Schaeffer's Midday Options Update Features Corning.

CINCINNATI -- Today's Schaeffer's Midday Options Update features Corning (NYSE:GLW). The Midday Options Update 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 www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. E[acute accent]Take advantage of the timely Schaeffer commentaries by signing up for their free e-newsletters -- Opening View, Market Recap and Monday Morning Outlook. Click here to have the Schaeffer's commentaries delivered to you free via email every day. http://www.schaeffersresearch.com/redirect.aspx?CODE=PRMOU12M&PAGE=1 .

E[acute accent]Options Update: Corning Warning

E[acute accent]The Federal Reserve's Beige Book revealed that upward pressure from energy and other inputs is persisting, despite reports that the pace of growth in the U.S. economy has slowed. All 12 Fed districts said their economies were still growing in the last two weeks of June and the first two weeks of July. However, there were "numerous individual reports pointing to evidence that the pace of growth has slowed." Six Fed districts reported a decline in the overall rate of growth in their regions. At the same time, pressure on prices from the high price of gasoline persisted and in some cases increased.

E[acute accent]Most-Active Options Update

E[acute accent]At 2:55 p.m. Eastern Time, the Dow Jones Industrial Average (DJIA - 11,148.4) has added 0.40 percent. The S&P 500 Index (SPX - 1,273.2) has gained 0.34 percent, and the Nasdaq Composite (COMP - 2,083.3) has advanced 0.45 percent. At 2:55 p.m. Eastern Time, 3,496,220 calls have changed hands compared to 2,429,436 puts, equaling a single-day put/call volume ratio of 0.69. The CBOE's equity put/call volume ratio stands at 0.78, while the ISE's ratio comes in at 0.66.

E[acute accent]Corning

E[acute accent]Corning (NYSE:GLW) gapped lower on the open after the company announced second-quarter results late yesterday. Net income came in at $514 million, or 32 cents per share, up from its year-earlier profit of $165 million, or 11 cents per share. Ex-items, earnings of 26 cents per share beat the consensus analyst estimate by a penny. Revenue rose to $1.26 billion from $1.14 billion a year ago, but missed the consensus analyst estimate of $1.32 billion. E[acute accent]However, the Dow Jones Newswires said the company "provided disappointing third-quarter estimates as a result of an inventory backup that is choking sales of its flat panel displays." E[acute accent]This morning, brokerage Needham reiterated the stock at a "strong buy" rating. A quick look at Zacks reveals nine analysts covering the stock, with seven of the seeing it as a "strong buy" and the remaining two rating it a cautious "hold." There are no "sell" ratings at all, which is disturbing from our contrarian perspective, because the chances of upgrades here are not strong.

E[acute accent]Quick Sentiment Facts on GLW:

E[acute accent]-- Percent of analysts tracked by Zacks who rate the stock with a "buy" or better: 78%

E[acute accent]-- Number of analysts tracked by Zacks: 9

E[acute accent]-- Short interest as a percent of float: 1.03%

E[acute accent]-- Schaeffer's put/call open interest ratio (SOIR): 0.67

E[acute accent]-- SOIR percent rank: 47%

E[acute accent]-- Overall Schaeffer's Equity Scorecard rating: 2.0

E[acute accent]Short interest is low, too, so we won't be hoping for any short-covering support if the stock does start to rise. And on our Schaeffer's Equity Scorecard the stock earns 2.0 out of 10. Remember that scores close to zero are bearish, and scores close to 10 are bullish. E[acute accent]Turning to the technicals, this morning's declines have caused the stock to breach the support of its 20-month moving average. A failure to recover would be a disturbing signal. It has already lost the support of its 10-month trendline this month. I notice GLW also breached its 80-month moving average this month. E[acute accent]Further layers of resistance are supplied by the stock's 10-day and 10-week moving averages, which seem determined to guide it lower. E[acute accent]I suppose it should come as no surprise that GLW puts have been active today. The August 20 put (GLW TD) made it to our most-active options list, with 11,542 contracts crossing the tape this morning by the time we grabbed our figures for this piece. Open interest before the day's trading began was 19,404. At close of business yesterday, those puts were out of the money, but they're certainly in the money now. In the great Wall Street Tug 'o War, GLW has traded as high as 20.22 and as low as 18.51 today. At last check, it was within eight cents of that lower limit. The bears are winning this argument. E[acute accent]Click here to see a Monthly Chart of Corning since October 2004 with 10-month and 20-month moving averages, and Weekly Chart of Corning since March 2005 with 10-week and 20-week moving averages: http://www.schaeffersresearch.com/wire?ID=17005 .

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E[acute accent]About Schaeffer's Investment Research (www.SchaeffersResearch.com)

E[acute accent]Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .