Daily Options Outlook | Intel up 4.05% in pre-market trading as Q2 earnings beat expectations; Oracle secures long-term government contract

Preview of Today's Options Opportunities

On the macro front,$Invesco QQQ Trust (QQQ.US)$Up 0.06% in pre-market trading,$SPDR S&P 500 ETF (SPY.US)$Up 0.22% in pre-market trading, Tesla and Alphabet (Google's parent) plummeted due to significantly increased AI investment spending turning free cash flow negative, sparking market concerns over excessive AI spending by tech giants. Escalating U.S.-Iran tensions pushed oil prices above $100, heightening inflation expectations and dragging all three major U.S. indices down more than 1%. The options market shows $SPDR S&P 500 ETF (SPY.US)$ the previous trading day's put/call volume ratio rose to 1.27, with implied volatility (IV) reaching 18.70%.

On the individual stock front,$Intel (INTC.US)$Up 4.05% in pre-market trading, Intel reported second-quarter earnings that beat expectations, with AI-related data center revenue rising 59%. The options market shows the stock's put/call volume ratio has risen to 0.72, and implied volatility stands at 105.07%. Fundamental catalysts have already been largely priced into earnings and after-hours pricing.

Buying short-dated call options directly at this point entails significant volatility risk. Ahead of earnings announcements, markets typically price in potential gap moves. After results are released, even if the directional call on the stock is correct, call options may still underperform due to declining implied volatility and time decay.

$Oracle (ORCL.US)$ Up 3.4% in pre-market trading. Oracle secured a U.S. government enterprise software contract with a term of up to ten years. The base value of the contract over the first five years is approximately $3.31 billion. If all subsequent options are exercised, the total contract value could reach as high as $6.99 billion. Note that $6.99 billion represents the contract ceiling and does not equate to confirmed revenue. Future earnings contributions will depend on actual orders, execution progress, and whether the options are exercised.

The primary value of this contract lies in enhancing the long-term visibility of Oracle’s government software business. Government databases, enterprise software, and cloud infrastructure typically involve high switching costs; once customer relationships are established, renewal and expansion revenue tends to be relatively stable. In the options market, there has been concentrated put option activity and open interest near the $120 strike. This level could act as short-term support or, if breached, amplify volatility.

Yesterday’s Options Market Recap

Index Options

On July 23 Eastern Time, U.S. equity index options saw increased volume, with a total of 7.16 million contracts traded. The put/call volume ratio declined to 0.87.

For the upcoming expiration date,$S&P 500 Index (.SPX.US)$ Options volume distribution shows the following characteristics: peak put volume at the 7,400 strike and peak call volume at the 7,490 strike.

Single-Stock Options

$Micron Technology (MU.US)$Closed up 3.20%, with 664,700 options contracts traded and the put/call volume ratio rising to 1.11. Musk thanked Micron for allocating substantial memory chip capacity to Tesla, and Google’s increased capital expenditure boosted memory-related stocks.

$Tesla (TSLA.US)$Closed down 14.52%, with 3,605,400 options contracts traded and the put/call volume ratio rising to 0.83. Tesla reported adjusted Q2 EPS of $0.33, significantly below the expected $0.50, causing the stock to plummet 14.5%.

Options Volume Rankings

Among the top 10 stocks by options volume,$Micron Technology (MU.US)$has the highest put/call volume ratio, reaching 1.11.

The highest put/call open interest ratio is$Micron Technology (MU.US)$, reaching 1.33.

Implied Volatility Leaderboard (underlying market cap > $1 billion and options volume > 100,000)

$Bloom Energy (BE.US)$Implied volatility reached its highest level at 179.73%, down 0.53% from the previous trading day. JPMorgan raised Bloom Energy's price target from $267 to $346 and maintained a Buy rating.

$SpaceX (SPCX.US)$Implied volatility increased the most, reaching 112.42%, up 2.63% from the previous trading day. SpaceX shares rose 2.6% ahead of a critical Starship test flight, but the test was again delayed to Friday due to weather conditions.

Risk Warning

An option is a contract that grants the holder the right—but not the obligation—to buy or sell an underlying asset at a predetermined price on or before a specified date. Option prices are influenced by multiple factors, including the current price of the underlying asset, strike price, time to expiration, and implied volatility.

Implied volatility reflects the market’s expectation of future price fluctuations over a given period. It is derived by reverse-engineering the Black-Scholes option pricing model and is generally viewed as an indicator of market sentiment. When investors anticipate greater volatility, they may be willing to pay higher premiums for options to hedge risk, resulting in higher implied volatility.

Traders and investors use implied volatility to assess the attractiveness of option prices, identify potential mispricings, and manage risk exposure.

Disclaimer
This content does not constitute an offer, solicitation, recommendation, advice, opinion, or any guarantee regarding any securities, financial products, or instruments. The risk of loss in trading options can be substantial. In certain circumstances, your losses may exceed the initial margin deposit. Even if you place contingent orders such as 'stop-loss' or 'limit' orders, you may not be able to avoid losses. Market conditions may prevent the execution of such orders. You may be required to deposit additional margin on short notice. If you fail to meet such margin requirements within the stipulated time, your open positions may be liquidated. You remain fully liable for any resulting deficit in your account. Therefore, you should thoroughly research and understand options and carefully consider whether such trading is suitable for you based on your financial situation and investment objectives. If you trade options, you should be familiar with the procedures for exercising options and handling expiration, as well as your rights and obligations upon exercise or expiration. Options trading involves substantial risk and is not suitable for all investors. Investors should carefully read"Characteristics and Risks of Standardized Options"。

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