Schaeffer's Midday Options Update Features Wm. Wrigley Jr. Company, Dow Jones & Co., Lowe's, Family Dollar and Advanced Micro Devices.

CINCINNATI -- Today's Schaeffer's Midday Options Update Features Wm. Wrigley Jr. Company (NYSE:WWY), Dow Jones & Co. (NYSE:DJ), Lowe's (NYSE:LOW), Family Dollar (NYSE:FDO), and Advanced Micro Devices (NYSE:AMD). 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. For additional information about this report or to have it delivered to you free via email every day click on the following link: http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1M&PAGE=1

Options Update: Pessimism Powers Advanced Micro Devices Higher

So far today, trading has been mixed but oil is doing its best to continue the rally seen over the past two weeks. Oil has continued its retreat today, giving support to possibly drive the market higher. December crude fell to its lowest intraday level since September 21, sliding to $45.50 per barrel. No major oil-related news over the weekend, combined with ever-increasing inventories have helped drive the price of oil lower today. In an article on CBS MarketWatch, an analyst at Alaron Trading feels that the continued increases in crude inventories will offset any concerns over the supplies of heating oil as we proceed into the winter months.

Mergerama

Investors were met with a plethora of merger and acquisition news this morning, started off by Wm. Wrigley Jr. Company's (NYSE: WWY) announcement that it is going to acquire the candy arm of Kraft Foods (KFT). This acquisition appears to quench the cravings of WWY's sweet tooth, left wanting after a failed bid of $12.5 billion to take over Hershey Foods (HSY) more than a year ago. Thanks to this acquisition, WWY will gain hard and gummi candies, lollipops, mints, sours, and fruit chews from KFT. The takeover carries a price tag of $1.48 billion dollars and will close near the middle of 2005. It is believed that WWY's first-quarter earnings will slip thanks to the merger; however, analysts believe that this transaction will add to WWY's earnings.

The second major acquisition news concerns market-news power hitters Dow Jones & Co. (NYSE: DJ) and MarketWatch (MKTW). Last month it was announced that Viacom (VIA) was putting MKTW up for sale, drawing bids from the New York Times (NYT) and Yahoo! (YHOO) among others. DJ will pay $18 per share for MKTW, ending a bidding war that lasted for a month. The acquisition will allow DJ to reach into the consumer financial news field. The deal still needs shareholder approval.

Other mergers and acquisitions making news today include:

--Perrigo (PRGO) signed a deal to acquire Israel-based Agis Industries in a deal believed to be worth $818 million in stocks and cash.

--General Electric (GE) will buy Edwards Systems Technology from SPX Corp. (SPW) for $1.4 billion. Edwards Systems Technology specializes in fire safety.

--Empire Resorts (NYNY) agreed to acquire Concord and Grossinger's resort hotels and golf courses from Concord Associates LP.

--GenCorp (GY) rejected a takeover attempt valued at $772 million from Steel Parners II LP.

Feeling Low

Lowe's (NYSE: LOW) reported third-quarter earnings of 66 cents per share this morning, besting the consensus estimate of a gain of 65 cents per share. Third-quarter sales leaped 16.2 percent above the same quarter last year, accompanied by same-store sales that rose 5.2 percent during the quarter. This good news was tempered by the company's announcement that it expects fourth-quarter earnings of 58 to 60 cents per share, the high end of which matches the Street's estimate. Currently LOW is trading more than three percent lower in today's action. For more information on LOW's earnings report, read "Lowe's Beats the Street."

Fun for the Family

Family Dollar Stores (NYSE: FDO) has jumped nearly three percent in trading today after Barron's covered the retailer in a positive article. According to CBS MarketWatch, the article called FDO a "compelling bargain," much like its low-priced offerings. The article also suggested that FDO's sale-lifting restructuring plan will be a boon for the company.

Most-Active Options Update

At 1:36 p.m. eastern time, the Dow Jones Industrial Average (DJIA - 10,552.7) is up 0.13 percent and the S&P 500 Index (SPX - 1183.42) is lower by 0.06 percent. The Nasdaq Composite (COMP - 2091.8) is up 0.31 percent. At 1:37 p.m. in the options pits, 2,444,764 calls and 1,204,702 puts traded for a composite put/call ratio across all five exchanges of 0.49. The CBOE put/call ratio for equity options weighed in at 0.37.

Advanced Micro Devices

It seems that pessimism has taken up residence on Advanced Micro Device's (NYSE: AMD) front porch lately. The stock continues to attract a slew of naysayers, as its Schaeffer's put/call open interest ratio of 0.87 ranks above all those taken in the past 52 weeks. However, Friday's announcement that AMD's CFO sees revenue growing by more than $1 billion in the next 24 months in China, India, Eastern Europe, and Latin America may have brought some of the bulls back to the table. In today's session, more than 14,000 calls have crossed the tape so far at the stock's January 25 strike. But with open interest of 33,998 contracts, we will have to wait until tomorrow to see if any of today's activity will translate into new positions.

Short sellers are still trying to call a top for the equity, as short interest increased by 10 percent over the past month to once again threaten new multi-year highs. Not only would it take nearly seven days to cover this sizeable bearish position, but the 64.71 million AMD shares sold short accounts for nearly 19 percent of the stock's total float. If the equity continues its march higher, a short-squeeze situation could spark a sharp rally higher for the security.

Wall Street is even down on AMD, with 15 of the 22 covering analysts rating the shares a "hold" or worse. Any upgrades from this dour bunch could add fuel to the equity's advance.

Turning to the technical picture, AMD is now trading at its highest level since July 2001, having nearly doubled in value since setting a low of 10.76 in early September. During this time frame, AMD has even bested its peers in the COMP, outperforming the tech-laden index on a relative-strength basis. What's more, the stock has even taken out long-term resistance at the round-number 20 level in its quest for higher ground. With the equity continuing to advance in the face of extreme levels of pessimism, AMD's rally could be far from over.

Click on the following link to see a Weekly Chart of AMD Since June 2001: http://www.schaeffersresearch.com/wire?ID=11752&obspage=2

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

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.