Trading in the option market remained on the quiet side Wednesday, but companies with significant news like Amazon.com ( AMZN) and Guidant ( GDT) were seeing their fair share of activity.

As Amazon's stock slid more than 12% a day after its earnings report, traders were buying puts to take advantage of the downside move. Those who believe the stock will continue to be weak were selling calls.

Traders who purchased the out-of-the-money calls before the earnings release thought Amazon's stock would trade higher Wednesday. The November 37.50 calls have traded 6,600 times, the November 40 puts were swapped 6,500 times, and 11,100 contracts on the November 45 puts changed hands. The November 45 calls were sold 3,800 times, as were the 47.50 calls.

Guidant's options were busy after the company said it received subpoenas from the Justice Department concerning documents on its pacemakers and other heart devices. Fellow medical-device makers Medtronic ( MDT) and St. Jude ( STJ) also got subpoenas.

Trading in Guidant's options has been active since Johnson & Johnson ( JNJ) said recently that it would consider alternatives regarding the companies' planned merger. News of the government probe would add to any concern traders might have had about the acquisition.

The November 65 calls have traded 7,600 contracts and were down 70 cents. Someone would sell the calls if they thought pressure would remain on the stock in the short term. The November 70 calls have traded 4,700 times. Meanwhile, the December 55 puts have traded 4,100 contracts and were up 30 cents. The open interest for the 55 strike was 15 contracts before the session. The stock was down $1.59, or 2.5%, to $63.11.

More than 16,500 contracts were exchanged on Microsoft's ( MSFT) November 25 calls. Microsoft is scheduled to release its earnings Thursday. With the stock trading around $25.21, the calls are slightly in the money. However, since the calls are going for 75 cents, the stock needs to trade above $25.75 for the buyer to see a profit.

Bank of America ( BAC) had bullish option activity as its stock traded higher. The December 42.50 calls have traded 3,100 times, and the December 45 calls have traded 10,500 contracts. The buyer of the 45 calls is expecting Bank of America's stock to trade at more than $45 by the December expiration. The open interest for the 45 calls entering the session was 1,820 contracts. Shares of Bank of America were higher by 35 cents, or 0.8%, to $43.53.

Activity was also notable in Lennar ( LEN), Calpine ( CPN) and Apple Computer ( AAPL).

Lennar's November 55 puts traded more than 6,700 times, and the November 65 puts traded 2,400 contracts. The stock was down 83 cents, or 1.46%, to $55.97. Calpine's January 2007 2.50 puts traded 7,600 times, and its shares were unchanged at $2.37.

Apple's November 60 calls were exchanged 8,200 times and rose 30 cents. The January 60 calls have traded 5,100 times. Shares of Apple were higher by $1.16, or 2.1%, to $57.26.

The CBOE Market Volatility Index (VIX), which is based on the implied volatility of the S&P 500 options and is often used as a gauge for fear in the market, was recently down 4% to 13.94. The CBOE Nasdaq Volatility Index, a measure of the implied volatility of the Nasdaq 100, was unchanged at 15.28.

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