MBIA (MBI) is up 40 cents to $10.24 in active trading of more than 5 million shares after MKM Partners speculated that the company might soon reach a settlement with Bank of America (BAC) and Societe Generale. The speculation comes two days after the stock fell on news the New York State Department of Financial Services postponed a decision regarding the company’s July 16 interest payments (see 7/10 color). The idea is that NYSDFS is putting pressure on the company to reach a settlement before giving MBIA permission to make the payments. Shares are up in active trading and options volume is roughly 20,000 calls and 6,600 puts. July 10 and 11 calls are the most actives. 30-day ATM vols are up another 31 percent to 98 and reaching new 52-week highs.
About the Author (Author Profile)
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.