NEW YORK (
) -- The markets ended high Monday on
big deal and
plans to repay TARP funds.
Dow Jones Industrial Average
rose 29.55, or 0.28%, to 10,501.05, while the
added 7.07, or 0.70%, to 1,114.11. The
jumped 21.79, or 0.99%, to 2,121.10.
Melissa Lee said on
's "Fast Money" TV show, that Exxon's deal with
( XTO) could unleash a wave of deals. Pete Najarian said an integrated name like
has already been positioning itself into shale products in the past year and a half.
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
varconfig = new Array(); config<BRACKET>"videoId"</BRACKET> = 57026547001;config<BRACKET>"playerTag"</BRACKET> = "TSCM Embedded Video Player";config<BRACKET>"autoStart"</BRACKET> = false;config<BRACKET>"preloadBackColor"</BRACKET> = "#FFFFFF";config<BRACKET>"useOverlayMenu"</BRACKET> = "false";config<BRACKET>"width"</BRACKET> = 265;config<BRACKET>"height"</BRACKET> = 255;config<BRACKET>"playerId"</BRACKET> = 1243645856;createExperience(config, 8);
Tim Seymour said Exxon's deal for XTO means it is not as well positioned abroad for unconventional resources.
Joe Terranova said the bottom for the price of natural gas is in, and he expects it to rally in the long term.
Gary Kaminsky said he expects more big deals to come because that's been the historical pattern in the sector.
Terranova said today's deal is looked at not as a "stock specific event" so much as a "macro-event" and a sign of increased M&A activity in 2010 that will be influenced by domestic energy policy and what the nation will come to rely on for energy sources.
Seymour said only a few companies can pull off the deal that Exxon did today. He said Exxon did it with $31 billion of its stock. "That's the currency of choice for them," he said.
Najarian said the deal reflected the influence of the low price of natural gas and attractiveness of coal as an energy source in the future.
Terranova said Exxon needed to do the deal because it reported a 68% profit decline in the third quarter and its production was only up marginally. Furthermore, he said it had to do the deal within the U.S. because overseas sources like OPEC appear to be unreliable.
Lee noted that
dropped 6% on fears of stock dilution. Seymour was cautious about the financial services company, saying it's still a TARP recipient and will be still under the government's thumb. However, he said the good thing about the deal is that it will improve Citigroup's Tier 1 equity, and "that's exactly what the government wants."
Kaminsky said there's definitely a feeling in the market that the deal may be premature and that Citigroup's situation won't clear up until it delivers favorable earnings next year. Najarian said it will take time to digest the deal, adding there's still not enough clarity on Citibank.
Josh Rosner, managing director of Graham Fisher, said that the banking industry will still be in a lot of trouble after all the TARP funds are repaid. He said the industry needs to recognize more losses. He said there will be more writedowns, a lot of deteriorating commercial and industrial loans, and an aggregate second lien book exposure carried at 95 cents across the industry.
He said the government hasn't clarified the situation because it hasn't provided on what it used to determine when, how, and why these institutions were allowed to repay their TARP funds. "It seems like a hodge podge approach," he said, adding banking stocks are simply "trading stocks."
Oil had another rough day, falling for ninth consecutive session. Terranova attributed it to massive inventories reflected in January contract. Seymour agreed with Terranova that investors should not be shorting oil at this time because the situation could change as early as next week's OPEC meeting if the organization makes a surprising announcement.
Seymour said coal could also be heading higher on the heels of a report that China increased its power consumption by 26% last month.
Terranova said the spot price of oil will be under pressure until Martin Luther King day. He said the drop in oil hasn't affected the integrateds.
Jon Najarian doesn't think there will be another deal this year but that there will be deals next year. He said
would be too costly for any acquirer. He liked smaller names like
Plains Exploration and Production
fell more than 2% after an article in
said the stock price is too rich. Terranova said though the stock has reversed course since hitting its 52-week high, it remains strong fundamentally. He said the future is bright, with ecommerce accounting for only 6% of the developed retail spending globally. The stock, which is up 156% for the year, closed today at $131.38.
On the prop desk, Kaminsky, who correctly predicted a rise in the airline sector a month ago, said the trade is not over. He said price increases are sticking and there hasn't been an irrational amount of new capacity.
Are the health care stocks coming back? Najarian said
saw a lot of activity today. He said these stocks will do well because the final health care reform bill "won't be as hurt" to them.
Terranova added the managed health care space is underowned and to stay with the trade. Seymour, though, said there's still a lot of uncertainty in the space because it's difficult to tell which direction the bill take in its final form.
Moving to the technology sector, Pip Coburn, founder and CEO of Coburn Ventures, wasn't too happy about
announcement today that it was coming out with a new smartphone. He said Google has been vague about quantity and price. He sid Google should just stick to growing its search business. He said if it does that and grow its mobile search business, it could attend an impressive 15% to 20% growth rate.
Lee brought in Dan Binder, an analyst with Jefferies, to talk about
, which reports its earnings Tuesday. He said there's been a material improvement in its business since the back-to-school sales and toward the holiday season.
He said the company has taken advantage of Circuit City's departure and has grown market share. He sees the retail momentum stock heading to $50.
In the final trades, Seymour liked
. Kaminsky liked
. Terranova preferred
. And Najarian liked
Cliffs Natural Resources
-- Written by David Tong in San Francisco
To watch replays of Cramer's video segments, visit the Mad Money page onCNBC
"'Fast Money'Portfolios of the Week" on Stockpickr every Thursday.
Follow TheStreet.com on
and become a fan on