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Options Update – 5/19/10

 Stocks spent the session lower as concerns over the European sovereign debt continue to dominate the minds of investors.  The fear now is that eventually the weakness in the euro will hurt the profits of the many US corporations that do business internationally.  The one sector that was solid today was the financial sector.  This was due to the delay in passing the Financial Reform bill which is expected to eat into the profits of these firms.  Despite a tame round of inflationary data from the Labor Department, the Mortgage Bankers Association noted that the number of homes in foreclosure climbed to 4.63% during the first quarter.

The SPX managed to hold the 1100 level but we’re not sure for how long.  The concern over the euro situation isn’t going away overnight and eventually the Financial Reform Bill will pass.  We are short-term bearish but in this market you have to really pick your spots and remain nimble as volatility is high.

Options5.191

Weekly Economic Calendar:

Thursday

  • Weekly initial jobless claims hit the Street on Thursday, followed by April’s leading economic indicators and May’s Philadelphia Fed manufacturing index. Dollar Tree Inc. (NASDAQ:DLTR), GameStop Corp. (NYSE:GME), Ross Stores Inc. (NASDAQ:ROST), Staples Inc. (NASDAQ:SPLS), Tidewater Inc. (NYSE:TDW), Aeropostale Inc. (NYSE:ARO), Brocade Communications Systems Inc. (NASDAQ:BRCD), Dell Inc. (NASDAQ:DELL), salesforce.com inc. (NYSE:CRM), and Marvell Technology Group Ltd. (NASDAQ:MRVL) are scheduled to report earnings.

Friday

  • AnnTaylor Stores Corp. (NYSE:ANN) and Frontline Ltd. (NYSE:FRO) round out the week’s earnings reports.
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