Potash (POT) is up $9.32 to $126.25 and POT options are seeing brisk trading after the company increased its first quarter earnigns guidance to $1.30 - $1.50 per share, from .70 to $1.00. 17K calls and 5660 puts traded on POT so far. The top trade looks like an April 100 - 125 strangle, bought at $7.83, 400X.

Stocks are indicated higher with help from better-than-expected retail sales data Friday. Thirty minutes before the opening bell on Wall Street, stock index futures indicate that the Dow Jones Industrial Average might add 30 or 40 points at the open.

Stock index futures rallied after the Commerce Department reported that retail sales rose .3 percent during the month of February. Economists were expected the report to show a .2 percent drop. Excluding autos, sales rose .8 percent vs. .1 percent consensus.

The positive data sent stock index futures higher, but bonds lower. The benchmark ten-year Treasury is down 7/32nd and now yields 3.75 percent.

The dollar added .43 to 90.93 against the Japanese yen. The euro edged up .0067 to 1.3745 against the buck.

A report on consumer confidence is due at 9:55 eastern time. Economists expect the University of Michigan to improve to 74.0 in March, up from 73.6 the month before. A report on Business Inventories follows at 10:00. A reading of .1 percent is expected.

Energy, metals and mining names might see some early strength after crude oil added 81 cents to $82.92 a barrel and gold gained $6.2 to $1114.4 an ounce.

Among the other stocks to watch, National Semiconductor (NSM) shares rose 2.5 percent after the chipmaker posted a quarterly profit of 22 cents per share, which was four cents better than Street estimates. The fertilizer names are in focus after Yarra dropped its bid for Terra Industries (TRA) and Agrium (AGU) terminated its offer for CF — which sent CF and TRA shares lower, but AGU shares 6 percent higher. Apple Computer (AAPL) ticked up after its online store went down, which sometimes happens before a product announcement and or update.

Some less actively traded names seeing bullish order flow: Polycom (PLCM), Phillips Van Heusen (PVH), GMXR (also pre-earnings) Bearish order flow: Savvis (SVY), Intersil (ISIL), Varian Semi (VEA) Post Earnings: IMAX, Clean Energy Fuels (CLNE), ATP Oil and Gas (ATPG) Pre-Earnings: Ann Taylor (ANN), National Semi (NSM), Aeropostale (ARO) Ex-div.: Navios Maritime (NM), Burger King (BK), Mercury General (MCY)

Cheesecake Factory (CAKE) touched a new 52-week high and was recently up 60 cents to $26.63. Options volume is running 10X the average daily, with some unusual activity seen in July and October puts. A total of 20K puts traded, compared to 2290 call options. July 22.5s are the most actives. 7723 traded (89 percent ask). The top two trades were 607 and 594 contracts at 65 cents. July 20 puts are trading 92 percent on the bid and so some of today’s flow might be spreads. July 25, 17.5, Oct 20, and Oct 17.5 puts are seeing interest as well, with volume exceeding open interest in all six contracts. No news today. CAKE was the subject of a downgrade Tuesday (MKM Partners to Neutral). Implied volatility is flat around 35 percent.

Terra Industries (TRA) is off 10 cents to $46.85 and an investor pays 30 cents for the Mar 45 - 46 put spread, 15000X. It might roll a position up in strikes, but seems like a defensive play. CF Industries (CF) has started its exchange offer for TRA common stock at $37.15 in cash plus .0953 of a share of CF. CNBC’s Faber said yesterday that Yara’s Board of Directors is meeting today to see if they want to revise, perhaps top, CF’s bid. They have 5 days to do so. The put spread is likely a short-term hedge should, for whatever reason, the buyout fall apart. March options come off the board at the end of next week.

Interest in Citi (C) calls continues. 1.47 million traded in the name yesterday, creating 223,000 contracts in new open interest. Today, shares are up 6 cents to $4.02 and one player pays 10 cents for June 5 calls, 50000X. 240K calls and 66K puts traded in Citi during the first 30 minutes Thursday.

Stocks are set to open lower on disappointing weekly jobless claims data Thursday. Thirty minutes before the opening bell on Wall Street, stock index futures indicate that the Dow Jones Industrial Average might lose 25 or 30 points at the open.

Stock index futures slipped after the Labor Department said weekly jobless claims fell by 6,000 to 462,000 in the first week of March. Economists were looking for a decline to 460,000. Continuing claims for the end of February increased to 4.558 mln from 4.521 mln and more than the 4.5 mln economists were expecting.

Separate data showed the Trade Balance narrowing to $37.3 billion in January, down from $39.9 billion in December thanks to falling imports. Economists were looking for a wider $41 billion deficit.

Bonds are modestly lower, but off morning lows on the poor economic data. The benchmark ten-year Treasury is down 2/32nd and now yields 3.73 percent.

The dollar is flat at 90.49 against the yen. The euro edged down .0011 to 1.3643 against the buck.

Energy, metals and mining names might see early weakness after crude oil lost 58 cents to $81.51 a barrel and gold shed $4.4 to $1103.70 an ounce.

Among the other stocks to watch, Mens Wearhouse (MW) shares fell 7 percent after the company reported a fourth quarter loss on lower sales and write-downs. Hott Topic (HOTT) also slipped on earnings news. Fuel Cell (FCEL) gained 5 percent after the company reported in-line earnings and also announced a new $2.1 billion contract. National Semi (NSM) might see some action today ahead of earnings, due out after the closing bell.

Oil refiner Valero (VLO) is up $1 to $20.53 and options trading is brisk Wednesday, with 33,000 calls and 19,000 puts on the tape so far. The gains in the shares and the heightened options activity comes the day after Reuters reported that PBF Investments might be interested in buying VLO’s Paulsboro refinery in New Jersey. Shares are now not far from session highs and the options action is really scattered: March 20 calls, March 20 puts, Sep 23 calls, Sep 25 calls, April 21 calls, Mar 19 calls, Jan11 20 puts, Mar 21 calls, June 18 calls. Meanwhile, implied volatility is up about 2.5 percent to 32.

CBOE Volatility Index (.VIX) is up .29 to 18.21 and looking to extend this week’s winning streak. After falling during 17 of 18 trading sessions, VIX is up 4.5 percent since Friday and might be seeing some strength due to upcoming expirations — VIX options a week from today and then the “Quadruple Witch” next Friday. In the options, noteworthy trades in the VIX today include two large blocks totaling 80K May 35 calls on the bid of 45 and 50 cents per contract. These blocks printed in morning action and, since it looks opening, might reflect expecations that VIX is unlikely to make a signficant move higher by the VIX May expiration (69 days.)

Kinetic Concepts (KCI) is halted, news pending ahead of a trial verdict against Smith and Nephew. Shares are up 68 cents to $43.99 and options were active ahead of the halt, with 16K puts and 7500 calls traded. The top trades: 4700 and 4600 March 40 puts on the bid, 75 cents per contract. Looks like put sellers. Another player sold 1750 Mar 50 calls at an average of 37.5 cents. Implied volatility is up about 6 percent to 78.