Schaeffer's Daily Market Blog Features: AutoNation, Family Dollar, CBOE Market Volatility Index, Bob Evans, and DaimlerChrysler.

CINCINNATI -- Among the stocks featured in the September 28 edition of Schaeffer's Market Blog are AutoNation (NYSE:AN), Family Dollar (NYSE:FDO), CBOE Market Volatility Index (CBOE:VIX), Bob Evans (NASDAQ:BOBE), and DaimlerChrysler (NYSE:DCX). Schaeffer's Market Blog is just one of the many free market commentaries written every day at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. To have this report delivered to you free via email every day click on the following link and you'll also get an opportunity to win an iPod Nano. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB13M&PAGE=1

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11:40 AM AutoNation (AN) Upgraded

AutoNation (NYSE:AN) received a boost this morning when Bear Stearns upgraded the firm from "peer perform" to "outperform." The brokerage firm cited lower financing costs and attractive valuation. Furthermore, analyst Michael Geoghagan stated that production cuts at the Big 3 auto makers -- General Motors, Ford Motor and DaimlerChrysler -- could be a positive for AutoNation "to the extent that leaner inventory reduces floor-plan (inventory) financing costs and supports higher transaction prices (because of less pressure to liquidate)."

Technically speaking, the shares have jumped more than two percent this morning on the positive comments, pushing them through former resistance at the 20.80 level. What's more, the stock has skipped above its declining 20-week moving average, which it has logged only one weekly close above since mid-May.

1:17 PM Family Dollar Looks to the Future

In early-afternoon trading, Family Dollar (NYSE:FDO) shares have dropped more than three percent as shareholders digest the discount retailer's latest earnings report. This morning, the firm announced fourth-quarter earnings of $38.8 million, or 26 cents per share, up from year-ago results of $29.2 million, or 18 cents per share. This topped analysts' consensus per-share estimate of 23 cents. Sales increased 10.3 percent during the reporting period to $1.58 billion, while same-store sales jumped up 4.8 percent.

For the first quarter, FDO expects to earn between 34 and 38 cents per share, surrounding analysts' consensus view of 37 cents. Same-store sales are expected to rise between two and four percent during the current period. For fiscal-year 2007, FDO expects per-share results of $1.57 to $1.69, amid higher transportation costs and a gradual mix toward lower-margin consumable merchandise that will impact the retailer's gross margins.

Today's pullback initially forced FDO shares below their 20-day moving average but the stock has now retaken control of this trendline and is sandwiched between this and its 10-day moving average.

1:55 PM Betting on Increased Volatility

Call options on the CBOE Volatility Index (CBOE:VIX) are quite popular today, as nearly 30,000 contracts just at the November 15 strike have been traded thus far. There is little-to-no put option activity on the VIX. This is a large bet on an increase in volatility, which usually means a sharp drop in the broader market. As the market declines and people rush out to buy put option protection for their portfolios, the VIX increases. The current VIX reading is 11.84. I've noticed in the past, these types of plays tend to be "smart money."

3:04 PM Where'd You Go to Lunch?

Today I went to lunch at Bob Evans (NASDAQ:BOBE), so now I want to take a look at this one a little closer. First off, the food was great and we waited for 15 minutes, and the place was packed - so things must be going pretty good on the fundamental side. Looking at the stock I can see the results, as the shares are up near their highs set back in March and up about 20 percent since early August. Interestingly, there aren't any options on this one, nor any analyst ratings. To me this shows there's a good deal of money still left on the sidelines from these two influential groups. One bit of skepticism can be found from the shorts, as they're all over it; it would take nearly eight days for them to cover all of their shorted positions.

3:17 PM Sales News from DaimlerChrysler (DCX)

Following the lead of some of its peers, Chrysler Group, which is the U.S. arm of DaimlerChrysler (NYSE:DCX) , is reducing its vehicle sales outlook of 2006 as it now expects to sell fewer cars than it did in 2005. The firm's head of sales and marketing, Joe Eberhardt broke this news to Dow Jones during an auto show in Paris.

During the first eight months of 2006, combined sales of the Chrysler, Jeep, and Dodge brands declined 10 percent to 1.459 million vehicles. Eberhardt observed that "On the whole year, we believe that the decline will be less than 10%, with stabilizing sales in the remainder of 2006." Looking forward, he noted that 2007 sales should be strong than the final numbers this year, thanks to the rollout of eight new models with the low-fuel feature that is currently all the rage. Due to this altered outlook, DCX now expects profits of EUR5 billion instead of EUR6 billion.

While DCX shares gapped lower out of the gate, they have spent most of Thursday fighting back and are within half a percent of breakeven as we trek toward the close. The stock is still hovering above long-term support at the 50 level, a former site of resistance throughout 2004 and during the first half of 2005.

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