The market made small gains Thursday, but took time to hold on the huge gains over the previous two trading sessions. Third Quarter Gross Domestic Product was revised higher to 4.9%, up significantly from the 3.9% estimate released earlier. While it will take some time to work through all of the issues related to the credit crunch, 4.9% GDP indicates an economy that is firing on all cylinders and one nowhere near a recession.

The NYSE had volume of 3.5 billion shares with 1,472 shares advancing while 1,779 declined for a loss of 17.48 points to close at 9,773.57. On the NASDAQ, 2.1 billion shares traded, 1,376 advanced and 1,638 declined for a gain of 5.22 to 2,668.13.

Stocks moving Thursday included Sears Holdings (NASDAQ: SHLD), which fell $12.25 (-11%) to $104.09 as earnings fell. CIT Group (NYSE: CIT) lost $2.24 (-9%) to $24.00. Countrywide Financial Corp (NYSE: CFC) rose $0.58 (7%) to $9.30. Smithfield Foods (NYSE: SFD) rose $1.39 (5%) to $29.57 on earnings.

In options there were 4.9 million puts and 5.3 million calls traded for a put/call open interest ratio of 0.92. Sirius Satellite Radio (NASDAQ: SIRI) saw heavy volume on the January 4 calls (QXOAH) with over 48,300 options trading. Sirius Satellite Radio (NASDAQ: SIRI) moved 33,700 of the March 4 calls (QXOCH). E*Trade Financial (NASDAQ: ETFC) saw heavy volume on the January 7.5 calls (EUSAU) with over 36,300 options trading. E*Trade Financial Corp. (NASDAQ: ETFC) also had heavy volume on the December 5 (calls (EUSLA) with over 22,500 options trading. Mirant (NYSE: MIR) saw very heavy volume on the January 40 puts (MIRMH) with over 148,900 options trading; there was also very heavy volume on the Mirant (NYSE: MIR) March 40 puts (MIROH) with over 125,200 options crossed.

Kevin Kersten is an Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

The markets continued to work mildly higher as more investors had a chance to react to yesterday's interest rate cuts. There may be some upward pressure on the markets though the end of the week.

The NYSE had volume of 3 billion shares with 2,160 shares advancing while 1,155 declined for a gain of 61.87 points to close at 9,970.9. On the NASDAQ, 2.1 billion shares traded, 2,005 advanced and 1,006 declined for a gain of 14.82 to 2,666.48.

In options, there were 6.4 million puts and 8.6 million calls traded for a put/call open interest ratio of 0.75. The heavy call activity indicate a more positive outlook on the market. General Electric (NYSE: GE) saw heavy volume on the September 40 calls (GEIH) with over 977,900 options trading; likewise the September 37.50 calls (GEIS) with over 638,900 options trading. This excessive high volume is dividend arbitrage as funds grab the stock to get the $0.28 dividend coming tomorrow.

PowerShares QQQ Trust ETF (NASDAQ: QQQQ) traded heavy volume on the September 50 calls (QQQIX) with over 118,300 options trading and the September 49 calls (QQQIW) with over 77,300 options trading. Altria (NYSE: MO) moved heavy volume on the October 70 calls (MOJN) with over 48,000 options trading. Goldman Sachs Group (NYSE: GS) saw heavy volume on the September 210 calls (GPYIB) with over 47,000 options trading. Financial Sector SPDR ETF (NYSE: XLF) saw heavy volume on the September 35 puts (XLFUI) with over 34,100 options trading.

Kevin Kersten is an Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.