STOCKS NEWS US-Intel pares gains after news of lawsuit

Stocks on the move Real-time Equity news U.S. stock market report 1136 ET 04Nov2009 Intel pares gains after news of lawsuit ------------------------------------------------------------------------------ Shares of Intel Corp pared gains after the New York attorney general's office filed an antitrust lawsuit against the company, alleging Intel used payoffs, coercion and retribution to maintain monopoly power in microprocessors. Shares were last up 1.8 percent at $18.69. For more please double click Reuters Messaging rm://[e-mail] 1119 ET 04Nov2009 Goldman Sachs suggests Gap calls ahead of retail sales,earns ------------------------------------------------------------------------------ Gap Inc call options look attractive to capture improving retail sales comps and Nov. 19 earnings, wrote Goldman Sachs derivative strategists in a note. They suggest buying calls given the high put skew and history of large stock moves on same-store sales data. Many top retail chains will report October sales results on Thursday. Goldman's retail analyst Michelle Tan believes sales comparisons in the report could be above consensus due to recent traffic-driving promotions. Option prices are attractive; Gap's one-month implied volatility is in its bottom quartile, below its one-year average versus the S&P 500, and relatively in-line with discretionary peers. Historically, Gap tends to move plus/minus 4 percent on sales data issued in November. Its options are implying a 7 percent swing on earnings. With shares at $21.94, Goldman recommends buying November $22 calls for 90 cents, a strategy that breaks-even if shares rise 4.3 percent. Reuters Messaging: [e-mail] 1109 EST 04Nov2009-American Capital rallies after credit agreement ------------------------------------------------------------------------------ Shares of American Capital advanced on Wednesday, a day after the company agreed with lenders to restructure its debt. The company will also pledge substantially all its assets as collateral. For details, see The stock gained 15 percent to $3.12. Reuters Messaging: [e-mail] 1039 EST 04Nov2009-S&P 500 usually ends higher on rate decision days-Birinyi ------------------------------------------------------------------------------ The S&P 500 usually closed higher during the Fed rate decision days in 2008 and 2009, as the index rose on the day 71 percent of the time for an average gain of 1.5 percent, market research firm Birinyi Associates Inc said in a note to clients. But the index usually exercised caution after the decision was announced, usually from between 2 p.m. and market close. The market fell 57 percent of the time after the announcement and most notably during the last four rate decision days, the note said. The Federal Open Market Committee statement is due at about 2:15 p.m. EST (1915 GMT) and marks the seventh this year. The last time rates were adjusted was on Dec. 18, 2008 when the FRB moved the fed funds rate to a range of 0 to 25 bps. As has been the case for the last six meetings, analysts expect the Fed to keep rates steady this time, while reaffirming that policies to support the economy will stay in place for some time, even as signs of recovery mount. Reuters Messaging: [e-mail] 1026 ET 04Nov2009 Players favor Aetna call options ------------------------------------------------------------------------------ A number of option players appear to be taking bullish positions on Aetna Inc by buying front-month November call options. Its shares jumped more than nearly 8 percent to $28.72 in morning trade. Players populated the November $29 call strikes, where 5,000 contracts earlier traded. It looked like speculative call buyers are opening positions, as 62 percent of the volume traded ask-side and contracts outstanding is 1,817, said WhatsTrading.com option strategist Frederic Ruffy. But Ruffy also noted that 50,000 January 2010 calls at the $40 line were sold for an average premium of 12.5 cents each. The strike's open interest is 55,000 and the action might be a closing position accumulated in early July when Aetna traded between $24 and $26 per share, he said. In all, about 68,000 calls crossed the tape compared to 1,748 puts, according to Trade Alert. There was no apparent catalyst to explain the call action. Reuters Messaging: [e-mail] Keywords: MARKETS STOCKSNEWS COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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