With listed stocks getting knocked around, the New York Stock Exchange is considering extending temporary relief from listing requirements. Once a company is dropped from the exchange, it runs risks ranging from market cap loss to limited liquidity. But NYSE Euronext (NYSE: NYX) CEO Duncan Niederauer was clear that the moves are not permanent. For now, the goal remains to protect companies that are at risk of being delisted. This comes after the S&P 500 fell 38% last year -- its worst performance since 1937.

The two rules that have been relaxed are the maintenance of a share price of at least $1 and a market cap of at least $15 million. The return of both measures was delayed back in April. Currently, 31 companies on the NYSE are at risk, including Blockbuster Inc. (NYSE: BBI) and Lear Corp (NYSE: LEA).

Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX down 1.47 to 15.80

Chicago Mercantile Exchange Holdings, Inc. (NYSE:CME) - April option implied volatility increases on ICE offer for BOT.
CME is recently down $14.94 to $548.78. The ICE announced an offer to issue 1.42 shares for each BOT share. CME and BOT announced a merger on 10/17/06. CME is paying 0.3006 shares for each BOT share. Shareholder votes by CME and BOT shareholders are set for 4/4/07. Smith Barney says: "if the CME/BOT deal does not go through, investors could bid up NMX shares on speculation of a CME/NMX deal." SBSH has a Hold rating on CME. CME April option implied volatility of 31 is above its 26-week average of 29 according to Track Data, suggesting slightly larger risk.

NYSE Group Inc. (NYSE:NYX) call volume heavy on spreaders adjusting on evolving Fundamentals.
NYX is recently up $0.70 to $83.01. The ICE announced an offer to issue 1.42 shares for each BOT share. CME is paying 0.3006 shares for each BOT share. Shareholder votes by CME and BOT shareholders are set for 4/4/07. Smith Barney says "if the CME/BOT deal does not go through, investors could bid up NMX shares on speculation of a CME/NMX deal." NYX call option volume of 38,141 contracts compares to put volume of 10,864 contracts. NYX April option implied volatility is at 33, puts are at 43. NYX 26-week average option implied volatility is 40 according to Track Data. NYX puts are expensive because NYX is difficult to borrow.

Option volume leaders today were: Accredited Home Lenders Holding Co. (NYSE:LEND), NYSE Group Inc. (NYSE:NYX) and Apple Inc. (NASDAQ:APPL).

NYSE Group, Inc. (NYSE: NYX) opened at $89.60. So far today the stock has hit a low of $88.46 and a high of $90.00. NYX is now trading at 89.75, up 1.33 (1.5%).

After hitting a one year high of 112.00 in November, the stock has been relatively flat around 100 until it dove down below 90 over the past week. NYX shares are up despite a competitor's disappointing earnings release this morning. The Nasdaq Exchange (NASDAQ: NDAQ) also failed in its takeover bid for the London Stock Exchange, and rumors are swirling that the LSE could look to partner with NYX. Recent technical indicators for NYX have been bearish and steady.

For a bullish hedged play on this stock, I would consider a March bull-put credit spread below the $75 range. NYX hasn't been below 75 since September and has shown support around 79.00. This trade could be risky if the stock market makes a decent sized correction, since the exchanges get hit hard when trading slows. However, if NYX does falter, the support formed in October around 75 could protect this position.

Brent Archer is an analyst on the move at Investors Observer. (Free Subscription)

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.

Note: The Daily Option Update is provided by Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX down .22 to 10.09.

Cisco Systems Inc. (NASDAQ:CSCO) -- option volume heavy as February implied volatility bid up on hedges into EPS. Cisco, the largest vendor of data networking equipment and the leading global supplier of internet-working solutions is expected to report EPS on 2/6. Goldman Sachs says "we believe there is a high likelihood of Cisco beating our and the Street's estimates of $8.28 billion/$0.31. We expect management to reaffirm positive longer-term trends in emerging markets, new technologies, and the impact of video networks as key drivers of sustained double-digit top-line growth." Cisco call option volume of 73,135 contracts compares to put volume of 46,830 contracts. Cisco February option implied volatility of 42 is above its 26-week average of 28 according to Track Data, suggesting larger near term price risks.

Nabors Industries Ltd. (NYSE:NBR) -- option implied volatility and volume increases as NBR rallies. Nabors is an owner and operator of almost 600 land drilling, approximately 791 land workover/well-servicing rigs and 43 offshore platform rigs worldwide. Nabors will report EPS on 2/7. Nabors is recently up .80 to $31.02 on unconfirmed LBO chatter. Nabors call option volume of 26,680 contracts compares to put volume of 2,895 contracts. Nabors March option implied volatility is at 38. Nabors February option implied volatility of 53 is above a level of 43 from twenty-minutes ago and above its 26-week average of 33 according to Track Data, suggesting increasing price fluctuations.

Option volume leaders today were: Cisco (CSCO), Google Inc. (NASDAQ: GOOG), Equity Office Properties (NYSE:EOP), NYSE Group Inc. (NYSE: NYX) and Amazon.com Inc. (NASDAQ: AMZN).

NYSE Group Inc. (NYSE:NYX), operator of the New York Stock Exchange, announced Wednesday it would form an alliance with the Tokyo Stock Exchange, the largest stock market in Asia.

Under agreement terms, the two exchanges will establish working groups that concentrate on technology, promotional activities and listings.

Wall Street's initial response was muted as analysts waited to see if the announcement would lead to a sharing of ideas or a complete inter-hemisphere stock exchange system. NYX already has plans to merge with Paris-based Euronext, which contains the Paris, Brussels and Amsterdam exchanges. NYX's shares drifted slightly lower on the news, down 47c to $100.28 in Wednesday afternoon trading.

A truly inter-continental stock exchange would need standardized symbols, execution, transparency and, equally significant, no major additional "fee" for those U.S. investors trading a Tokyo stock, and vise-versa.

Moreover, from a consumer standpoint, that last point is critical as similar to bank ATM fees, stock traders will shun excess charges/fees. Hence, until more is known regarding the NYSE/Toyko alliance's fee structure, traders, like analysts, will take a wait-and-see approach regarding the alliance's ultimate benefits.

MOST NOTEWORTHY: Notable companies from today's downgrade list include the New York Stock Exchange (NYX) and Nokia (NOK).

• JP Morgan downgraded the New York Stock Exchange Group Inc. (NYSE:NYX) to Neutral from Overweight based on valuation; they also foresee potential integration issues with Euronext.
• Nokia Corp. (NYSE:NOK) was downgraded to Hold from Add at West LB.

OTHER DOWNGRADES:

• YRC WorldWide Inc. (NASDAQ:YRCW) and Arkansas Best Corp. (NASDAQ:ABFS) were downgraded at Stephens to Underweight from Equal Weight, citing the deteriorating Less-Than-Truckload environment.
• Bear Stearns downgraded 3Com Corporation (NASDAQ:COMS) to Peer Perform from Outperform citing increased execution; Lehman Brothers downgraded 3Coms (COMS) to Underweight from Equal Weight.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Tonight on CNBC's MAD MONEY Jim Cramer was discussing NYSE Group, Inc. (NYSE:NYX).

He said there is an $87.00 stock that is going to $250.00 in the next two years: New York Stock Exchange. He said it is still noted by Wall Street as fully valued, but they are wrong. He said it doesn't even matter that it was up $5.00 today and you would wonder why it isn't up even more. He said there are no sellers of the stock. The specialists aren't selling, the old Archipelago holders aren't sellers. Cramer thinks a NYSE & Euronext combination could be huge.

Cramer said he was shocked at how quiet the floor was yesterday because it is thinning out. Cramer thinks the floorless trading is coming soon rather than later. he said the 500 worker cut this week was 17% of its workforce and they recently closed one of the five trading rooms.

Cramer enumerated the reasons he thinks the stock can get to $250:

1. hybrid systems rollout is speeding up trades
   
2. the exchange won't have to get into a bidding war over Euronext
3. while it was archaic and poorly run, it is now well-run, with massive improvements
4. Euronext savings will be $600 million
5. working deals in India and Japan, and
   
6. he hybrid system will help trim that $350 million in floor operation expenses.
   

He thinks it can earn $10 per share faster than he even thought a month ago, even though the street is only at $5.00 EPS for 2008.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in teh companies he covers.