NEW YORK (
) -- The markets plunged Thursday on deepening concerns about the global economy.
Dow Jones Industrial Average
sank 391.01, or 3.51%, to 10,733.83. The
dropped 37.20, or 3.19%, to 1129.56. The
fell 82.52, or 3.25%, to 2455.67.
Tim Seymour said on
's "Fast Money" TV show that the market selloff was fueled by the rising dollar and
comments on a global slowdown. He said the market is in a "dangerous technical place."
Guy Adami said he saw the selloff coming with the decline in the Asian markets and transport stocks. He say the market "seems to want to find a bottom."
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 on TV
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Pete Najarian noted unsually heavy put activity in the
iShares MSCI Emerging Markets Index ETF
Mike Khouw said it didn't make any sense to step into the market with the VIX spiking as high as it did today.
Still, Doug Kass, a RealMoney Silver contributor at
, had an optimistic view of the markets and economy. He said the lows are in the for the S&P. He also said all the economic reports point to non-recessionary conditions in the U.S. And he said U.S. stocks, relative to investment grade and high debt yield instruments, are very undervalued.
Jon Najarian agreed with the economic assessment, noting that
had pointed out that orders were up.
Shifting to the shakeup at
's senior stocks commentator Herb Greenberg, who was listening in on the company conference call, said that executive chairman Ray Lane said former
said the company needed to improve on its ability to execute. He said Meg Whitman was selected as CEO because she had worked for a company that bought a lot of technology.
Adami said Lane's comments sounded similar to those when Leo Apotheker was hired. Seymour said Whitman was another "revolving door," and an executive with little history outside the consumer space.
Finerman wondered whether the selection process was clearly thought out. She said the entire board is up for reelection, providing an opportunity for an activist to step to reshape the board.
Melissa Lee, the host of the show, shifted the discussion to
, which has been in freefall, down 21% in the past week and 50% for the year. Adami said the recent decline might be due to the succession talk to chairman John Mack who is stepping down and reports he heard of the investment bank's exposure to the European debt crisis.
But Seymour downplayed the reports, saying there hasn't been any credible news on Morgan Stanley. Pete Najarian pointed out that
chart had fallen apart.
Can banks do well under the Fed's "Operation Twist?" Chris Mutascio, managing director for Stifel Nicolaus, believes they can. He said they can use the opportunity to shed their balance sheets of low-yield earnings assets. He said the banks would take a hit to their EPS from the move but they would be shedding lowe ROE businesses for higher ROE businesses and redeploying their capital in a more sensible fashion into areas such as dividends and buybacks.
Lee brought in Anthony Scaramucci, of Skybridge Capital, to discuss what hedge fund are doing to limit losses. He said hedge funds are in a better position than they were in 2008, with much lower risk exposure and staying less levered. He also said long and short managers have been in defensive positions since August.
He said his firm thinks there is a 75% chance of a recession by the first quarter of 2012 that will reduce equity prices by 15% to 20%. He said there's not much that can be done to stave that off.
He said hedge funds are putting their money to work in this environment by getting in on the distressed and event-driven equity side and in credit sensitive mortgage-backed securities. He acknowledged there will be redemptions but had a positive outlook for the industry for the long term.
In the volatility playbook, Jon Najarian said that VIX exploded to 43.60 today before pulling back to 41, where he thinks it will hold.
Shifting to the currency trade, Andy Bush, of BMO Capital Markets, commented on the steep erosion in the Brazilian Real, which has lost 25% of its value since the start of the August. He said the softening global economy is impacting risk-on currencies like the Aussie dollar and Canadian dollar.
In the final moves, Seymour said he would be nimbling in currencies and stocks in the emerging markets. Adami liked
. Karen favored
for the possibility of an event-driven move like a breakup. Pete Najarian liked
Written by David Tong in San Francisco.
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