The cost of Apple options relative to other technology companies has risen to a four-year high, reflecting concern the iPhone and iPad maker’s dominance may be threatened by rivals such as Google Inc. and Nokia Oyj.
Implied volatility, which traders use to gauge option prices, for three-month contracts closest to Apple’s shares was 2.18 times more than the Technology Select Sector SPDR Fund last week, the highest level since September 2008, according to data compiled by Bloomberg. Apple shares have fallen 25 percent to $529.69 since a record high in September.
The options trading “is a reflection of market participants being a little bit more skeptical of Apple’s story going forward,” John Goltermann, who helps oversee $850 million at Obermeyer Asset Management Inc. in Aspen, Colorado, said in a phone interview on Dec. 12. His firm doesn’t own Apple shares. “The market is questioning what’s next on the innovation side and how they’re going to protect their margin.”
Best Buy slumped 15 percent to $12.05. Schulze can now make a proposal to buy the company from Feb. 1 through Feb. 28, Best Buy said today in a statement. The company agreed that it was in the best interest of shareholders to let Schulze and his partners include results from the holiday season in their due diligence review, the retailer said.
Smith & Wesson slumped 4.3 percent to $9.13 while Sturm Ruger & Co. dropped 4.5 percent to $45.57. President Obama said the Connecticut shooting, the most deadly in a string of mass killings this year, shows the nation must take “meaningful action” to stem such violence. Twenty-six people, including 20 children, died when a gunman walked into a Newtown, Connecticut, elementary school and opened fire this morning.
Schlumberger Ltd. dropped 5 percent to $68.91. The world’s largest oilfield-services provider said it expects earnings per share to fall because of delays and slowing activity in its two largest regional units.
Raw-material producers were the only group among 10 in the S&P 500 to gain as the S&P GSCI gauge of 24 commodities added 0.9 percent on bets that demand will increase in China. U.S. Steel rose 6.8 percent to $23.85. Alcoa increased 1.8 percent to $8.74.
Adobe Systems Inc. added 5.7 percent to $37.56 after the software company reported fiscal fourth-quarter sales and profit that topped analysts’ estimates as customers embraced its flagship Creative Suite.
FuelCell Energy Inc. jumped 7.5 percent to 94 cents. The U.S. manufacturer of fuel-cell power plants surged on an agreement to build a 14.9-megawatt power plant in Connecticut for Dominion Resources Inc.
Boston Scientific Corp. gained 0.7 percent to $5.67. The seller of drug-coated stents was raised to overweight from underweight at Barclays Plc by equity analyst Matthew Taylor. The share-price estimate is $7.