Technology stocks continued to show strength on Wednesday with the Nasdaq closing up 28 points while the Dow struggled to close down 20 points. Poor housing numbers and record high oil prices continue to keep the markets at bay. CNBC's "Fast Money" panel tries to make sense of this market divergence.
reported a 72% decline in profits and the CEO says the housing slump isn't over. Karen Finerman believes the divergence between technology strength and financial weakness is sustainable as long as people have jobs. She is very nervous about future quarters for Washington Mutual. In Pete Najarian's opinion, the market digested the financial crisis too quickly and he expects to see future adjustments. On the flip side, he expects technology stocks to remain strong.
In other mortgage news,
was hit with a SEC informal investigation into stock sales by CEO Angelo Mozilo. Guy Adami points out that where there is smoke, there is generally fire.
Citigroup Vs. JPMorgan
on Wednesday with a better earnings report due to superior cost controls. CNBC's Charlie Gasparino joined the "Fast Money" crew to discuss his take on the big banks. Gasparino says the rumors are that Citigroup CEO Chuck Prince is out tonight. Citigroup is denying it, but Gasparino doesn't believe the denials. Too many senior executives at Citigroup are telling him that Prince is gone. Adami suggests that Citigroup could be a buy right now after 100 million shares traded on Wednesday at the 52-week low. Finerman is getting anxious to buy some Citigroup for a play on Prince leaving. Jeff Macke cautions investors that Citigroup could be a value trap.
Big pharmaceutical names like
are all set to report earnings on Thursday. Adami continues to like Pfizer on a valuation basis, plus it has a 4.6% dividend yield and tons of cash on the balance sheet.
for takeover plays. He maintains that the big pharmas with no pipelines will have to buy these names to capture growth. Najarian discloses that he doesn't own any of takeover plays he mentioned.
announced plans to lay off 2300 employees on Wednesday. Najarian is steering clear of stent makers like BSX and
(To see how a health care fund is performing, check out this portfolio on Stockpickr.com,
All eyes are on
ahead of the search giant's earnings report set for Thursday. According to Najarian, Google is the king of search and he thinks they've a great shot to report strong earnings. He owns Google and speculates that Google might launch a G-phone. The stock has the potential to reach the $700 level.
Adami predicts that we will see the first $1000 price target for Google in the next week. The time to sell Google will be when they go into the hardware business, so says Macke. Having said that, he emphasized that doesn't mean it's not going to $1000. Finerman loves the company but doesn't feel comfortable with the valuation.
Word on the Street
reports a large quarterly loss due to writedowns, but the stock jumps on a bullish outlook. Najarian says everything seems to be working for eBay. Macke advises investors to let it digest some gains, then look to buy eBay. Adami proposes trading off of the strong eBay outlook with
United Parcel Service
Goldman Sachs downgraded
. Finerman declares she has never seen Wal-Mart stock so cheap on valuation.
all exploded higher on Wednesday. Tim Seymour of Red Star Asset Management tells viewers that there is talk of merging the Shanghai and Hong Kong markets. This talk is moving the Chinese stocks. Seymour thinks lots of retail speculators and hedge funds are in these stocks and he cautioned having puts as insurance.
Pops & Drops
traded up 7% on strong earnings report. Manpower looks cheap to Adami around these levels.
traded up 4%. To Najarian, this is a strong stock.
traded up 3%. Finerman says the consumer is not dead and she sees good value in retail.
popped 8% off the strong earnings report from
. Macke advises riding it and likes the chips as the holidays approach.
fell 3% after Clearbridge Partners said they would vote against taking the cable operator private. Najarian thinks this stock could see $28 in the near future.
The crew gave their final trade ideas for the show.
- Even with a quarterly loss, Macke likes eBay (EBAY) - Get Report.
- Adami wants to short Exxon Mobil (XOM) - Get Report.
- Finerman would get long ConocoPhillips (COP) - Get Report.
- Najarian picks Evergreen Solar (ESLR) for the unusual options activity he noticed Thursday.
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