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

Microsoft (MSFT) shares are up 2.5 percent to $24.80 and leading the Dow Jones Industrial Average to a modest three-point midday gain after fund manager told an audience at an Ira Sohn conference last night that the software company’s board should oust CEO Steve Ballmer. Options on Microsoft are seeing brisk trading as well. June 24 calls, which are 80 cents in-the-money and expiring in three weeks and one day, are the most actives. Volume is more than 19,000 and probably seeing some closing trades following the advance in the share price. June and Weekly 25 calls are the next most actives, as some players might be initiating positions on hopes the gains can continue ahead of the Memorial Day weekend and over the next few weeks. However, shares face resistance just north of current levels, which corresponds to a recent low seen on April 19 ($24.87) and a recent high ($24.88) from May 19.

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

Tiffany (TIF) shares surged $6.20 to $76.24 after the company reported better-than-expected first quarter earnings and raised guidance for the 2012 fiscal year. Options action is picking up as well, with 12,000 calls and 15,000 puts traded in the New York-based jeweler so far. The volume represents 9X the average daily. Jun 75 calls, which are now $1.24 in-the-money, are the most actives. 2,650 traded against open interest of 2,074. The top options trades are on the put side of the options chain after an investor initiated a Jun 70 – 75 put spread at $1.12, 540X on ISE. Looks like a bearish short-term play or perhaps to hedge some of today’s gains in the stock.

El Paso (EP), which prior to today saw an 11.2 percent two-day rally on news it was splitting into two companies, is off 43 cents to $20.68. In early options action, one investor takes a position in the July 20 buy-write while buying Jul 17 puts, 6000X. Looks like an opening collar with a potential of 2.4 percent gain if shares hold above $20 through the July expiration. Shares were bought at $20.80 and $1.26 collected on the risk-reversal.