Schaeffer's Daily Market Blog Features Anheuser-Busch, Eastman Kodak, Univision, U.S. Airways, and Microsoft

Business Wire, June 21, 2006

CINCINNATI -- Among the stocks featured in the June 21 edition of Schaeffer's Market Blog are Anheuser-Busch (NYSE:BUD), Eastman Kodak (NYSE:EK), Univision (NYSE:UVN), U.S. Airways (NYSE:LCC), and Microsoft (NASDAQ:MSFT). Schaeffer's Market Blog is just one of the many free market commentaries written every day at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. 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=PROB12M&PAGE=1 .

Schaeffer's Market Blog for Wednesday, June 21, 2006:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1 .

9:47 AM BUD May Dabble in Liquor

According to The Wall Street Journal, Anheuser-Busch (NYSE:BUD) is considering expanding its offerings out of the malted hops and barley realm and is looking into wine and spirits. The largest brewer in America stated that it may expand into the liquor industry if wine and spirits continue to eat away at its market share. According to the Journal, August Busch (BUD's president) stated that, "If this trend continues, we at Anheuser-Busch will have to re-evaluate our business model going forward in terms of expanding beyond beer and broadening our position within the total alcohol industry." These remarks were made earlier this month at a national gathering of state liquor administrators in Boston. According to the newspaper, beer has lost five percentage points of U.S. market share to wine and spirits since 1995.

Technically, the brewing behemoth has found a bit of options-related support at the 45 level. Not only is this level the site of peak put open interest, but it is also a level of prior resistance. Oftentimes, past resistance will step in to provide support when given the chance, and that certainly appears to be happening here. The road higher isn't clear, BUD faces resistance from its 10-month and 20-month moving averages. If this resistance is overcome, the path higher becomes a bit more clear, but the 50 level stands as the major roadblock. This level turned the share away in 2000, and most recently acted as support from 2002 through 2004.

12:52 PM Kodak Puts Trading Actively

There has been some unusual option activity on Eastman Kodak (NYSE:EK) today. More than 11 times the average number of put options have traded on the equity with total volume around 12,000 contracts. Pessimism has surrounded this stock, and with the shares trading near the bottom of their trading range, there could be the possibility of a modest move higher from current levels.

1:31 PM Univision Down and Up on Takeover News

Univision (NYSE:UVN) is sharply lower today after news that buyout bids for the company may not be as high as previously thought. After gapping down to around the $33.50 level, the stock has pushed higher throughout the session and is currently trading at $34.24. Whether or not the broader market rally has helped the stock is tough to say. Nevertheless, call option activity on the stock is quite heavy. Each of the past two sessions have seen call volume in excess of two times respective put volume. This could be smart money or over-optimism, but either way the situation surrounding the stock may remain quite volatile.

2:53 PM Huge Rally

Talk about an impressive rally; literally everything on my screen is green. Right now the Dow Jones Industrial Average is up 150 points and the SPX is up 17 points. There were a few good earnings reports to spur the buying, but I think today the market is rallying simply because it wants to. Internals are great and volume is pretty decent as well (at least better than the past few days). Just about every sector is up several percent, but one that I like here is airlines. In fact, I wrote about this group yesterday and you can see why I like them. Looking at some of the names, U.S. Airways (NYSE:LCC) is up three percent, AMR Corp. (AMR) is up two percent, and Continental Airlines (CAL) is up over four percent.

3:15 PM Gold is Strong Again

One sector that is starting to look tempting to me is gold, as the metal closed up $11 to $591.50 an ounce. There's little doubt that this group has been hammered the past month, but the action the past week has been very bullish. Back on June 13th gold was down over $30 and on the 14th it was down some more, but on the 14th the PHLX Gold and Silver Index (XAU) was actually up a little bit - a sign of outperformance. Since then the XAU has done pretty well and today it's up about four percent, making a new two week high in the process. Looking at some of the names in the group, Newmont Mining (NEM) is up two percent, Goldcorp (GG) is up four percent and Glamis Gold (GLG) is up a massive nine percent.