Lorillard (LO), which saw increasing volume and higher implied volatility yesterday, is down another $3.75 to $107.63 on volume approaching 2 million shares, which is more than double the normal. The two-day 5.8 percent skid pushed shares of the cigarette maker below a 200-day moving average and has motivated a flurry of activity in the options on the stock. 14,000 puts and 2,700 calls traded in the name. The flow includes a Feb 85 – 100 put spread, bought for 85 cents, 500X. Mar 110 – 115 put spreads traded at $3.15, 1000X, and appears to be opening (seller?). Today’s weakness in the stock might be in reaction to Altria’s earnings miss. LO reports on Feb 9. Implied volatility is up another 11.5 percent to 32 and has surged 60 percent during the past two days.