The Dow fell 50 points after Citigroup took down the financial sector again on Monday, and the team at Fast Money took a look at the implications for the broader market. Also on Monday's show: ethanol plays, the IACI breakup, one hot China stock, and more.
fell 5% Monday on news of more write-downs and CEO Chuck Prince's departure.
Charlie Gasparino joined the "Fast Money" crew to give his opinion on Citigroup. Gasparino says Citigroup didn't pop on the news of Prince leaving because Chairman Robert Rubin didn't articulate the new Citigroup vision that everyone on Wall Street was looking for.
He remarked that JP Morgan Chase CEO Jamie Daimon could run Citigroup and if he took the job, then the stock would rise. On the other hand, if they bring in NYSE Chief John Thain, Citigroup will be broken up. If Citigroup puts someone from inside the firm in charge, he predicts that nothing good will happen.
In Macke's opinion, Citigroup has to clear the deck and bring in somebody new to run the company. Gasparino also hints that
( BSC) CEO Jimmy Cayne will be out of a job within six months if BSC takes a big write-down. Macke says if you're looking for a bottom on Citigroup it will continue to be hard to find.
Chartology with John Roque
Technical analyst John Roque of Natexis Bleichroeder joined the "Fast Money" crew to give his analysis on the technical signs in the market. The S&P 500 sends signals that it has risk to the downside to the 1450 level. Roque still likes the longer term trend line on the S&P moving average.
He predicts the financials will be under performers for a long time. Roque points out that the trend for oil, silver and gold remains up and if history is a guide that up trend will continue. He's positive about
and thinks the stock can trade to the high $80s. Finerman advises viewers that if they want to make a gold bet -- just buy gold and don't take on the risk of the individual gold stocks.
Archer Daniels Midland
is set to report earnings on Tuesday before the open. Najarian tells investors to stay away from Archer and look to at
. Adami suggest that Archer is an ethanol play that nobody wants anymore. He would rather be in
for an ethanol play.
(Here's how one portfolio manager designed his ethanol list on Stockpickr.com,
announced plans Monday to split up into 5 separate companies. Also,
( KFT) is looking to sell its Post cereal business for $2.8 billion. Finerman is happy with the news out of Kraft. Macke likes Kraft's plans, but he wasn't a big fan of IAC/InterActive's plans to spin off divisions.
He hints IACI was just looking to make headlines with the news to catch a quick spike in the stock. Najarian muses that
Johnson & Johnson
could benefit from a break up.
announces plans to create an open platform, Android, for the mobile-phone market. Najarian concedes Google is unbelievable and the stock continues to perform, but he did lighten up on some Monday.
( JAVA) falls after hours on lighter-than-expected revenue numbers. For Macke, companies like
and its technology could put JAVA out of business in the future.
announced plans Monday to buy virtualization software maker EqualLogic for $1.4 billion. Adami really loves DELL after this acquisition. Najarian agrees that it's a great acquisition.
reports a second quarter profit as revenue soars, but the stock trades lower after hours. Macke notes that Activision crushed the numbers and he is still long the stock.
Guy Adami points out that
made a 52-week high on Monday and he believes it looks great above 26. Najarian says don't try and find the bottom on the financials, but instead look at technology stocks like Intel and
Word on the Street
CEO Richard Parsons will step down on Jan. 1 and be replaced by Chief Operating Officer Jeffrey Bewkes. Adami continues to be bullish on Time Warner and he thinks the $17-$17.50 area is the floor. He believes if they beat earnings on Nov. 7, TWX will go much higher.
Retail stocks continue to slide ahead of the all important same-store sales numbers set for Thursday. Finerman likes the retail stocks better than financials. She bought call options on Friday and Monday on
She also believes
Dick's Sporting Goods
are interesting here. Najarian suggests easing into Crocs on the long side, reminding investors they don't have to be the first one in the boat.
tops $1 trillion in market cap surpassing
. Adami likes that
preformed okay in a lousy tape today. He thinks Exxon Mobil is still expensive and mentioned that Warren Buffett sold his entire stake in PetroChina.
(Keep on eye on Buffett's changes on Stockpick.com at
Pops & Drops
traded up 10% after hours on news of a $1 billion module supply contract. Najarian says solar is the real deal and for weeks has stated that
is a good way to play the sector.
( MVL) traded up 16% on a strong profits report. Macke says Marvel crushed on every metric and you have to be long the super-hero stock.
traded up 4% off a positive article in Barron's this weekend. Macke still likes
more and he is currently long HAS. He believes Mattel just saw a Barron's bounce here.
Ballard Power Systems
traded up 12% on fuel-cell asset talks with Daimler and
. In Najarian's opinion, Ballard is in the right spot at the right time and that's why it popped.
WellCare Health Plans
popped 22% on a 67% increase in profits. Finerman tells investors to stay away.
traded up 2% after reporting a 16% rise in profits. Adami says it was a solid quarter but feels the stock is priced for perfection at these levels.
fell 2% and 3% after Deutsche Bank downgraded both stocks. Deutsche Bank is a bit late to the party, if you ask Adami.
fell 11% after a fraud watchdog group accused the company of shady business practices in China. Najarian declares if they're cheating, they should be penalized.
fell 4% after a private equity firm that controls 58% of BKC announced plans to sell 23 million shares. Macke notes that it will take awhile to digest the float.
The crew gives viewers their best ideas for the show.
- Macke recommends buying Cisco (CSCO) - Get Report at the open and selling it at the close.
- Adami recommends buying Time Warner (TWX) .
- Finerman advises going long Goldman Sachs (GS) - Get Report and shorting Lehman Brothers( LEH).
- Najarian believes a good trade is to buy put options on MBIA (MBI) - Get Report.
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