to report earnings are BJ’s Wholesale Club Inc. (NYSE:BJ), Chico’s FAS Inc. (CHS), Suntech Power Holdings Co. Ltd. (STP), Target Corp. (TGT), VanceInfo Technologies Inc. (VIT), Applied Materials Inc. (AMAT), Aruba Networks Inc. (ARUN), Hot Topic Inc. (HOTT), Limited Brands Inc. (LTD), NetApp Inc. (NTAP), NetEase.com Inc. (NTES), and PetSmart Inc. (PETM).

Thursday

  • The weekly initial jobless claims report comes out on Thursday, along with the Conference Board’s leading indicators index for October and the Philadelphia Fed Index for November. American Eagle Outfitters (NYSE:AEO), Canadian Solar Inc. (CSIQ), Children’s Place Retail Stores Inc. (PLCE), Dollar Tree Inc. (DLTR), GameStop Corp. (GME), The J.M. Smucker Company (SJM), Sears Holdings Corporation (SHLD), Staples Inc. (SPLS), Autodesk Inc. (ADSK), Dell Inc. (DELL), The Gap Inc. (GPS), Intuit Inc. (INTU), Marvell Technology Group Ltd. (MRVL), and salesforce.com inc. (CRM) will report earnings.

Friday

  • There are no major economic reports scheduled for Friday. AnnTaylor Stores Corp. (ANN), H.J. Heinz Co. (HNZ), and Yingli Green Energy Holding Co. Ltd. (YGE) will report earnings.

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Stocks: ORCL, JNPR, GS, CREE, WYNN, AIG