'Fast Money' Recap: Yahoo! Gets Rattled - TheStreet

After the Microsoft (MSFT) - Get Report-Yahoo! (YHOO) merger appeared to fall apart, U.S. stocks lost their mojo, closing to the downside Monday. The Dow dipped 0.7%, the S&P 500 stumbled 0.5 and the Nasdaq was also down 0.5%.

On

CNBC's

"Fast Money" TV show, Pete Najarian said that copper, gold and steel all came back while financial stocks took it "a bit on the chin." He said that

Bank of America

(BAC) - Get Report

,

Citigroup

(C) - Get Report

and

AIG

(AIG) - Get Report

were the financial stocks to get hit. He said

Google

(GOOG) - Get Report

and other tech stocks were making a comeback.

On the Yahoo!-Microsoft news, Jeff Macke urged viewers to get out of Yahoo!. He said Microsoft is the better stock. He cautioned however that Microsoft will take time to rebuild confidence, because the company shouldn't have gotten involved with Yahoo! in the first place.

Finerman said she sold some Yahoo! stock on its surprising strength today.

Najarian said that the failure of Microsoft shares to spike on the news may indicate that someone thinks the Yahoo! deal may still happen. Guy Adami said the company can rebuild confidence by announcing a stock buyback.

3 Stocks I Saw on TV

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More Deal Rumblings

Finerman noted skepticism on the Street about Bank of America's offer to buy

Countrywide Financial

( CFC). She said Countrywide may be different when it's presented to BofA for acquisition. Adami said he believes there's downside in Countrywide shares.

On news that

Sprint

(S) - Get Report

may spin off a segment of its company, Macke instructed viewers to walk away. He said that, like a

Motorola

( MOT) breakup, the idea will accomplish very little. He recommended buying

AT&T

(T) - Get Report

and

Verizon

(VZ) - Get Report

instead. Najarian pointed out that

Deutsche Telekom

( DT) would be the No. 1 telecom if it bought Sprint or Sprint Nextel.

In the airlines, Najarian noted that the railroads, which are currently performing very well, didn't achieve that success overnight. He said the airlines will take time to begin working. He said the sector has an opportunity to perform better if competition eases. He said he's not going near the airlines yet.

Oilfield Plays

Oil reached $119.97 a barrel today on news of militant activity in Nigeria. The traders talked to

CNBC

contributor Addison Armstrong about commodities. He said the rise of oil looks strong, but he urged viewers to be cautious. He said that today's rally wasn't very convincing because volume was low. Najarian said that investors who believe in oil's continued rise can short the airlines. Macke recommended buying the

U.S. Oil Fund

(USO) - Get Report

. Armstrong recommended shorting the oil refiners, because higher input costs will cut into margins.

Najarian noted that

Alpha Natural Resources

(ANR)

has tripled profits. He also said

Walter Industries

(WLT)

has had a good run in the metallurgic coal business. He said he took all his positions off because it's smart to take profits after a good run. Wait for pullbacks, he urged viewers.

Adami pointed to

Joy Global

( JOYG) and

Bucyrus

( BUCY). These stocks will continue to go higher, he said.

Najarian said to keep an eye on

Cleveland-Cliffs

(CLF) - Get Report

on pullbacks.

On an upcoming earnings report from

Cisco

(CSCO) - Get Report

, Najarian said he doesn't know how the company can fail to produce good news. He said that good news in the wireless world puts Cisco in the sweet spot.

Macke recommended selling the stock, pointing out that it has risen 8% in the last month. He recommended buying on a dip. Adami said he believes the quarter will be fine, but anything pessimistic will spur a selloff.

Hot Tickets

Iron Man

brought in $100 million a the box office this past weekend. Shares of

Marvel Entertainment

( MVL) were up 9%.

Macke said that toy stores appear to be out of

Hasbro

(HAS) - Get Report

Iron Man toys. He said Hasbro is the winner on this news, and shares haven't responded.

The traders contemplated the fate of Yahoo! now that Microsoft has withdrawn its bid for the company. Finerman predicted that shareholders would go hostile. She pointed to a part of Microsoft CEO Steve Ballmer's letter to shareholders that said Yahoo! doesn't care about its investors. She said Yahoo! shareholders can nominate a new board to try to agitate for change. Macke said the Yahoo! board is in trouble. Najarian said that Microsoft may come back into the picture later on.

Media Ratings

Disney

(DIS) - Get Report

and

News Corp.

(NWS) - Get Report

report earnings this week.

Macke said he's long Disney and likes the company's diversified revenue streams. He said the stock is more of a long-term investment. Najarian said he doesn't like News Corp., but he likes Disney because of ESPN and this summer's movie lineup. He said Disney's price-to-earnings ratio of 16 is good. Adami said Disney's valuation is compelling and its operating revenue is fantastic.

The traders then welcomed Steven Cortes, head of Veracruz Research, to talk about the idea of buying stocks that benefit from a resurgence in the American market. Cortes said that after underperforming for five years, the U.S. market has become a value asset. He said that now that war spending is plateauing and the Fed is nearly done cutting interest rates, the dollar is trading very well. He said he'd deploy this trade by going with companies with a lot of domestic exposure, such as

Wal-Mart

(WMT) - Get Report

and

UPS

(UPS) - Get Report

.

Adami said he believes the dollar should do well in the second half of the year. Najarian said that it's too early for him to get interested in this trade. Macke said that if Cortes' thesis is right, it could spell pain for

Hewlett-Packard

(HPQ) - Get Report

and

McDonald's

(MCD) - Get Report

.

Trader Radar

Pfizer

(PFE) - Get Report

traded on unusual volume today.

Adami looked at

Church & Dwight

(CHD) - Get Report

, a consumer products colossus that makes such "gross out" goods as Trojan condoms. He said the stock has caught up to

Procter & Gamble

(PG) - Get Report

in terms of valuation but the company does everything right when it reports earnings. Najarian said he likes

Johnson & Johnson

(JNJ) - Get Report

as another play in the space.

Cinco de Mayo

Tim Seymour joined the show to talk about some potential Mexico stocks. He said that a housing buildout and energy reform could be changing the Mexico market. He said that

Cemex

(CX) - Get Report

, a cement company, is a buy. He said he believes the infrastructure play in Mexico is more interesting than textiles or consumer stories. He said he also likes

America Movil

(AMX) - Get Report

because it is a bellwether of the emerging-market cellular plays. Najarian, Adami and Finerman agreed on Cemex. Macke said he prefers Wal-Mart.

Final Trade

Macke selected Hasbro. Adami picked

Anheuser-Busch

(BUD) - Get Report

. Finerman chose

ValueClick

(VCLK)

. Najarian went with AT&T.