Cantor Morning News

ARNA (6.74 +0.17) Options are becoming more active ahead of the scheduled FDA Panel review of the company's obesity drug on Sep 16. One investor bought 5,000 Sep 5/11 risk reversals for 0.70/spread (bought Sep 5 Put and sold Sep 11 call.) This is either an outright bearish trade or strategy intended to hedge a long stock position.

ME (22.75 -0.60) Puts traded over 50k contracts after an explosion was reported on one of the company's Gulf rigs. Sep 20 Puts were the most active, trading as high as 4.30 before settling back down to .30 (We should note that puts traded only as high as 1.75 on any significant volume.)

VIX (23.19 -0.70) Puts traded > 170,000 contracts today, mostly due to a customer buying the October 25 puts and selling the September 25 Puts 50,000x, most likely rolling a long put position from Sept to Oct (perhaps betting on the market to rally and the VIX to therefore drop in value.)

GT (10.13 +0.60) Bullish option activity after the company announced an increase in prices on consumer tires of 6% to offset rising raw material costs. The Sep 10 Calls and Oct 12.5 Calls were the most active and traded >5,000 contracts each, driven by buyers.

TIN (18.86+1.69) Bullsh: Calls traded more than 7400 contracts, or 11x average daily volume, as one investor bought 5,000 Oct 19 Calls for 70 cents. No apparent news.

DFS (15.54 +0.38) CNBC reported that "JPM Chase has not ruled out the possibility of buying the Discover Financial…" One trader bought more than 5,000 Oct 15 Puts at .70, in a delta-neutral transaction, where the customer also bought 40% as much stock at 15.30.

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