U.S. stocks ended solidly higher on Wednesday (July 12th), led by a gain of more than 1% in the Nasdaq after a report showed inflation subsided further with consumer prices registering their smallest annual increase in more than two years.
Regarding the options market, a total volume of 42,981,414 contracts was traded, up 21.4% from the previous trading day.
Nvidia shares rose 3.5% after people familiar with the matter said SoftBank Group Corp's chip designer Arm Ltd is in talks to bring in Nvidia as an anchor investor as it presses ahead with plans for a New York listing that could happen in September.
Nvidia is already an Arm customer but its talks to invest in the company point to bigger ambitions to expand from its core business in “graphics processing units” — dedicated chips for accelerating specialised tasks, including 3D rendering and training artificial intelligence — into the “central processing units” that handle most other computing functions.
A total number of 1.07 million options related to Nvidia was traded, up 116.8% from the previous trading day. A particularly high trading volume was seen for the $440 strike call options, with a total number of 85,637 option contracts traded as of Wednesday. $NVDA 20230714 440.0 CALL$
Also, Nvidia said it will invest $50 million to speed up training of Recursion's artificial intelligence models for drug discovery. Recursion shares were up 78%.
Trading volume related to Recursion was not quite active. A total number of 35,789 options related to Recursion was traded, of which call options accounted for 57%. A particularly high trading volume was seen for the $12.5 strike call options, with a total number of 7,890 option contracts traded as of Wednesday. $RXRX 20230721 12.5 CALL$
Most Active Equity Options
Special %Calls >70%: Nio; Alibaba; Amazon; Lucid; Alphabet
A total number of 556,362 options related to Alibaba was traded, of which call options accounted for 82%. A particularly high trading volume was seen for the $100 strike call options expiring July 21. $BABA 20230721 100.0 CALL$
Unusual Options Activity
Lucid Group Inc crashed over 11.8% on Wednesday. Lucid Group said its electric-vehicle deliveries were flat in the second quarter compared with the previous one amid stiff competition from market leader Tesla.
The company delivered 1,404 vehicles in the quarter ended June 30, compared with 1,406 deliveries in the first quarter.It made 2,173 vehicles during the quarter compared with 2,314 units in the previous three months.
A total number of 87,249 options related to Lucid was traded, of which call options accounted for 74%. A particularly high trading volume was seen for the $7 strike put options expiring July 14, with a total number of 16.71K option contracts trading on Wednesday.
Investors are fascinated with meme stocks again as they hunt through lower-quality names searching for returns. Only three of the 25 meme index members have slumped since Thursday, while big gains for Carvana Co., Riot Platforms, and Rivian have led the way.
TOP Bullish & Bearish Single Stocks
This report shows stocks with the highest volume of bullish and bearish activity by option delta volume, which converts option volume to an equivalent stock volume (bought or sold).
If we take the total positive option delta volume and subtract the total negative option delta volume, we will get the net imbalance. If the net imbalance is positive, there is more bullish pressure. If the net is negative, there is more bearish pressure.
Top 10 bullish stocks: MULN; NVDA; CVNA; DKNG; QS; BYND; CGC; TOST; WBD; FUBO
Top 10 bearish stocks: AAPL; AMC; TSLA; NKLA; AMZN; ATVI; SOFI; BAC; MARA
Based on option delta volume, traders bought a net equivalent of 1,400,861 shares of Mullen stock. The largest bullish delta came from buying calls. The largest delta volume came from the 17-Jan-25 0.5 Call, with traders getting long 855,337 deltas on the single option contract. $MULN 20250117 0.5 CALL$
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