It sounds like something is running in the background, did you check to see if there are any applications running? CTRL/ALT/DELETE, applications.
Just started doing this today every 10-20 seconds the circle appears next to the cursor for about 5 seconds. Only does it when the arrow cursor is on the screen, not when I hover over letters and have the bar. It does it on Firefox, Opera and the desktop. Ran anti-virus & did a system restore to no avail. PC seems to be running normal otherwise. I'm using Windows 7 BTW. Thanks in advance.