High Petrobras Options Volume Indicates Potential Downturn For Stock Despite Analyst Upgrade

On Thursday, the energy sector emerged as one of the weakest performers on the S&P 500, with shares of Petróleo Brasileiro S.A. – Petrobras PBR closing lower.

On CNBC’s "Options Action,"  Mike Khouw of Optimize Advisors said Petrobras traded at 7x average daily put volume on Thursday.

Don’t forget to check out our premarket coverage here

There was a buyer of 80,000 of the July 14/13-put spreads at an average price of 22 cents per contract, Khouw mentioned.

Traders expect Petrobras shares to fall as far as 11% by July expiration.

Goldman Sachs analyst Bruno Amorim recently upgraded Petrobras Brasileiro from Neutral to Buy and raised the price target from $13 to $18.10.

Price Action: Petrobras shares fell 1.7% to close at $14.68 on Thursday and fell 1.9% in Friday’s premarket trading session.

Check This Out: Smith & Wesson Brands, CarMax And 3 Stocks To Watch Heading Into Friday