The upbeat action that began Thursday on

chinadotcom

(CHINA)

seeped into Friday's session as options traders continued to make optimistic bets on the stock.

chinadotcom, a pan-Asian Internet firm, has seen its stock surge for two consecutive sessions. The stock closed Wednesday at $15.50. Shares of chinadotcom were up $2.25, or 12.8%, to $19.88 on Friday. Volume on the stock was high Friday, with 8.7 million shares changing hands, well above the average daily volume of 1.7 million. Volume on the stock was also high on Thursday, with 5.8 million shares changing hands.

And that heat also is being felt in chinadotcom's options, which have been active Thursday and Friday.

One trader at the

Chicago Board Options Exchange

pointed out there were "a lot" of call buyers on chinadotcom Friday, however he didn't know what the motivation was behind the activity.

In his daily research note to clients, Larry McMillan of

McMillan Analysis

, pointed out options volume on chinadotcom on Thursday was unusually high. A total of 3,042 options traded, 2,927 of which were call options, McMillan said.

TheStreet Recommends

Average daily options volume on chinadotcom has been 587 contracts, he noted.

Such call option activity makes traders suspect that some positive event will drive the stock higher in the near future

On Friday, most of the volume in the options stayed on the call side. At the CBOE, where the heaviest volume was being seen, 217 of the out-of-the-money September 20 calls changed hands, trading up 11/16 ($68.75) to 1 3/8 ($137.50). The September 20 calls were also seeing decent volume on the

American Stock Exchange

and

Philadelphia Stock Exchange

.

On Aug. 28,

Credit Suisse First Boston

initiated coverage of chinadotcom with a buy rating on the stock, and a price target on the shares of $25.50. CSFB in the note projected chinadotcom will be profitable in the fourth quarter of 2001.

Lehman Brothers

took chinadotcom public in July 1999.