China’s trade balance report for September showed a 9.9% increase in exports. In the U.S., total retail sales jumped 1.1% on top of an upwardly revised 1.2% increase (from 0.9%) in August. The consensus expectation was 0.7%. Excluding autos, retail sales rose 1.1% versus an upwardly revised 1.0% increase (from 0.8%) in August. European stocks and our futures are up this morning.
Dolby Laboratories (DLB) is trading near its lows. On Friday, there was an opening buyer of 2800 Mar 35 calls. This is 11x normal volume. After outperforming all year long, technology stocks are leading on the way down currently. On average, technology stocks earn 53.7% of their revenues from abroad versus the average company having only 29.8% of their sales come from international sources. RF Micro Devices (RFMD) is trading near 52 week lows. On Friday, there was a buyer of 3,000 Nov 4 calls. Earnings are scheduled for October 23.
Overall, market makers continue to maintain a bullish bias in their net delta exposure to the S&P 500. Put option buying measured through the VIX remains subdued. Our market sentiment indicator which has weakened over the past three weeks remains bullish.