'Fast Money Recap': A Dark Phase - TheStreet

'Fast Money Recap': A Dark Phase

The trading panel feared the market had entered a new and dark phase this year.
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NEW YORK (

TheStreet

) -- The markets kicked off a new month with continued worries about

BP

's

(BP) - Get Report

problems and its impact on the energy sector.

The

Dow Jones Industrial Average

fell 112.61, or 1.11%, to 10,024.02, and the

S&P 500

dropped 18.70, or 1.72%, to 1,070.71. The

Nasdaq

sank 34.71, or 1.54%, to 2,222.33.

Joe Terranova said on

CNBC

's "Fast Money" TV show that the S&P fell in large part to the dramatic selling in energy names. He said it's particularly troublesome because no one knows where the bottom is in the energy space.

For a breakout of some stocks from a recent "Fast Money" TV show,check out Dan Fitzpatrick's "3 Stocks I Saw on TV."

3 Stocks I Saw onTV

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Tim Seymour agreed, saying the S&P looks as if it is heading to 1,044. He said the index looks like it wants to go lower given the troubling global economy.

Anthony Scaramucci said today's close was "sloppy" and that he was very worried about poor near-term technicals, fundamentals that don't look right and the huge overhang from BP's growing problems.

Melissa Lee, the moderator of the show, said investors are also worried about the uncertainty arising from massive government intervention in the energy sector by way of increased regulation and moratoriums.

Terranova said the market in June is different from any other month this year and warrants being defensive. Now it's all about owning

IBM

(IBM) - Get Report

,

Kraft

(KFT)

or

Wal-Mart

(WMT) - Get Report

, he said.

Brian Kelly held out hope for a chance of a rally in June if the S&P can stay above 1,050.

Lee said BP has taken a brutal beating, with 30% of its market cap erased by the disaster in the Gulf Coast. Gary Kaminsky said mutual fund managers will be net sellers of the stock the rest of the month and warned against buying the stock for its dividend.

Matt Simons, chairman emeritus of Simmons & Co. International, said the senior management of BP have done a poor job and should be "asked to let go." He said the military might follow what the Soviets did in the 1970s to stop a blowout when they used small nuclear bombs.

Scaramucci criticized the move, saying it would kill tourism and set back the economy.

Lee shifted to another factor that cast a cloud on the markets: a PMI report from China showing weaker-than-expected factory production. Seymour downplayed the report, citing evidence of export demand in the numbers. And Steve Liesman, a CNBC reporter, said China was taking prudent steps to prevent its economy from overheating.

Terranova and other panelists noted the terrible shape of European banks. Terranova said the European banks are still far behind what the U.S. banks have done in getting capital assistance and removing the threat of nationalization.

Kaminsky said attention should focus on the short-term markets and the portfolio managers who run the money market funds. Seymour said the other scary factor in the equation is the consumer in Europe, where a report today indicated unemployment has skied to 10.1 percent, the highest level since 1998.

Lee brought in Jim Goldman, a

CNBC

technology reporter, to talk about Steve Jobs appearance at the "All Things Digital" conference in San Francisco.

Goldman said Jobs will undoubtedly be asked by reporters about the company's frothy stock valuation, the likelihood of increased federal scrutiny and the case of the missing iPhone. He said Apple has done exceedingly well with the iPad, having sold 2 million in two months.

Finerman said she has been in the long in the stock for sometime, while Scaramucci warned of the headwinds companies historically have faced when they reach a market cap of $250 billion.

In the call for the day, Niamh Alexander, a KBW analyst, backed up her outperform call on

Nasdaq OMX Group

I:IXIC

, saying it was based on bump it wasa getting from the volatility in the market, valuation and seven times next year's free cash flow earnings.

Lee brought in Eileen Naughton, director of media sales and operations in North and Latin America, to talk about a recent company report that noted that $1 worth of advertising spend created $8 in profits for companies. Naughton said the report conservatively estimated the use of ad search had created $54 billion in economic value for the region.

In the final trades, Seymour said to sell

Rio Tinto

(RTP)

. Scaramucci said to pick up some

Hewlett-Packard

(HPQ) - Get Report

. Finerman said she liked

Philip Morris International

(PM) - Get Report

. Terranova said he liked

Best Buy

(BBY) - Get Report

.

-- Written by David Tong in San Francisco

To watch replays of Cramer's video segments, visit the Mad Money page onCNBC

.

"Check out

"'Fast Money'Portfolios of the Week" on Stockpickr every Thursday.

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