Daily Commentary from SIR Highlights the Following Stocks: Tyco, Gillette, Novell, Network Appliances, General Electric.

Business Editors

CINCINNATI--(BUSINESS WIRE)--Nov. 4, 2003

This daily report contains a brief commentary on the day's most notable activity and a table listing the most active calls and puts for the day. The Midday Options Update is published every day at SchaeffersResearch.com. For additional information about this report or to have it delivered to you via email everyday click on the following link: http://www.schaeffersresearch.com/addinfo.

Today's Daily Commentary focuses on: Tyco (NYSE:TYC), Gillette (NYSE:G), Novell (NASDAQ:NOVL), Network Appliances (NASDAQ:NTAP), General Electric (NYSE:GE).

The market tripped lower this afternoon as investors sloshed through the latest wave of economic news and earnings reports. According to Challenger, Gray, & Christmas, October lay-off levels soared 125 percent to total 171,874; ending three consecutive months of declines. News was slightly mixed out of the retail sector, as weekly chain store sales rose 0.5 percent - marking the first increase in four weeks. However, forecasts for October were trimmed to 2.5 percent from 2.5-3.0 percent. Monthly retail sales are not expected until November 6.

In corporate news, Tyco International (NYSE:TYC) announced plans to cut 7,200 jobs. The firm also revised its first-quarter earnings estimate to 30-32 cents per share compared to the Street estimate of 33 cents per share. It also anticipates a 2004 profit of $1.42-1.52 per share versus the consensus estimate of $1.52 per share. Speaking of earnings, Gillette (NYSE:G) pleased investors by reporting a profit of $416 million, or 44 cents per share. Its announcement surpassed the Street estimate by five cents per share.

News of fresh acquisitions continues to snowball. Novell (NASDAQ:NOVL) announced plans to buy Suse Linux for $210 million in cash while Network Appliances (NASDAQ:NTAP) grabs up Spinnaker Networks for $300 million in stock. Turning to the biotechnology area, Cephalon reported plans to buy Cima Labs for $515 million in cash.

At 1:31 p.m. eastern time, the Dow Jones Industrial Average (DJIA - 9841.1) is down 0.17 percent and the S&P 500 Index (SPX - 1053.31) is lower by 0.54 percent. The Nasdaq Composite (COMP - 1958.4) is down by 0.47 percent. At 1:33 p.m. in the options pits, 1,481,029 calls and 934,559 puts traded for a composite put/call ratio across all five exchanges of 0.63. The CBOE put/call ratio for equity options weighed in at 0.49.

We check in on General Electric (NYSE:GE) this afternoon. The stock has seen roughly 12,000 contracts cross the tape at its January 2004 30 call. Open interest at this strike already sits at a lofty 118,383 contracts. The security's Schaeffer's put/call open interest ratio checks in at 0.77, which is in the 99th percentile. However, traders should be aware that the ratio spiked sharply higher following October option expiration. In fact, more than 35,400 calls have accumulated at the equity's November 30 strike. Not only could these contracts act as resistance, but they also indicate growing optimism. What's more, short interest plunged by 17 percent over the most recent reporting period to 41.2 million shares. This is only two times its average daily trading volume, reducing the chances of a covering rally.

Technically speaking, the equity continues to be capped by resistance at its 10-day and 20-day moving averages. Additional resistance at the stock's 20-week trendline also sits overhead. With optimism growing in the face of the security's continued weakness, it looks like these shares have some more room to fall.

Click the following link to see the Daily Chart of GE since September 2003: http://www.schaeffersresearch.com/wire?ID=8801.