Options: Heat At Morgan Stanley, BSC and Oil

Will Morgan Stanley be the next financial company on the Wall Street hot seat?

Rebecca Darst of Interactive Brokers thinks that might well be the case.

"We're gearing up for a lot of activity in the brokerage space ahead of next week," Darst explained.  "We've got the Fed meeting next week, we've got brokerage earnings out next week."

And, she says, there's a big fight shaping up at Morgan Stanley.

"An activist investment group, CTW Investment Group, which represents union members with $1.4 trillion in assets, has begun lobbying shareholders, urging them to vote down John Mack as the chairman of the board of Morgan Stanley at the next shareholder meeting on April 8," she said.

Darst sees this scenario playing out differently in the options space than earlier CEO crises at Citigroup and Merrill Lynch did.

"What we would see in the options market would be interest in call buying," she said.  "We're not seeing that at Morgan Stanley."

She also had observations about consistent activity in Bear Stearns . "And incredible amount of speculative downside trading," she noted.

Darst also noted that an ETF, US Oil Fund , had been seeing activity as well.

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