By Brendan Conway
For once, the contrarian Apple (AAPL) trade is to be bullish. With hours to
go until the iPad maker’s quarterly earnings report, the stock is down 2.1%
at $559.72. But here’s an even more vivid sign. The PowerShares QQQ‘s (
QQQ) equity options are the most bearish-looking in nearly six years, says
Dow Jones Newswires’ Kaitlyn Kiernan:
Worries about a postearnings Apple (AAPL) slump is spreading. Options
activity in the PowerShares QQQ (QQQ) ETF, which tracks the Nasdaq 100, hits
the most-bearish level in nearly five years ahead of AAPL’s F2Q report.
The put-call ratio has jumped to 6.4-1, the highest level since July 2006,
when the measure hit 6.9-1. The options market is currently pricing in a 7%
postearnings swing in APPL, which currently accounts for about 20% of the
index’s weight.The most actively traded QQQ options contract?May $60 puts?
would profits if the ETF slips 7.6% by May 19.
Surely some of that activity reflects the more defensive tone in markets the
last few weeks, but don’t discount Apple’s role. Recall that the stock
makes up 18% of the Qs’ exposure these days and is a major factor in how
the ETF trades. The Qs track the Nasdaq 100, the index of the biggest non-
financial stocks on the tech-heavy exchange.
As usual, most analysts don’t appear to share such Apple jitters. “We are
expecting the company to beat consensus, which is already significantly
above management’s guidance. The upside to the quarter’s results will be
primarily driven by iPhones,” Mizuho Securities’ Abhey Lamba and Dunham
Winoto wrote this morning
