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Semiconductor industry

Market Analysis: Stocks on the Move

Strategic Insights

— 1 min read

Microsoft (NASDAQ:MSFT), Intel (NASDAQ:INTC), Yahoo! (NASDAQ:YHOO), Reynolds American (NYSE:RAI), and Masco (NYSE:MAS) have been attracting significant attention in the market, with trade volumes and sentiment analysis pointing to possible short-term support and long-term trends.

Microsoft has been on a tear, Intel has been treading water, and Yahoo! has faced a weaker-than-expected fundamental outlook, leading to increased call option volume on the three stocks. This optimism could act to support the shares in the short term, but may hold them back from seeing extended gains from current levels. Meanwhile, Reynolds American has dropped over five percent on a brokerage downgrade, with short interest being a force to be reckoned with. However, the stock continues to hover above its 10-month moving average and remains in a solid long-term uptrend. Masco, on the other hand, has reduced its earnings forecast for the year due to a continued slowdown in housing starts, leading to a decline in its stock price and dragging down other homebuilding names.

Key Takeaways:

  • Microsoft, Intel, and Yahoo! have seen significant call option volume, indicating optimism among options traders.
  • Reynolds American has been downgraded by Citigroup, but continues to show resilience above its 10-month moving average.
  • Masco has reduced its earnings forecast due to a slowdown in housing starts, leading to a decline in its stock price.
  • Short interest in Reynolds American is a significant factor, with nearly 20 trading days required to eradicate all shorted positions.
  • The ISE Homebuilders Index has dropped over one percent and is clinging to its 20-week trendline.
  • Microsoft, Intel, and Yahoo! have been acting differently of late, but the implications for the three could be similar.

Statistics:

  • Call option volume on Microsoft (NASDAQ:MSFT) has been over three times put volume today.
  • Masco (NYSE:MAS) has dropped over two percent today on above-average volume.
  • Reynolds American (NYSE:RAI) has over 20 trading days' worth of short interest at the stock's average daily volume.
  • The ISE Homebuilders Index (RUF) has dropped over one percent today and is clinging to its 20-week trendline.
  • Microsoft (NASDAQ:MSFT) has seen a 10% increase in price over the past month.

Sources:

  • Schaeffer's Market Blog (September 20 edition)
  • Schaeffer's Investment Research (www.SchaeffersResearch.com)
  • NASDAQ (www.nasdaq.com)
  • NYSE (www.nyse.com)

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