STOCKS NEWS US-High yield bond ETF gets bearish position

Real-time equity news U.S. stock market report 1234 ET 12Nov2010 High yield bond ETF gets bearish position- analyst ------------------------------------------------------------------------------ Bonds have been showing signs of weakness, and one investor is nervous about the most volatile part of that market, wrote optionMonster analyst David Russell on the firm's website. The firm's tracking system detected the purchase of 2,000 March $37 puts on the SPDR Barclays Capital High Yield Bond fund. The transaction priced for 65 cents, was matched against the sale of an equal number of March $35 puts for 30 cents. Volume was more than triple open interest in both strikes. The bearish put spread cost 35 cents and will earn a maximum profit of about 470 percent if the fund closes at or below $35 on expiration. The exchange-traded fund, which tracks junk bonds, fell 0.1 percent to $40.40, down from a two-year high of $41.32 set on Nov. 4. "Junk bonds have been falling along with Treasuries following a long rally that took place as investors positioned for the Federal Reserve to flood the economy with cheap money," Russell said. But recent trading patterns suggest bond prices may be done rising, he said. The iShares Lehman 7-10 Year Treasury Bond fund is apparently hitting resistance around the same level where it peaked in late 2008. The yield on the 10-year note is showing signs of bottoming, which also would correspond to a top in prices, he said. Reuters Messaging: 1126 ET 12Nov2010 Fairchild Semiconductor puts draw interest ------------------------------------------------------------------------------ Investors have been looking at Fairchild Semiconductor International's put options following an upgrade from Citigroup, traders said. The shares rose 1.57 percent to $12.29 in morning trade after Citigroup raised its recommendation on the stock to "buy" from "hold," said optionMonster analyst David Russell. Some 4,300 December $11 strike puts and 1,200 December $12 puts were purchased, said Patrick Mortimer, director of option trading at Pipeline Trading Systems. Almost all of this trading is opening positions and has pushed the stock's volume to seven times its daily contract average earlier in the session, he added. Also of note is that Friday's volume accounts for nearly 50 percent of the company's total option open interest. With Fairchild setting a new year high of $12.80 on Monday, the activity looks like an investor is looking for the shares to pull back over the next five weeks or protecting a long equity position after the recent rally, he said. Reuters Messaging: 1011 EST 12Nov2010-Intel raises dividend by 15 pct ------------------------------------------------------------------------------ Intel Corp's board approved a 15 percent increase in its quarterly dividend to 18 cents a share, the company said on Friday. For details, see Shares of Intel, a Dow component, rose 2.3 percent to $21.70. Reuters Messaging: 1007 EST 12Nov2010-Consumer sentiment rises in early November ------------------------------------------------------------------------------ U.S. consumer sentiment rose more than expected in early November, helped by a slightly better economic outlook and early holiday sales, a survey released on Friday showed. The Thomson Reuters/University of Michigan's preliminary November reading on the overall index on consumer sentiment came in at 69.3, up from 67.7 in October and slightly higher than the median forecast of 69.0 among economists polled by Reuters. For details, see Reuters Messaging: Keywords: MARKETS STOCKSNEWS Editing by Andrew Hay Keywords: MARKETS STOCKSNEWS COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.

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