'Fast Money' Recap: Ken Lewis Trade

Crude prices surged by the end of Wednesday's regular session on the New York Mercantile Exchange and this got the panelists talking commodities.

Joe Terranova said money mangers will likely allocate money in the fourth quarter to commodities such as oil, copper and sugar, which Terranova himself bought Wednesday. He added that oil ETFs will likely perform just as well in the fourth quarter as crude futures.

Gold, meanwhile, again broke the $1,000-per-ounce mark, leading Terranova to remark that he bought some gold futures during the session, albeit for less than $1,000. He said that all the news lately has given gold prices every reason to decline, and yet the yellow metal has held steady. He views this as a bullish sign.

Guy Adami disagreed, saying that one could make the same argument the opposite way. "It had every reason to go up, and hasn't." For now, he agreed, the signs do point north for gold. But, he added, "It does scare me, though."

Options expert Jon Najarian appeared as a guest to make some "fallen angel" picks: downtrodden stocks that could spike in the fourth quarter. He recommended three: including Leap Wireless(LEAP), whose stock has declined 41% in the third period; Synaptics(SYNA), a maker of touch-application technology for computers and smartphones, whose shares have lost 35%; MEMC Electronics(WFR), a solar play that was hammered in the quarter.

Najarian added that options trading in Leap has been active of late, perhaps as takeover speculation heats up in the tech sector.

Biotech Watch

Swine flu has produced interest of late in biotech and pharma stocks. CNBC biotech reporter Mike Huckman said BioCryst(BCRX) is moving its antiviral drug into late-stage studies, and that the big vaccine producers Novartis(NVS), Sanofi(SNY) and AstraZeneca(AZN) have already begun shipping their products. But, he noted, investors are more interested in drugs with long-term commercial potential. To that end, he said, Novartis has a new multiple sclerosis pill that has potential.

For his part, Terranova said he likes Abbott Labs(ABT) and Gilead(GILD), inventor of the antiviral flu drug Tamiflu.

In the "Final Trades" portion of the show, Terranova recommended Frontier Oil(FTO). Guy Adami mentioned Vertex Pharmaceuticals(VRTX), which said after the bell that it plans to begin a mid-stage study of its treatment for rheumatoid arthritis. Finerman said, "It's sort of the stock of the day; I'll go with it. BofA, long." And Steve Grasso gave a nod to Disney(DIS). His rationale? "My daughter Emily loves Mylie Cyrus."

-- Written by Scott Eden in New York

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