News may be sparse on Wall Street, but that didn't stop the takeover and deal-making rumor mill from operating at full blast.
"The main problem is that no one wants to take any major positions before the
numbers on Thursday," said Kyle Rosen of
Rosen Capital Management
. He's looking for the
index to break out of a "very narrow range" based on the data. "If we head above 1407-1408, I'm going long. If below 1385, I'm going short, assuming it's not a head fake."
And while waiting for the CPI numbers prompts different moves, there was some old-fashioned, all-American call-buying in otherwise quiet utility
in the past few trading sessions amid chatter that it would spin off its telecommunications operations.
, Montana Power is a utility operating electric and natural gas systems. Its subsidiaries include telecommunications unit,
, which provides long-distance services, Internet and business telephone equipment in the upper Midwest and Western states.
"That hit some chat room board, that we're in the process of spinning it off," said spokeswoman Linda McGillen. "But that's not true. No decisions have been made. We have gotten a lot of calls since we announced our stock split, and we're planning an investor meeting here in Montana July 28 and 29," she added. "That's gotten a lot of response as well."
With the stock up 3/4 to 69 1/8 at midday, the August 70 calls gained 3/4 ($75) to 3 3/4 ($375) and August 75 calls gained 1/4 ($25) to 2 ($200).
call-buying wouldn't let up either, as takeover rumors also stuck to that stock. A spike in implied volatility, around 90 to 92 in the July call options and 87 to 88 in the August call options from typical 70-ish levels, lent some more legitimacy to what has been vague chatter. A rise in volatility typically indicates the market is pricing in some sort of news or event.
With the stock up 15/16 to 20 7/16, the company's August 20 calls, which would give the holder the right to buy the stock for $20 a share next month, traded more than 500 contracts and increased 7/8 ($87.50) to 3 ($300).
The price of
call options continues to grow richer.
Its August 45 calls were up 1 ($100) to 3 3/4 ($375), and the slightly out-of-the-money August 50 calls were up 7/16 ($$43.75) to 1 1/4 ($125) on volume of over 2,000 contracts.
In late June
options activity, Boeing's August 45 calls were rising 13/16 ($81.25) to 2 ($200) and the stock was trading at 44 1/6. Today the stock was up 1 1/6 to 47 3/8.