The full magnitude of the earnings flood won't be felt for a few days, but option trading volume is picking up and volatility is rising as more and more companies report their results.

The CBOE Market Volatility Index (VIX), which is based on the implied volatility of the S&P 500 options and is used as a gauge for fear in the market, was recently up 1.68% to 15.88. The CBOE Nasdaq Volatility Index, an indicator for the implied volatility of the Nasdaq 100, was higher by 1.57% to 17.42.

General Motors ( GM) had a buyer of the January 2007 puts with a strike at 10 more than 25,000 times. The trading of these out-of-the-money puts is most likely hedging that's taking place in the credit default market. The stock was up 15 cents to $26.57.

The iShares Russell 2000 Index ( IWM) had extremely heavy put buying. The October 62 puts have traded 27,000 contracts, and the October 63 puts changed hands 31,000 times.

The October 64 puts traded 9,600 times, while 12,000 November 61 put contracts were exchanged. The November 62 puts traded 27,500 times, and the January 62's were swapped 19,300 times. The ETF was down 86 cents, or 1.38%, to $61.64.

Apple Computer ( AAPL) had heavy activity in its October options after the company's revenue line and iPod unit sales failed to meet Wall Street's expectations. The October 50 calls have traded 25,000 times and were down $1.80. The October 52.50 calls have traded 16,500 times, and the October 55 calls have traded 17,300 contracts.

Apple's October 47.50 puts moved 25,000 times, and 26,300 October 50 put contracts traded. The stock was down $1.82, or 3.53%, to $49.77.

More than 26,000 October 25 put contracts for Pfizer ( PFE) were sold after the U.K.'s High Court of Justice upheld its exclusive patent for an active ingredient in the cholesterol drug Lipitor. The options were lower by 65 cents. The stock was up 57 cents, or 2.35%, to $24.87.

Microsoft ( MSFT) had mixed option activity. The November 25 puts have traded 10,400 times, and the November 25 calls have traded 9,600 contracts. The January 27 calls traded 40,000 times. The stock was down 1 cent to $24.40.

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