Today's Options Market Update

Stocks Overlook Soft Jobs Data and Push Higher on Trump-Xi Call

June 5, 2025 Nathan Peterson

Stocks brush off weak Initial Claims data and instead focus on trade progress between the U.S. and China.

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Earnings from AI giant Broadcom (AVGO) loom after the close before Friday's May jobs report, but first investors mull a sprinkling of fresh labor updates. Employers cut less than 94,000 jobs last month, according to the Challenger job cuts report, down about 11,000 from April, but layoffs soared in the services sector. Meanwhile, initial weekly jobless claims edged up for the second straight week to 247,000, an eight-month high. Major indexes fell after the data but climbed after media reports of a call between U.S. President Trump and China's President Xi. "The rise in initial claims suggests some softening in the labor market," said Cooper Howard, director, fixed income strategy, at the Schwab Center for Financial Research.

Yesterday saw how quickly stocks can be swayed by jobs data, as ADP's private sector jobs report disappointed with only 37,000 positions added in May, the lowest in more than two years. Major indexes ended mixed, retreating from an early rally. Treasury yields skidded to three-week lows below 4.4% for the 10-year note Wednesday and now trade under 4.35% after soft May services data and today's claims reinforced growth worries. Trump leaned publicly on Federal Reserve Chairman Jerome Powell to cut rates, but Trump's tariff policy has the Fed concerned about possible resurging inflation.

While CNBC reported this morning that Trump and Xi spoke by phone, citing Chinese media reports, the market seems less bothered by the daily din. "Uncertainty is likely to extend over a longer period for businesses and consumers, but investors may be adapting," said Michelle Gibley, director of international research at the Schwab Center for Financial Research. "We're seeing smaller and smaller reactions by markets. It appears investors may be becoming desensitized to tariff news. As the year progresses, taking a longer-term view, investors may increasingly look toward potential deals and more certainty."

Source: Schwab Center for Financial Research

Morning Rush

The 10-year U.S. Treasury yield (TNX) is higher by ~2 basis points to 4.389%.

The U.S. Dollar Index ($DXY) is lower by 0.05 to 98.74.

WTI Crude Oil (/CL) is higher by 1.00% to $63.48/barrel.

Gold prices have traded in a range of $3,383.30-$3,427.70, last seen trading lower by 0.39% to $3,386.10/oz.

Natural Gas prices have traded in a range of $3.62-3.791 and were last seen trading lower by 1.75% to $3.651.

Bitcoin (BTC) is higher by ~0.21% today to $104,967.10.

Today's Bullish Activity

Leading the point gainers list this morning is MongoDB Inc. (MDB + $30.62 to $230.35) after the database software maker reported Q1 earnings of $1.00 per share ($0.34 beat) on revenue that rose 21.8% year-over-year (YoY) to $549M (above the $528.12M FactSet consensus estimate) as Q1 subscription revenue increased 22% YoY. Looking ahead, the company said that Q2 EPS is expected to be $0.62-0.66 (above the $0.59 FactSet consensus estimate) with Q2 revenue expected to come in a range of $548-553M (vs. the $549.93M FactSet consensus estimate). Calls are outnumbering puts ~2:1 with the June 6^th 250.00 call being the highest volume contract (volume is 10,509).

Also trading to the upside this morning is Five Below Inc. (FIVE + $10.15 to $131.39) after the discount retailer reported Q1 earnings of $0.86 per share, excluding non-recurring items ($0.03 beat) on revenue that rose 19.5% year-over-year (YoY) to $970.53M (above the $966.52M FactSet consensus estimate) as Q1 same-store sales that increased 7.1% year-over-year (above prior guidance of +6.7%). Looking ahead, the company said that Q2 EPS is expected to come in a range of $0.50-0.62 (vs. the $0.54 FactSet consensus estimate) with Q2 revenue expected to come in a range of $975-995M (above the $954.65M FactSet consensus estimate). Calls are outnumbering puts ~3:2 with the September 19^th 160.00 call seeing the most action from traders (volume is 1,531).

New 52-week highs (101 new highs today): Booking Holdings Ltd. (BKNG + $54.60 to $5,611.60), Intuit Inc. (INTU + $5.72 to $772.53), Netflix Inc. (NFLX + $17.74 to $1,257.40)

Notable Call Activity

Some unusual call activity (~5:1 calls over puts) is being seen in AI infrastructure firm Nebius Group N.V. (NBIS + $9.72 to $49.11) as all of the top 10 highest volume contracts are calls today. Topping the list is the June 20^th 50.00 call as volume is 21,201 versus open interest of 7,099, so we know that the volume primarily represents fresh positioning. The bulk of the activity consisted of various-sized blocks that were bought at various times for between $1.10-$3.30 each, which suggests bullish intent.

Today's Bearish Activity

Shares of PVH Corp. (PVH - $14.69 to $66.12) are gapping down this morning after the retailer beat quarterly estimates but issued downbeat guidance earlier this morning. The company reported Q1 adjusted earnings of $2.30 per share ($0.06 beat) on revenue that rose 2.0% year-over-year (YoY) to $1.98B (above the $1.94B FactSet expected). Regarding guidance, the company lowered its full-year EPS guidance to a range of $10.75-11.00 from $12.40-12.75, citing the impact of tariffs. Calls are outnumbering puts ~4:3 with the June 20^th 70.00 call being the highest volume contract (volume is 2,502).

Also trading to the downside this morning is Ciena Corp. (CIEN - $9.54 to $74.35) after the networking company reported Q1 adjusted earnings of $0.42 per share ($0.10 miss) on revenue that rose 24% year-over-year (YoY) to $1.13B (above the $1.09B FactSet expected). The company's gross margin fell to 40.2% from 42.7% versus the year-ago quarter. Calls are outnumbering puts ~5:4, but the June 20^th 80.00 put is the highest volume contract (volume is 1,664).

New 52-week lows (22 new lows today): Brown Forman Inc. – Class A (BF.A - $5.76 to $27.37), Clorox Co. (CLX - $2.21 to $127.44), Regeneron Pharmaceuticals Inc. (REGN + $3.44 to $488.37)

Notable Put Activity

Some unusual put activity (~34:1 puts over calls) is being seen in WEC Energy Group Inc. (WEC - $0.17 to $105.56) which is primarily being driven by activity on the June 20^th100.00 put. Volume on this contract is 2,457 versus open interest of 182, so we know that the activity primarily represents new positioning. The bulk of the activity consisted of various-sized blocks that were bought at various times for between $0.65-0.70 each, which suggests bearish intent.

Volume Signals

Turtle Beach Corp. (TBCH + $0.85 to $13.05): Option volume is running at ~735x the daily average on this audio technology company as option traders primarily target the July 18^th 15.00 call. Volume on this contract is 9,415 versus open interest of 4,003, so we know that the volume primarily represents fresh positioning. The bulk of the activity consisted of various-sized blocks that were bought at various times for between $0.40-0.70 each, which suggests bullish intent.

DigitalOcean Holdings Inc. (DOCN - $1.74 to $28.13): Option volume is running at ~24x the daily average on this cloud computing platform as option traders primarily target the November 21^st25.00 put. Volume on this contract is 7,145 versus open interest of 189, so it's likely that nearly all the activity represents fresh positioning. The bulk of the transactions consisted of various-sized blocks that were bought at various times for $3.00 each when the bid/ask spread was $2.05 x $3.10, which suggests bearish intent.

Dover Corp. (DOV + $0.39 to $178.05): Option volume is running at ~23x the daily average on this provider of equipment, components and consumable supplies which is primarily being driven by activity on the August 15^th 190.00 call. Volume on this contract is 1,655 versus open interest of zero, so we know that all the volume represents new positioning (assuming no day trades). The bulk of the activity consisted of various-sized blocks that were bought around the same time at the ask price of $4.40 each, which suggests bullish intent.

Gauging Volatility

The Cboe Volatility Index (VIX - 0.36 to 17.25) has been on both sides of the unchanged line today (intraday range is 17.08-18.16), as equity markets are higher around the midday mark (DJI + 92, SPX + 7, COMP + 25). VIX option volume is below average today as the index is currently missing from the "Top Volume by Underlying" list. The volume put/call ratio is currently 0.50 with the highest volume contract being the July 16^th 25.00 call (volume is 36,572 vs. open interest of 88,794).

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