NEW YORK (TheStreet) -- Stocks were volatile on Thursday, with the S&P 500 and Nasdaq falling 0.8% and 1.6%, respectively.
It was an interesting session, as much-loved sectors like media stocks and health care moved lower, while hated sectors like energy moved higher, Tim Seymour, managing partner of Triogem Asset Management, pointed out on CNBC's "Fast Money" TV show.
Seymour argued that commodities are at or near a bottom, but investors should avoid emerging markets at current levels. And although single-stock volatility - such as in Apple (AAPL) - Get Report and Disney (DIS) - Get Report - has been incredibly high, the volatility index is still low, so investors should buy protection while they can, he said.
The iShares Russell 2000 ETF (IWM) - Get Report closed below the 200-day moving average for the first time this year, added Steve Grasso, director of institutional sales at Stuart Frankel. It's not good for small caps stocks to be breaking the uptrend, especially with so much volatility in the U.S. dollar, bond yields and commodities. Investors are probably best off waiting "for the smoke to clear," he said.
For a long time, the volatility in those other assets hasn't been found in U.S. stocks, according to Brian Kelly, founder of Brian Kelly Capital. But that appears to be changing. He wants to see Friday's non-farm payrolls report before making any major decisions.
Rather than being so cautious, investors should stay the course, argued Rich Ross, managing director at Evercore ISI. Over the past six weeks, stocks have endured a lot of bad news, yet have refused to move significantly lower. The S&P should find support at its 200-day moving average and eventually retest the highs near 2,135.
Ross expects the market to climb to the range of 2,180 to 2,200 before the end of the year, although he acknowledged that August is likely to be volatile.
Given the fact that crude oil moved lower on Thursday, it's quite notable that energy stocks rallied, said Karen Finerman, president of Metropolitan Capital Advisors. Investors seem to be rotating into beaten-down sectors and out of the winners, highlighted by the 4.3% drop in the iShares Biotech ETF (IBB) - Get Report.
The IBB ETF is up 27% on the year, Grasso pointed out, which is still a great return. It will probably be one of the last sectors in the market to "crack" if the selling pressure picks up, as investors still crave the group's growth.
There's still a lot of funding for biotech, both private and public. Until that ends, "biotech is alive and well," Seymour added. However, if the S&P 500 declines significantly, the biotech sector won't be immune.
The conversation turned to solar, as shares of SunEdison (SUNE) slid 25% on Thursday after reporting a disappointing earnings result. The stock is now down 41% on the year and almost 50% from its highs.
Ben Kallo, an analyst at R.W. Baird, downgraded the company to neutral near its highs, but still has a $35 price target on the stock. There was nothing on the conference call that made it appear like the company has a liquidity problem, Kallo explained. It just seems like investors don't understand the company's capital structure.
While the selloff seems like overkill, Kallo doesn't recommend buying at current levels, as more downside could be looming.
Finerman is long SunEdison and said she bought more of the stock on Thursday's selloff. Perhaps a big hedge fund exited its position, but it doesn't help soften the blow, she added.
Kelly agreed that a few funds likely exited the stock, but said the situation isn't necessarily bad if the only problem is that investors don't understand the structure. He's a buyer of Trina Solar (TSL) and the Guggenheim Solar ETF (TAN) - Get Report.
For their final trades, Grasso is buying Southern Company (SO) - Get Report and Seymour is a buyer of AT&T(T) - Get Report. Finerman said to buy call spreads in Michael Kors (KORS) and Kelly is buying the Market Vectors Gold Miners ETF (GDX) - Get Report in the event that the U.S. dollar drops following Friday's labor report.
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This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.