Lincoln National (LNC) is down $3.96 to $6.41 after the life insurance company withdrew an appliation to the FDIC to issue debt under the Temporary Liquidity Guarantee Program, saying it doesn’t think it qualifies for the government program. Credit Suisse downgraded the stock to Neutral. In the options market, some traders appear to be bracing for further weakness, with active trading seen in April 7.5 and April 5 puts. Implied volatility in LNC options is up to 222, from about 165 late Friday.

Seagate (STX) is down 47 cents to $5.62 and puts are heavily traded Monday morning. 12,000 contracts so far, or about 10X the typical volume. It looks like sellers are dominating the action. For example, in the April 6 puts, the day’s most actives, 4,270 traded and 98 percent hit bid-side. Looks like sellers in May 6 and Jun 5 puts as well.

AstraZeneca (AZN) shares saw a spike about 10 minutes ago and are up 90 cents to $33.28 after the FDA said Bristol Myers (BMY)/AZN diabetes drug met guidance criteria. AZN options volume is running at 3X the average daily, with possible selling of May 35 puts and buying in April 35 calls. BMY is up 50 cents to $21.16 amid increasing interst in June 20 puts, and April and Sep 22.5 calls.

General Motors (GM) implied volatility is higher. Shares are down 26 percent after the White House said the automaker’s plans to secure more government funds are inadequate and asked that CEO Wagoner please step down. 35K puts already traded, about 10X the normal levels. Implied volatility is back up to 250 (from about 210 late Friday) ahead of event risk: President Obama speaks at 11:00 about the automakers and monthly auto sales numbers due on April 1.

Arena Pharmaceuticals (ARNA) April 5 call is the most actively traded equity options contract in the first 30 min. More than 10K traded. Shares are down 80 cents to $3.70 on the heels of Lorcaserin Phase 3 obesity trial results, which met primary efficacy and safety endpoints. It could be a case of buy the rumor, sell the news, as there had been a lot of bullish trading in ARNA over the past few weeks. It appears that April 5 calls are being sold. Implied volatility is getting crushed, (average) down to 205 from more than 350 late Friday.

SPDR Gold Trust (GLD) is up 81 cents to $91.50 and moving to session highs after gold reversed early losses. The precious metal is up $8 to $933.30. Trading is active, with 7000 GLD calls and 4,485 puts changing hands in the first 15 min.

Micron Technology (MU) May 4 calls are actively traded for a second time in three days. The contract topped the most actives Thursday morning. Today, shares are down 25 cents to $3.92 and 2,626 traded, compared to open interest of 5,849. Trades include a multi-exchange sweep of 2,030 contracts at the offer for 60 cents. Earnings expected on April 2 (unconfirmed).

37000 calls and 14000 puts traded on Qualcomm (QCOM) Friday. Shares finished down 60 cents to $38.94 and the top trades of the day included 5000 Jan-2010 40/50 call spread trades 5000X for $3.60 on PHLX. It appears the trade was buyer initiated and created new open interest. If so, it is a bullish spread with a max pay-off (excluding commissions) of $6.40 if QCOM rallies to $50 or more by the January 2010 options expiration.

Stocks set to follow overseas markets lower, with worries about the autos, the banks, and G-20 weighing on early trade. Read More.

Fidelity National Financial (FNF), a Jacksonville, FL-based title insurance company, saw bearish order flow Friday. Shares fell 4.3 percent to $18.77 and 1,300 puts traded, compared to 195 calls. The activity was mostly in May and June puts at the 17.5 and 15 strikes, with more than 90 percent of the volume hitting ask-side and creating new open interest of 1,205 contracts in FNF puts.