Softee Rebound Gives Bulls an Escape Route - TheStreet

Softee Rebound Gives Bulls an Escape Route

The latest twist in the Microsoft case drives the stock up and has earlier call-buyers taking profit.
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Trading in

Microsoft

(MSFT) - Get Report

options was heavy Tuesday as investors cheered news that the conduct remedies against the company have been stayed while Microsoft appeals the judge's ruling.

One trader at a big Wall Street firm said investors were closing out long call positions in Microsoft to take some profits.

The trader pointed out that many big blocks changed hands and investors who had bought calls early in the Softee travails were seeing today's run-up as a good time to get out. On Wednesday morning,

CIBC World Markets

upgraded shares of Microsoft to buy from hold.

On

Tuesday, Judge Thomas Penfield Jackson granted the software giant's request to stay the conduct remedies he ordered against the company. The judge also sent Microsoft's appeal directly to the

U.S. Supreme Court

, bypassing the federal appeals court. Earlier this year, the judge ruled that Microsoft was a predatory monopolist and that it had violated antitrust law.

Late last month, shares of Microsoft traded down as much as low as 60 3/8. Investors who bought call options on Microsoft with a strike of 60 are looking rather prescient, considering how much the value of the options have appreciated since then.

Shares of Microsoft were trading up 4 1/4 to 79 3/16. Some of the heaviest options trading has been seen in the July 60 calls, with almost 11,000 contracts changing hands on the

Pacific Exchange

. The calls were up 3 7/8 ($387.5) to 19 3/8 ($1,937.50). The July 75 calls were also seeing heavy action on the West Coast, with about 14,300 contracts trading. The calls were up 3 ($300) to 6 1/4 ($625).

But with a good number of people closing out their long call positions, it doesn't appear they think that there's much upside juice left in shares of Microsoft for the time being.

It's getting a bit pricey to buy a seat at the

American Stock Exchange

. A regular seat at the Amex earlier this week traded for a record $725,000, up from $700,000 on June 1 and May 24.

Elsewhere in exchange-related news, the

International Securities Exchange

continues to expand its listings. After starting out with just three listings, it has expanded to a total of 12:

Abbott Laboratories

(ABT) - Get Report

,

Alcoa

(AA) - Get Report

,

Gillette

(G) - Get Report

,

General Motors

(GM) - Get Report

,

Kimberly-Clark

(KMB) - Get Report

,

Coca-Cola

(KO) - Get Report

,

LSI Logic

(LSI) - Get Report

,

Mattel

(MAT) - Get Report

,

PsiNet

(PSIX)

,

SBC Communications

(SBC)

,

Unisys

(UIS) - Get Report

, and

Weatherford International

(WFT) - Get Report

.