Chip Makers' Puts Trade Actively
Dow Jones Newswires</br></br>NEW YORK -- The options market's fear gauge fell back from early rises in a volatile session punctuated by poor jobs data, higher energy prices and mixed news from a trio of chip makers.</br></br>Investors showed concerns over another jump in the price of oil and a weekly government report that first-time jobless claims rose last week, as opposed to the decline expected by economists. Disappointing sales forecasts from chip makers Xilinx Inc. and Altera Corp. also sent shivers through the market. A solid earnings report from National Semiconductor Corp., a big chip maker, helped lift the mood.</br></br>The Chicago Board Options Exchange volatility index spent more than half of the day up. Then it reversed course in the early afternoon to close down 0.31 point at 12.88. The index, also known as the options market's risk forecast, measures short-term anticipated volatility in the Standard & Poor's 500-stock index.</br></br>Investors bid up the December puts of Xilinx and of Altera after their weak sales outlooks for the current quarter, which were released after Wednesday's close. Xilinx's out-of-the-money December 27.5 puts rose five cents to 15 cents on the CBOE. About 14,000 of those contracts changed hands, nearly seven times more than the open interest of 2,077. The stock was down $1.01 to $29.72 at 4 p.m. in Nasdaq Stock Market trading.