With CPI inflation data in the morning and software giant Oracle
reporting earnings after the bell, Wednesday presents a big test for a U.S. stock market trying to find its footing after its worst day in a year and a nail-biting whipsaw session on Tuesday.
There’s reason for optimism, judging by bullish options flows around stocks that do better when interest-rates stay lower, and call-buyers who are prepared for the biggest move in Oracle since Covid.
First, inflation: despite economists expecting annualized CPI to hit above 4% for the first time in three years, interest-rate sensitive sectors were the best performers on Tuesday. Bonds firmed and regional banks rallied alongside homebuilders as small-caps finished the day higher.
Options trading in homebuilding ETFs XHB
and ITB
was almost entirely in calls. In ITB, traders bought 3,200 calls, compared to just 68 puts, and in XHB, calls outpaced puts almost 10-to-1. In the regional bank fund KRE, traders bought more than three times as many calls as puts.
One reason for optimism around interest rates could be that crude oil slipped below $86 per barrel Tuesday, the lowest since mid-April.
Link: https://www.cnbc.com/2026/06/10/two-reasons-for-optimism-after-tuesdays-whipsaw-market-sell-off.html