Big Picture

The FOMC didn’t offer up any surprises yesterday afternoon and the stock market reacted with a giant yawn.  VIX finally put in a new all-time intraday low hitting 8.84 as the FOMC announcement was just about to hit the tape.  Before the day was done VIX had worked its way up to 9.60.  The odds of a rate hike in December still remains at about 50%, but I’m taking the no hike side of that bet.  It will take very little in the form of negative news for the Fed to push out a hike or go on hold.

We get a GDP number on Friday morning and sentiment is for 2.7%, my guess is that estimate is going to be low as we have seen fairly positive earnings announcements this week.  GDP is measuring what the business conditions were like in the second quarter and earnings results we are just now getting are also from the same time period.

Overnight / Pre-Market

S&P 500 futures are up 5.00 points and VIX is once again hovering around the all-time low close at 9.33 (all time low is 9.31).   I spent a little time discussing the low VIX a couple of days ago. 

http://www.cboe.com/blogs/options-hub/2017/07/25/we-know-vix-is-low---the-why-and-what-may-be-next

We continue to get earnings announcements in early trading the following stocks are on the move:

Upside: 
ABX +2.4%, EW +3.0%, FB +4.1%, GILD +2.4%, GG +1.4%, LVS +1.8%,
PYPL +2.8%, NOW +1.3%, TSCO +1.8%, XLNX +3.4%, ALXN +2.6%, MT +1.7%,
BSX +3.6%, CELG +1.1%, CLF +3.5%, CMCSA +2.1%, GRUB +1.0%, KKR +1.0%, MGM +1.0%, NOK +4.0%, POT +3.0%, VZ +1.6%

Downside: 
DFS -2.6%, FFIV -8.2%, WLL -4.2%, TWTR -7.2%, AZN -15.7%, BMY -6.2%,

Note how many most stocks are on the upside versus the downside list.

Peter Lusk discussed a TWTR trade in front of earnings announcement on What’s Trading yesterday –

http://www.cboe.com/blogs/options-hub/2017/07/26/twitter-earnings-trending-$twtr-atm-straddle

Looking Forward

There are still several stocks reporting earnings.  Here’s the names for Today and Friday.

Thursday Friday Earnings

The full list of these stocks can be found at http://www.cboe.com/blogs/options-hub/2017/07/21/earnings-week-of-7-24-2017---7-28-2017

On Friday, before the market open, we get the first look at second quarter GDP.  The expectation is for 2.7% growth, but this is the first of three looks and may be a bit volatile.  With strong earnings reports I’m starting to wonder if that 2.7% number is a bit low.  We will know come Friday morning. 

CBOE Webcasts

August 2nd at 3:30 Central – Dan Passarelli discusses Tips and Tricks to Setting Up High Probability Option Trades

More information and registration at www.cboe.com/webcasts

Today in History

On this day in 2003 Bob Hope passed away at the age of 100.  This was an all around good guy who would travel the world performing for troops stationed in places none of us would want to go.  My Uncle accompanied him on a couple of these journeys and noted he was as nice in private as he was in public.  Many of you are not old enough to remember when Bob Hope specials would come on TV, but it was basically a time where children were to be neither seen nor heard as the generation before us wanted to catch every moment up to him thanking us for the memories. 

Bob HOpe