i expect some fireworks on the dow tonight

Oct. 17 (Bloomberg) -- The U.S. stock market's wildest swings since 1929 may get even bigger as almost 80 million options expire today.

Owners of the contracts on stocks, indexes and exchange- traded funds have until today's close to take advantage of the rights granted by the calls and puts they own. Investors are preparing for the possibility that market makers will boost volatility by buying and selling stock to hedge the risk of the option trades they have facilitated, according to Scott Nations, president of Fortress Trading Inc.

``I'd expect some fireworks,'' said Herb Kurlan, president of Vtrader Pro LLC, a San Francisco-based options and futures brokerage. ``The unwinding of positions is going to be more pronounced because of the high volatility.''

About a quarter of the approximately 337 million existing options expire today, according to Chicago-based Options Clearing Corp., which settles all trading of exchange-listed contracts and is the world's largest derivatives clearinghouse.

The Standard & Poor's 500 Index moved more than 1 percent in 10 of the 12 trading sessions in October, or 83 percent of the time, amid concern the global economy will enter a recession. That puts the benchmark index for U.S. stocks on track for the biggest swings since November 1929, when gains or losses of at least 1 percent occurred 88 percent of the time, according to S&P analyst Howard Silverblatt.

The most widely owned S&P 500 options expiring this week are October 1,150 puts. The S&P 500's 18 percent retreat from that strike price profited buyers of those contracts, which increased almost sixfold in value this month. Even after yesterday's 4.3 percent surge, the index has slumped 22 percent in three weeks.