Schaeffer's Daily Market Blog Features General Motors, Ford Motor, PETsMART, McDonald'...

CINCINNATI -- Among the stocks featured in the August 25 edition of Schaeffer's Market Blog are General Motors (NYSE:GM), Ford Motor (NYSE:F), PETsMART (NASDAQ:PETM), McDonald's (NYSE:MCD), and Toll Brothers (NYSE:TOL). Schaeffer's Market Blog is just one of the many free market

commentaries written everyday 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=PROB1M&PAGE=1 .

Schaeffer's Market Blog for Thursday, August 25, 2005:

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 .

11:25 AM GM Offer Extended

General Motors (NYSE:GM) has again extended its employee discount to the end of September. The discount will include some 2006 pickup trucks and SUVs. I notice that GM stock was down seven cents at last check but the stock appears to have gained the support of its 10-day moving average, an encouraging sign. Meanwhile, Ford Motor (NYSE:F), which slipped below the significant 10 level on August 17, has today slipped below its 10-day moving average. Stock in F saw heavy volume yesterday after Chief Executive Bill Ford Jr. said the company has further restructuring plans in mind.

11:46 AM PETsMART Reports Earnings, Guides Third-Quarter Earnings Lower

Last night after the market close, PETsMART (NASDAQ:PETM) reported earnings of 24 cents per share, two cents ahead of analyst expectations. The company guided its third-quarter estimates lower. PETM now sees earnings of 21 cents per share for the third quarter versus prior expectations of 26 cents. Revenues for the quarter came in below analyst expectations, as PETM reported revenues of $899.1 million versus expectations of $905.2 million.

Technically speaking, the equity looks dangerously close to violating support of the neckline of a head-and-shoulders top. Market players should keep a close eye on PETM to see if it is able to hold this support level. At last check, the stock was trading off nearly 10 percent to 25.75.

1:46 PM McDonald's Looking Vulnerable

Call activity is quite heavy today on McDonald's (NYSE:MCD), especially at the October 32.50 strike where more than 10,000 contracts have crossed the tape. There have been more than 16 call options traded for every put thus far today. Most of these calls appear to be purchases. The Schaeffer's put/call open interest ratio (SOIR) of 0.41 on MCD is already the lowest reading of the year, and illustrates a very high level of optimism on the security. I'd be careful of the shares at these levels, especially since MCD is upon a previous resistance level near 35.

2:32 PM Let's Talk about Housing

Not much is happening out there today. All the major indexes are up just slightly, and the one major takeaway that I see from today is that volume is lagging big time, so it looks like nothing more than a low volume bounce. Also check out housing stocks. They were all up this morning after Toll Brothers (NYSE:TOL) came out with positive earnings, but they have since sold-off on the news. In fact, TOL was up over one percent at the open, and now it's down over two percent. That type of price action after an event isn't very promising. None the less, in my opinion it looks like most traders are taking the day off after yesterday's late sell-off.

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

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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 .