Today's Options Market Update

Technology stocks can't catch a break this week despite robust earnings from chip giant Micron (MU). Though major indexes are modestly higher they are on pace for weekly losses. This suggests investors are rotating their money into sectors beyond tech, a potentially healthy development even as mega caps lose ground on worries about spiraling AI costs and a possible delay in OpenAI's initial public offering.

Today's calendar was relatively light, but investors digested the final University of Michigan Consumer Sentiment for June, which came below expectations, though inflation expectations remain unrevised but remained elevated. Meanwhile the May trade balance came in much wider than expected. July starts with a bang next week thanks to jobs data, including next Thursday's nonfarm payrolls report. Early forecasts suggest June jobs growth eased significantly from May's surprisingly robust 172,000.

Major indexes again went separate ways Thursday. The Nasdaq Composite dropped, the S&P 500 Index ended flat, and the Dow Jones Industrial Average and the Russell 2000® Index (RUT) gained. Six of 11 S&P 500 sectors rose, mirroring Wednesday's results with sectors like industrials and energy in the green. Health care has rallied amid some rotation into weaker areas. Some of Wall Street's softness could reflect consolidation after the spring rally. Funds may be trimming exposure to equities in a quarter-end rebalancing move.

Source: Schwab Center for Financial Research

The 10-year U.S. Treasury yield (TNX) is 2 basis points lower at 4.38%.

The U.S. Dollar Index ($DXY) is lower by 0.10 to 101.33.

WTI Crude Oil (/CL) is lower by 3.45% to $69.44/barrel.

Gold prices have traded in a range of $3,998.10-4,111.50 and were last seen trading higher by ~1.27% to $4,099.10/oz.

Natural Gas prices for June futures have traded in a range of $3.26-3.44 today and were last seen trading lower by 0.60% to $3.32.

Bitcoin (BTC) is higher by ~0.17% over the last 24 hours to $59,891399 today.

Shares of Acadia Pharmaceuticals Inc. (ACAD + $2.95 to $26.67) are gapping up this morning after the pharma company received a positive opinion from the European Union regarding its Rett syndrome treatment. Calls are outnumbering puts ~12:1 with the July 26th 25.00 call seeing the highest volume contract (volume is 171).

Also trading to the upside this morning is Infleqtion Inc. (INFQ + $0.92 to $13.71) after the technology company was initiated with an "Outperform" rating at Wedbush, which noted that it believes the company is uniquely positioned in the quantum technology market due to its broad portfolio and commercialization strategy. Calls are outpacing puts ~7:1 with the July 16th 15.00 call seeing the most action from traders (volume is 821).

New 52-week highs (122 new highs today): Abbvie Inc. (ABBV + $5.33 to $248.47), Anheuser-Busch Inbev S.A. ADR (BUD + $0.95 to $85.03), Johnson & Johnson (JNJ + $8.20 to $253.08)

Some unusual call activity (~100:1 calls over puts) is being seen in Rayonier Advanced Materials Inc. (RYAM - $0.01 to $7.92) as option traders primarily target the September 18th 10.00 call. Volume on this contract is 3,019 versus open interest of 171, so we know that the volume primarily represents fresh positioning. A major portion of the volume consisted of a 1,009-contract block that was bought at the ask price of $0.40, which suggests bullish intent.

Shares of On Semiconductor Corporation (ON - $25.19 to $93.55) are gapping down after the semiconductor supplier announced an agreement to acquire custom-designed human interface company Synaptics Inc (SYNA) in a deal worth $7.0 billion. ON makes chips for automotive and industrial markets. Calls and puts are roughly trading in line with each other with the August 21st 90.00 put garnering the most attention from traders (volume is 3,166).

Also trading to the downside this morning is Omeros Corporation (OMER - $1.93 to $8.79) after the European Union recommended the refusal of a marketing authorization for the biotech company's stem cell transplant drug. Calls are slightly outnumbering puts with the November 20th 12.00 call garnering the most attention from traders (volume is 1,010).

New 52-week lows (94 new lows today): Alibaba Group Holding ADR (BABA - $0.31 to $94.76), Coinbase Global Class A (COIN + $2.88 to $145.40), Stellantis N.V. (STLA - $0.03 to $5.71)

Some unusual put activity (~5:1 puts over calls) is being seen in Capricor Therapeutics Inc. (CAPR - $3.86 to $26.54) which is primarily being driven by activity on the August 21st 20.00 put. Volume on this contract is 5,734 versus open interest of one, so nearly all the volume represents fresh positioning. More than half of the volume consisted of a 2,900-contract block that was bought around the same time at the ask price of $5.50, which suggests bearish intent.

Baldwin Insurance Group Inc. (BWIN + $1.88 to $25.89): Option volume is running at 28x the daily average as option traders primarily target the July 17th 30.00 call. Volume on this contract is 3,065 versus open interest of 0, so all the volume represents fresh positioning (assuming no day trades). The bulk of the transactions consisted of various-sized blocks that were bought at various times for between $0.25-0.40 each, which suggests bullish intent.

MediaAlpha Inc. (MAX + $0.64 to $11.64): Option volume is running at ~24x the daily average on this marketing technology company as traders primarily target the November 20th 12.50 call volume on this contract is 1,021 versus open interest is six so we can assume we have fresh positioning here. Trading activity consisted of various-sized contracts trading around the same time at the ask price of $0.30, suggesting bullish intent.

Replimune Group Inc. (REPL + $0.03 to $11.16): Option volume is running at ~16x the daily average on this immunotherapy company which is primarily being driven by a 5,000-contract block that was bought on the August 21st 15.00 call at the ask price of $1.65 (open interest is 106). We know that this block is a new position based on the open interest figure and we can assume the intent is bullish in nature since the trade took place at the ask price.

The Cboe Volatility Index (VIX - 0.15 to 18.74) has been on both sides of the unchanged line today (the intraday range is 18.60-20.72), as equity markets are modestly higher around the midday mark (DJI + 58, SPX + 16, $COMP + 50). VIX option volume is well below average today at 182,267 contracts, and calls are outpacing puts ~2:1 so far today.