AMAT - Earnings season approaches and UBS sees options opportunities in tech: Alpha Tactics

The stocks market wrapped the week higher thanks to Monday's catch-up rally from the strong nonfarm payrolls report released on Good Friday.The S&P 500 (SP500) (SPY), up 2.7% for the week, and Dow (DJI) (DIA), up 2%, hit new records. The Nasdaq (COMP) gained 3.1% during the week and the Nasdaq 100 (NDX) (QQQ) was up 3.9%.But volume was low through the week with earnings season set to get in gear.UBS' options team sees the setup for Q1 earnings similar to Q4, with a consensus Q/Q decline in EPS and implied moves at +/- 4.2%, which would be in line with Q4 and above the long-run average of +/- 4%.Strong fundamentals and relatively high options prices indicate below-average beats of option-implied moves, but there are "pockets of opportunity" in Info Tech (XLK), Communications Services (XLC) and Industrials (XLI)."Historically the highest implied move beat rates have been in Tech (43%) and Industrials and Staples (XLP) at 42%,"

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Earnings season approaches and UBS sees options opportunities in tech: Alpha Tactics