Banco Santander (STD), the Spanish bank, is down 21 cents to $9.71 and options action is brisk, with 12,000 calls and 2,275 puts trade so far. The action includes two blocks (3,500 and 4,000) of Jan $10 calls at 25 cents when bid-ask was 15 to 25 cents. 8,446 now traded vs. 2,086 in open interest. Jan $11 calls and Feb 9 puts are seeing interest as well. Implied volatility is up 6 percent to 55 and the heightened activity is likely a play on developments in Portugal. ECB officials apparently threw the country a lifeline Monday by buying bonds. Bailout hopes for Portugal might be fueling the bullish sentiment in Banco Santander, perhaps raising hopes that the Debt Crisis will stop spreading throughout the euro-zone like an STD.
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Frederic Ruffy is a well-known trader, writer, and strategist who has spent years educating investors and creating intelligent, insightful, unbiased market observations that are frequently cited by the Wall Street Journal and other financial publications. As senior analyst, Fred provides frequent and regular notes and daily updates for activity of interest.