Some less actively traded names seeing bullish order flow: Hudson City Bancorp (HBCK), New Gold (NGD), Eastman Chemical (EMN) Bearish order flow: Pride International (PDE), Frontier Communication (FTR), Polaris Industries (PII) Post-Earnings: Autozone (AZO) Pre-Earnings: American Eagle (AEO), Toll Brothers (TOL), Diana Shipping (DSX) Ex-div.: None

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

iShares South Korea Fund (EWY) is down $2.48 to $41.04 amid escalating military tensions on the Korean Penninsula. North Korean leader Kim Jong Il has ordered military to combat alert and tensions have been building since international investigators said that Pyongyang was responsible for the deadly sinking of a South Korean warship two months ago. The options action is interesting. The top trades include Jun 44 – 48 call spreads apparently bought-to-open at 90 cents on the ISE and seem to be bullish short-term plays on the ETF. The spread has traded more than 11,500X. Meanwhile, another player appears to be bracing for additional volatility and paid $6.45 for July 41 straddle, 5000X (was tied to shares at $41 on a 5 delta)

The top options trade so far today is a block of 66,962 Freddie Mac (FRE) Oct 1 puts bought at 25 cents. 70K now traded vs. 72K in open interest. The action likely closes out a position accumulated from late Feb to late April. The most recent is 20K on the 6-cent bid on April 29. Shares are down 3 cents to $1.16 today and down almost 25 percent since then. Another 20K were apparently sold-to-open at 7 cents on Mar 25.

Petrohawk (HK) is off 38 cents to $17.17 and 13,735 Jun 17.5 calls traded. Most traded on the bid at prices ranging from 76 to 87 cents, on PHLX. Open interest is 10.6K and some investors might be selling-to-open. Doesn’t look tied. Implied volatility (average) is up about 3.5 percent to 63.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Global equity markets are reeling and stocks are indicated sharply lower on Wall Street Tuesday. Thirty minutes before the start of trading in New York, index futures indicate that the Dow Jones Industrial Average might lose more than 200 points and drop below 10,000 at the open.

Markets in Asia were hit hard amid saber rattling between North and South Korea. North Korean leader Kim Jong Il has ordered military to combat alert because of increasing tensions on the Korean peninsula. Unrest has been building since international investigators said that Pyongyang was responsible for the deadly sinking of a South Korean warship two months ago.

Japan’s Nikkei and Hong Kong’s Hang Seng both lost more than 3 percent. South Korea’s Kospi fell 2.8 percent.

Meanwhile, in Europe, another round of losses are being suffered as the euro tumbles on worries about the ongoing debt crisis. European regulators warned that euro-zone economic growth might stagnate without the help from fiscal stimulus. The problem is, heavy debt loads make aggressive government stimulus impossible for many European countries.

France’s CAC 40 Index is down 3.3 percent. Germany’s DAX and UK’s FTSE both fell 2.7 percent. The euro is down .0144 to 1.22 against the dollar.

Crude oil slipped $3.00 to $67.21 a barrel. Gold lost $1.6 to $1192.40.

Flight-to-safety is lifting bonds. The benchmark ten-year Treasury is up 21/32nd and now yields 3.12 percent.

A report on consumer confidence is due out at 10:00 a.m., but with the focus on overseas markets, the domestic news is not likely to be much of a factor. Economists expect a reading of 58.3 in May, up from 57.9 from the month before.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume