Pat Fitzgibbons Chats on Yahoo!, Jan. 4

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Below is the transcript of Pat Fitzgibbons' Jan. 4 chat on Yahoo!. As with all chats, this transcript is unedited.

TSCEllen:

Welcome to today's chat with TheStreet.com's Markets Editor Pat Fitzgibbons.

pat_tsc:

Hi everyone and welcome to this chat! It's been a wild day here, but we'll see if we can't make a little sense of it.

pat_tsc:

I'm Pat Fitzgibbons and I'm the senior markets editor for TheStreet.com. While I can't make recommendations about individual stocks, we can talk a bit about what was happening today.

prancingpony_2000 asks:

How far will this correction go?

pat_tsc:

It's a little hard to tell right now. The market experienced some pretty broad selling today.

pat_tsc:

But, there's some pretty broad concerns about future interest-rate hikes.

Pirategrrrrl asks:

I really haven't seen a proportional hit in the 'net techs as I have in the financials and banking sectors. Do you see this as a bottom in the banking /financial sector, and do you think that some of the tech money will move in the direction of financials and banks?

pat_tsc:

A good question. The techs got battered around pretty good today, but still not to the extent that the financial sector has been hammered.

pat_tsc:

If there are prolonged concerns about interest rates and how much the Fed will raise rates, then financials could suffer more.

pat_tsc:

Hard to say what the bottom actually is on a day like today!

CABob39 asks:

So are we just returning Christmas presents, or is something significant happening in the market?

pat_tsc:

Well, I know I have a sweater that has to get back...but when you have a day like today, it's pretty significant.

pat_tsc:

Things moved broadly lower, but trading was pretty orderly and there wasn't the sense that there was any real panic.

prancingpony_2000 asks:

Question: Is this just technical correction and if so, how far down?

pat_tsc:

Can't really say how far down, in this market. There will be lots of things to look for tomorrow and through the rest of this week -- economic numbers and the like -- that will give us a better sense about how low it can go.

Pirategrrrrl asks:

Some of the banks (like ONE) and insurance companies (like ALL) have some management problems, and are very cheap. Do you think that this is a good environment for buyouts of these companies? There have been rumors of Citigroup buying out ONE, and Warren Buffet being interested in ALL during the past couple of weeks.

pat_tsc:

Management problems are always something to look at in evaluating stocks and weighing risk. However, ONE has been in the news a lot lately and Warren Buffett's interest in insurance companies is not really mind-blowing news....

ppartydogg asks:

THIS SOUNDS PARANOID BUT.......SOUNDS LIKE THE STOCKS TOOK A BEATING TODAY TO GET THE BONDS BACK UP, JUST HOW EVERYONE WANTED..........IS IT POSSIBLE THAT THE BOND RATES HAVE SOMETHING TO DO WITH TODAYS LOSSES?

pat_tsc:

Partydogg, not sure if that's paranoid or not, but stocks' fall can be traced, at least partially to the generally lousy bond market for the last year or so.

Pirategrrrrl asks:

Some of the biotechs took the heaviest hit as a group today, do you see this as a buying opportunity, and would you be a buyer of HGSI at these levels?

pat_tsc:

Hard to see a buying opportunity in the bio-techs. While I can't make a recommendation on a particular stock, it's essential in this sector to see what products the company has in its pipeline and how it's doing about gaining approvals from the FDA.

jweisgal asks:

So whats the reason for the drop?

pat_tsc:

There's plenty! The bond market, concerns that the Fed will go on an interest-rate-raising spree, and possibly even a large seller that caught the selling bug early today and kept it up all day.

alaskan_assassin2 asks:

Do you have an internet site that helps people that is starting out?

pat_tsc:

Sure, actually I work for one! At TheStreet.com we have a whole load of reporters and columnists that write everyday to keep you up-to-date about the market, its trends and what to look for in the future.

pat_tsc:

Now, if that's not a plug, I don't know what is!!

TSCEllen:

Pat, do you think the dive has anything to do with the Nasdaq's new gaudy marketsite in Times Square?

pat_tsc:

Hmmm, not too sure about that. I will agree that it IS gaudy, but in Times Square everything is relative.

yb_2100 asks:

I want to invest in Cisco and Oracle but have been told to wait for a "correction". What do some of you more experienced traders think of this?

pat_tsc:

Again, I can't really recommend individual stocks but in this market, moving higher almost every day, it's pretty hard to look at what happened today as anything but a great chance to hop in.

ACE_869 asks:

Why do we use "correction"? What are we correcting?

pat_tsc:

Well Ace, I guess we're using correction because we don't have a better word...If anything maybe we're correcting the assumption that this market -- and indeed investing in stocks -- never has a down day.

alovingwife asks:

What is your opinion of microcap funds?

pat_tsc:

Without naming names, the smaller the company, the more you need to be wary of quick and violent fluctuations. I guess they're as safe/dangerous as anything else, but not for the rent money!!

Pirategrrrrl asks:

I've been purchasing some puts on the QQQ the last couple of days, and have closed out some of that position today. I'm thinking of buying calls on the bank index tomorrow, do you think my timing is reasonable?

pat_tsc:

Again, in this market I think it's very risky to try and be a market-timer.

pat_tsc:

If you are comfortable making a play, make it, if you feel it's risky, especially in this market, well, then you might better hold off.

BigDuke6_Nbr1 asks:

TSC, why is there such a knee jerk reaction to news like today?

pat_tsc:

I'm not sure it is knee-jerk. When the market performs as it has for the last few weeks, a down day (and especially one where the Nasdaq loses more than it ever has in one day) is, in and of itself, news.

pat_tsc:

Also, the things that hit stocks today are critical to this market and to the overall economy -- rates and the Fed and the bond market.

brtt_56 asks:

Who are your idols?

pat_tsc:

Let's see...aside from my folks,

Jackie Robinson

and

Branch Rickey

. They took a huge risk, didn't back down from horrendous adversity and, in the end, both did the right thing.

laura_the_street:

That's all we have time for today. Thanks for joining Pat Fitzgibbons, Senior Markets Editor at TheStreet.com.

pat_tsc:

Thanks for the great questions and we'll see you all soon at TheStreet.com!

laura_the_street:

Thanks again for joining us.