The stock market continued to slide Thursday with the Dow plunging 200 points before a late day rally brought on by the banks helped push the averages up. The Dow finished down 33 points and the Nasdaq down 63 points. The team at CNBC's "Fast Money" did a post-mortem for investors.
Pete Najarian feels investors should stay away form the market for awhile. He thinks the carnage will last for a few more weeks. Tim Seymour suggests that hedge funds in the market think there is a "plunge protection team" sponsored by the Treasury Department that come in and buys S&P 500 futures whenever the market is down big. Guy Adami still thinks the overall market is setting up to go lower. For Karen Finerman, days like Thursday are very hard to trade and that is why she always owns puts.
Have Banks Bottomed?
Bank stocks like
recovered in late trading Thursday.
Charlie Gasparino joined the "Fast Money" crew to discuss his take on the bank stocks. Gasparino doesn't think the worst is over for Citigroup. He explains that nobody knows what these banks have on the books, or what these banks are going to mark down in the future. Even worse is Citigroup's management, which nobody on Wall Street has any confidence in, according to Gasparino. Ultimately, Citigroup needs a real manager to come in and break it up.
Gasparino next tackled
American International Group
. He described how former CEO Hank Greenberg wants to take over AIG and put his people in charge of the insurance giant. Greenberg wants to see AIG take on more risk and Gasparino hints not to underestimate him.
The four horseman of technology were crushed Thursday, with
Research In Motion
falling 6% and
falling 4%. Najarian tells investors they have a little room before they can step into Apple. In Seymour's opinion,
looks pretty good here and the firm has moved lots of business abroad. Adami says if you want to play tech look at
. He thinks the story for both is far from over.
Speculation made the rounds on Wall Street Thursday that
might looking for a new takeover target after
rejected BHP's takeover offer that would have created a $350 billion mining behemoth. Seymour remarks that potential targets are:
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Where are the Shoppers?
Retailers reported the worst October same-store sales numbers since 1995. Finerman maintains that retail still has some value and she prefers firms that have strong balance sheets. Companies to consider would be
On a Positive Note
profits rose 12% on ESPN and US theme parks. Adami mentions the stock is cheap and likes it here. It's a Bob Iger story.
beats third quarter profit expectations and the stock soars 16% after hours. For Najarian, it was the upside guidance that was great and that is why PCLN is popping after hours.
iShares MSCI Emerging Markets Index
bucks the market weakness and closes up on the day. Seymour explains the EEM was pushed higher by a huge oil discovery at
and news of acquisitions at Russia's Gazprom. He points out that Russia, South Africa, and Brazil all look cheap in the emerging market space.
explodes 28% higher after killing Wall Street expectations. The entire solar complex rallied along with FSLR Thursday. Najarian has now sold
into the solar strength. At this point, the solar stocks are beginning to get to over-heated. Adami advises taking profits in
, which traded twelve times normal trading volume. Najarian mentions that
Energy Conversion Devices
is getting away from fuel cells and going after solar cells. He thinks ENER has many good days ahead.
Recently, auction house
had major issues selling a quarter of its paintings, including a well known Van Gogh piece that was suppose to fetch $35 million. Finerman tells viewers that when BID doesn't sell these pieces they own them -- and they now own them at the worst time. She predicts a crack in the art market and BID could get annihilated. Having said that, Finerman doesn't think the luxury trade is over for high-end retailers like
. She explained that Tiffany's sells to a totally different market. Adami comments that this has to give investors pause that the wealth effect didn't take hold at the Sotheby's auction.
has begun with rumored acquirers
Johnson & Johnson
leading the pack. Finerman says these aren't surprising names and she is long BIIB through options. Najarian would like to see more activity in the options on BIIB before he sees it moving higher. Adami would like to see PFE be the buyer to improve their pipeline. He advocates owning PFE here.
Pops & Drops
traded up 2% after posting a 6.9% increase in October same-store sales. Finerman likes MCD and
traded up 4% and hit an all-time high after raising its 2008 forecast. Najarian believes this is only a pop.
popped 9% and
jumped 8% after Deutsche Bank raised price targets for both Russian mobile phone operators. Seymour remarks that these guys are not only growing in Eastern Europe, but even Asia.
Procter & Gamble
traded up 2% as investors looked for safety in a weak tape. Najarian agrees with the market. PG is a great place to put your money if you're looking for a little less stress.
traded up 14% after posting a quarterly loss, but topping Wall Street profit projections. Adami comments that KG is a valuation play and he thinks it's still a buy.
exploded up 140% after the home furnisher agreed to go private for $267 million. However, Finerman reminds viewers that even with the pop, RSTO is still down on the year.
fell 6% as the China trade continues to unwind. The China trade is broken right now according to Seymour and PTR is over for the time being.
fell 8% as the Nasdaq took it on the chin Thursday. Adami would buy it right here for a trade.
Viewers send in their own questions to be answered.
Mary from Connecticut writes, "Since there seem to be so many defaults and foreclosures in the housing sector, will this translate into people defaulting on their credit card payments? And will this hurt
? Adami explains that MA doesn't take credit risk it just process transactions. He mentioned that Deutsche Bank recently put a $250 price target on MA and he likes the stock long-term.
Mary from Nebraska asks, "Why does
keep missing the rising solar tide?" Najarian tells Mary that she is right and AMAT needs to get into the solar sector.
Jackie from New York inquires, "Karen, I know that you are value-oriented with regard to equities, so here is my question.
Ambac Financial Group
has lost about 70% of its value. Is this justified or is this a buying opportunity? If I look back in one or two years, might I see this stock double? Finerman says she doesn't understand Ambac's capital structure and she just can't be comfortable with the name.
Coast to Coast
Peter Vig, managing director of hedge fund Round Rock Capital, joined the "Fast Money" crew from bar in Texas to discuss his oil stock plays. Vig likes deep water drillers like
Diamond Offshore Drilling
because of strong backlogs and reasonable multiples.
After two difficult days in the market, the crew tries to give investors some recommendations.
- Seymour is positive about Alcoa (AA) - Get Report.
- However, Adami thinks the market will continue to decline and he would play it with Short Dow30 Proshares (DOG) - Get Report.
- Finerman recommends Watts Water Technologies (WTS) - Get Report.
- Najarian favors Boston Scientific BSX for the options activity he noticed in the device maker on Thursday.
- Vig likes EOG Resources (EOG) - Get Report and Continental Resources (CLR) - Get Report for plays on oil and natural gas.
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