'Fast Money' Recap: Markets Spiraling Down

The markets plunged on concerns about the stimulus package and fate of the automakers.

The Dow Jones Industrial Average fell 297.81, or 3.79%, to 7,552.60, while the S&P 500 dropped 37.67, or 4.56%, to 789.17. The Nasdaq fell 63.70, or 4.15%, to 1,470.66.

Pete Najarian said on CNBC's "Fast Money" TV show that it's important for investors to buy protection in this tough market. "That's the only way you can sleep at night," he said.

Tim Seymour also told viewers to keep their portfolios "light and lean." Najarian cautioned investors not to blindly jump into the market in the belief that this might be a bottom.

Guy Adami said the S&P appears to heading toward 740.

Dylan Ratigan, the moderator of the show, asked the panel how they would trade off the stimulus package signed by President Obama today. Najarian said he liked energy names such as Energy Conversion Devices(ENER Quote), and First Solar(FSLR Quote).

Seymour liked PowerShares Water Resources(PHO Quote) as a water purification play.

Adami liked the prospects for URS(URS Quote), an engineering firm that gets 90% of its revenue in the U.S.

Najarian said China could offer an opportunity because $85 billion of its stimulus is going toward energy such as a power grid, coal fired plants, nuclear energy, solar energy and wind energy.

Ratigan said gold and health care stocks continue to work in this market. Najarian liked SPDR Gold Trust(GLD Quote) and Market Vectors Gold Miners(GDX Quote).

In the health care sector, he liked Medtronic(MDT Quote), which beat earnings, gained in some areas in the latest devices and enjoyed a 10% rise in its cardiovascular unit.