Hatteras Financial (HTS) is trading down $1.12 to $26.55, as the mortgage Real Estate Investment Trusts get slammed on US debt default fears Friday. Mortgage REITs invest some of their assets in mortgage securities guaranteed by the government agencies. Annaly Capital is the largest mortgage REIT (also see today’s NLY color). Meanwhile, HTS plummeted to a new 52-week low of $23.80 early and is now 11.6 percent off its worse levels. However, defensive trading continues and implied volatility in HTS options is sharply higher. 8,170 puts traded and 3,310 calls traded in the name so far. Aug 20, 25 and 26 puts are the most actives and implied vols have rallied more than 100 percent to 31.5.

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

Two big prints in EMC today, which is trading down 56 cents to $26.03. An 18,903-contract block of Jan 17.5 puts traded at 19 cents. Separately, a 16,015 Jan 20 puts traded at 36 cents. Both traded on ISE about an hour apart. Sentiment data from the exchange hints at a closing purchase (firm) in the 17.5s and opening in the 20s (crossed firm-to-firm). 41,000 puts and 7,400 calls now traded in the data storage device maker.

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

Interesting flow in the weekly options that expire next Friday and therfore include the potential US default event. On the stock side call buyers appear to dominate, with BAC 10 and 11 strike calls trading actively and AAPL and RIMM upside calls busy in offer-side flow with increasing IV. On the ETF side the volume is in the puts, with SPY 128 strike puts for 8/5 expiration leading the list and an early buyer paying 1.95 for nearly 8000 contracts on the CBOE.

American Axle (AXL) adds 51 cents to $11.05 after the Detroit-based auto parts maker reported quarterly earnings of 65 cents per share, which was 21 cents better-than-expected. A noteworthy options trade in AXL this morning is a block of 6500 Jan13 7.5 puts sold at $1 per contract. The position looks opening and probably a bet that shares will hold above $7.5 through Jan 2013.

Some optimism is brewing in Starbuck’s (SBUX) ahead of earnings. Shares are up $1.08 to $40.05 after Green Mountain Coffee Roasters (GMCR) surged 16.6 percent on better-than-expected results today. Options on Starbucks are actively traded as well. 36,000 calls and 21,000 puts traded so far. Eight of the ten most actives are August options and about 63 percent of the total volume is in the front-month. August 40s, which are now at-the-money, are the most actives. 7,450 traded against 4,638 in open interest. Aug 41 calls, Aug 39 calls and Aug 39 puts are the next most actives. Meanwhile, implied volatility in SBUX options is up about 13 percent to 36.5 and option prices currently suggest an earnings deviation of approximately 6%, or nearly $2 in reaction to the the news. The company reports after the closing bell, today.