'Fast Money' Recap: Yahoo! Stays in Play

The U.S. stock market showed some vigor Wednesday, closing to the upside on a decent inflation number and less-than-disastrous news from the financial sector. The Dow added 0.5%, the S&P 500 climbed 0.4%, and the Nasdaq ticked up 0.1%.

On CNBC's "Fast Money" TV show, the traders discussed billionaire investor Carl Icahn's after-hours decision to pursue a proxy battle to extract value from Yahoo! (YHOO). Microsoft (MSFT) recently walked away from an acquisition of the Internet company.

Finerman said that the risk/reward on Yahoo! is not fantastic at this level. She said that the stock has already risen because investors thought Icahn would join the fray. There's more certainty now that Icahn has officially joined the battle, but there's no certainty that Microsoft is still interested in buying, she said.

Macke said he believes Icahn will win the proxy battle. Microsoft will return to Yahoo! at some price, he said.

The traders discussed Icahn's pursuit of a 12-member slate for Yahoo's board, meaning he's seeking a full slate. Finerman said that a full board is much harder to win than a half board, because proxy advisory firms have a harder time condoning elimination of an entire board. She said this means there's higher risk that a deal will not get done.

Najarian said it's important to make sure Microsoft is still interested. He said he believes that because of the stock, Microsoft will still want to do a deal. He took off half of his Yahoo! position today, he said.