Brian Belski, BMO Capital Markets Chief Investment Strategist, joined Yahoo Finance to evaluate how inflation concerns are impacting the market.
(Bloomberg) -- While the stock market was having its worst day since February, someone was getting fancy with options on one of the rout’s higher profile casualties: Facebook Inc.A trader Wednesday paid $26 million for 39,000 call spread contracts comprised of March 2022 calls with a $400.01 strike price and March 2022 calls with a $480.01 strike. Facebook has tumbled nearly 7% in May to $302.55 as inflation fears have battered tech shares.The exact intent of the position, which bears a slight resemblance to some of the so-called Nasdaq whale trades that made headlines last summer, is open to interpretation. One analyst, Chris Murphy of Susquehanna, sees it as a strategy to amplify the payoff of a rally in the social media giant, for someone who may or may not already own the stock.“I would describe it as adding leverage to a more dramatic upside move,” said Murphy, a derivatives strategist. “There is always the chance it traded against stock to have less impact and they will work out of the stock on the back end.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The crypto bank will issue the Diem stablecoin through its Silvergate Exchange Network and manage the U.S. dollar reserve tied to it.