Options Market Statistics: Nvidia Stock Is in a Correction, Dragging Artificial Intelligence Stocks Lower
News Highlights
$NVIDIA(NVDA.US$ shares ended 6.68% lower. Its options trading volume was 6.75 million. Call contracts account for 58.5% of the total trading volume.
Nvidia has shed more than $500bn in market value since briefly becoming the world's most valuable company last week, as its shares fell almost 7 per cent on Monday. Earlier last week, the company had leapfrogged Microsoft and Apple to become the most valuable publicly listed company in the world, though it has since fallen back to third place.
If Nvidia corrects pretty hard in the coming months it becomes very difficult for the $S&P 500 Index(.SPX.US$ to keep rising," said Barry Bannister, chief equity strategist at Stifel. "And Nvidia will decelerate," he added, referring to the company's hitherto strong earnings growth.
Monday's decline follows disclosures on Friday that the chipmaker's chief executive and co-founder, Jensen Huang, sold almost $95mn worth of shares in the days shortly before and after it became the world's most valuable company. The trades were part of a previously scheduled "rule 10b5-1" sale plan, which was set up in March, filings show.
$Meta Platforms(META.US$ shares ended 0.83% higher. Its options trading volume was 0.28 million. Call contracts account for 58.5% of the total trading volume. The $470 calls expiring August 16 were traded most actively.
iPhone maker $Apple(AAPL.US$ has held discussions with its big tech rival Meta Platforms to integrate the Facebook parent's generative artificial intelligence (AI) model into its recently announced personalized AI system, Apple Intelligence, The Wall Street Journal reported on Sunday.
Such a deal would allow Meta to leverage Apple's vast distribution of users through its iPhones, similar to how software companies gain exposure to millions of potential customers through the tech behemoth's App Store.
$Trump Media & Technology(DJT.US$ shares ended 21.19% higher. Its options trading volume was 0.25 million. Call contracts account for 58.5% of the total trading volume. The $30 calls expiring June 28 were traded most actively.
Shares of Trump Media soared more than 21% on Monday, as the firm majority-owned by former President Donald Trump sought to bounce back from a weekslong plunge that cut the stock price nearly in half.
Shares of Trump Media sunk even lower last week, after its registration of additional shares was declared effective by the Securities and Exchange Commission. The clearance threatened to dilute the stock price by adding more tradable shares to the company's float. The registration allowed early investors to resell certain shares and exercise previously issued warrants. Stock warrants give their holder the ability to buy shares at a predetermined price within a certain time frame. On Friday, Trump Media said it expected to rake in more than $69.4 million in proceeds from the warrants exercised on Thursday and Friday.
Meanwhile, Trump Media remains a risky, and pricey, company to sell short.
Unusual Stock Options Activity
There was a noteworthy activity in $Pfizer(PFE.US$, where multiple puts have topped volume to open interest ranking. The highest volume over open interest ratio reaches 81.7x with 15,857 contracts.
Daily Active Index & Sector ETF Options
Source: Barchart, Unusual Whales, The Guardian, Bloomberg
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