China E-Tailer Pops on Rise in Consumer Prices

Options bulls are blasting the security today

PDD Holdings Inc (NASDAQ:PDD) is down 3.2% at $113.82 at last check, following news consumer prices in China rose for the first time in six months. The data points to an inflation rebound and fueled hopes of a recovery in the economy, pushing several China stocks higher as a result.

Options bulls are chiming in, with 24,000 calls traded so far — triple the intraday average amount — versus just 4,904 puts. Most popular is the weekly 3/22 125-strike call, where new positions are being opened.

Despite today’s pop, the shares are still trading firmly below the 40-day moving average, which rejected a mid-February rally. PDD has faced a handful of bear gaps since its Jan. 11. three-year high of $152.99, and sports a 32.4% year-over-year lead, despite being down 22.5% in 2024.

An unwinding of pessimism in the options pits could fuel additional gains for the security, which sports a Schaeffer’s put/call open interest ratio (SOIR) of 1.05 that sits higher than 87% of annual readings. In simpler terms, short-terms options traders have rarely been more put-biased.

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