Today's Options Market Update

Wall Street's positive vibes came under threat Friday from a 35% tariff imposed on imports from Canada. Major indexes fell broadly in early trading and Treasury yields ticked up amid concerns tariffs could raise prices and weigh on growth prospects. The tariffs begin August 1 and follow President Trump's 50% tariff on Brazil announced earlier this week that might force up costs of items like coffee, orange juice, and beef.

Market participants also remain on edge about a possible tariff announcement on European Union imports possible later today and the prospect of rising prices for industrial products as the result of Trump's 50% tariff on copper imports. And nerves spiked ahead of next week's crowded schedule that includes earnings from large banks and June inflation data.

Major indexes finished at fresh record highs yesterday despite tech losing some traction in a broad rally helped by shares of travel industry stocks after Delta Air Lines (DAL) shared a positive outlook.

Source: Schwab Center for Financial Research

The 10-year U.S. Treasury yield (TNX) is 7 basis points higher at 4.42%.

The U.S. Dollar Index ($DXY) is higher by 0.18 to 97.83.

WTI Crude Oil (/CL) is higher by 2.75% to $68.40/barrel.

Gold prices have traded in a range of $3,332.30-$3,381.60, last seen trading higher by 1.16% to $3,364.20/oz.

Natural Gas prices have traded in a range of $3.35-3.44 and were last seen trading higher by 0.62% to $3.39.

Bitcoin (BTC) is gaining ground and was last seen higher by ~1.41%, at $117,526.00.

Gapping higher this morning is Levi Strauss & Co. (LEVI + $1.61 to $21.34) after the apparel company reported fiscal-year Q2 earnings-per-share of $0.22 (excluding non-recurring items), compared to the FactSet consensus estimate of $0.13. Revenue rose 6.0% year-over-year (y/y) to $1.45 billion, topping analysts' estimates of $1.37 billion. LEVI's organic revenue—excluding acquisition, divestitures, and foreign exchange—increased 9% globally. The company also increased its quarterly dividend by 7.7% and raised its full-year guidance assuming U.S. tariffs on imports from China remain at 30% and 10% for the rest of the world. Calls are outnumbering puts ~2:1 with the July 18th 21.00 call seeing the most action from traders (volume is 5,165).

Also trading to the upside this morning is Red Cat Holdings Inc. (RCAT + $1.06 to $7.84) after the drone technology company shares were boosted by the announcement from Defense Secretary Hegseth issuing orders to fast-track drone production and development, rescinding previous policies. Calls are outnumbering puts ~7:1 with the July 18th 8.00 call seeing the most action from traders (volume is 4,499).

New 52-week highs (86 new highs today): Coinbase Global Inc. (COIN + $3.45 to $392.41), Dollar Tree Inc. (DLTR + $0.68 to $109.05), Nvidia Corp. (NVDA + $2.10 to $166.20)

Some unusual call activity (~5:1 calls over puts) is being seen in Unusual Machines Inc. (UMAC + $3.37 to $12.06) driven by activity on the July 19th 12.50.00 call for this drone manufacturer. Volume is 5,824 versus open interest of 1,504, so it's likely we have some fresh positioning here. The bulk of the activity consisted of multiple various-sized blocks that were bought at various times at the ask price of $0.40 each, which suggests bullish intent. 

Gapping down this morning is Capricor Therapeutics Inc. (CAPR - $3.29 to $8.11) after the Food & Drug Administration (FDA) denied approval of the biotech company's muscular dystrophy treatment in its current form, saying the application did not meet the statutory requirement for substantial evidence of effectiveness. Calls are slightly outnumbering puts, but the September 19th 7.50 put is seeing the most action from traders (volume is 6,690).

Also seeing pressure this morning is Boyd Gaming Corporation (BYD - $6.09 to $79.28) after analyst Joseph Stauff at Susquehanna downgraded the gaming company to "Neutral" from "Positive." The downgrade followed late-yesterday's announcement from BYD that it will sell its 5% ownership stake in FanDuel to Flutter Entertainment PLC (FLUT) for $1.76 billion. Calls are outnumbering puts ~17:1, with the September 19th 87.50 call seeing the most action from traders (volume is 2,474).

New 52-week lows (34 new lows today): CNA Financial Corp. (CNA - $0.13 to $43.81), Fidelity National Financial (FNF - $0.16 to $51.06), Progress Software (PRGS - $1.15 to $49.49)

Some unusual put activity (~23:1 puts over calls) is being seen in Xylem Inc. (XYL - $0.75 to $130.85) which is primarily being driven by activity on the August 15th 120.00 put for this water technology company. Volume on this contract is 1,438 versus open interest of zero, so we know all of this activity represents fresh positioning. The volume was driven by a 1,430-contract block that traded at $0.80 when the bid/ask spread was $0.05 x $2.60, suggesting neutral to bullish intent since the trade took place below the midpoint.

Confluent Inc. (CFLT - $0.01 to $24.50): Option volume is running at ~17x the daily average on this American technology company which is primarily being driven activity on the August 15th 27.00 call. Volume is 10,151 versus open interest of 890, so we know that the activity mostly consists of fresh positioning. The bulk of the volume consisted of a 10,000 contract block that was bought at the ask price of $1.50, which suggests bullish intent.

Applied Optoelectronics Inc. (AAOI + $0.26 to $28.51): Option volume is running at ~10x the daily average on this fiber optics company with the bulk of activity focused on the July 18th 24.00 put. Volume on this contract is 9,152 versus open interest of 50. We know we have fresh positioning here based on the open interest figure, and the activity was primarily driven by an 8,880-contract block that was bought at the ask price of $0.35, suggesting bullish intent.

Eldorado Gold Corporation (EGO + $0.51 to $20.45): Option volume is running at ~9x the daily average on this gold mining company which is primarily being driven by activity on the October 17th 15.00 call. Volume on this contract is 1,001 versus open interest of 15, so we know we have fresh positioning here. The bulk of the activity consisted of a 1,000-contract block that was bought at $5.65 when the bid/ask spread was $5.40 x $5.70, suggesting bullish intent since the trade took place above the midpoint of the bid/ask spread.

The Cboe Volatility Index (VIX + 0.53 to 16.31) has been in positive territory all day (intraday range is 16.28-17.24), as equity markets are mostly lower around the midday mark (DJI - 297, SPX - 17, COMPX + 4). VIX option volume is below average today as the index is missing from the "Top Volume by Underlying" list. The volume put/call ratio is currently 0.93, with the July 16th 16.00 put the highest volume contract (volume is 36,375).