'Fast Money' Recap: Tech Breaking Down?

NEW YORK ( TheStreet) -- The markets fell back Wednesday on weakness in the financial and tech stocks.

The Dow Jones Industrial Average dropped 12.64, or 0.11%, to 11,825.29. The S&P 500 lost 13.10, or 1.01%, to 1,281.92. The Nasdaq fell 40.49, or 1.46%, to 2,725.36.

Guy Adami said on CNBC's "Fast Money" TV show that eBay's ( EBAY) results were fine but he was "scared" of the stock's chart. "The stock needs to break above its 52-week highs in November."

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

Brian Kelly said the most impressive part of eBay's earnings was Paypal, whose volume has jumped 500% since 2009 as it is adding 1 million accounts a month. He said American Express ( AXP) brought home that point when it said it was losing share to mobile electronic services.

Tim Seymour, though, argued that Kelly's point about Paypal is well known. "There's no mystery here," he said, adding there's no reason to jump into the stock.

Melissa Lee, the moderator of the show, turned her attention to the huge selloff in F5 Networks ( FFIV), off 33.42, or 23.57%, on a troubling guidance.

Joe Terranova said the selloff could lead to a further downside in the cloud trade Thursday. Adami wondered how the selloff would affect Cisco ( CISCO), which has been a non-performer.

Seymour said the 1% drop in the S&P has turned the market into one for traders. Terranova said he would be leery of jumping into tech stocks until he sees some price stabilization.

Adami said even a stock like Apple ( AAPL) could be due for a reversal, perhaps to $310. Finerman said it was difficult to get a reading on Apple because of Steve Jobs' medical situation and determining what might be the next catalyst for the company.

Seymour said IBM ( IBM) performed well today because because it is a diversified story in tech.

Terranova wondered whether the tech space is breaking down. He said it may depend on Google's ( GOOG) earnings Thursday. Kelly said the price action in tech looked more like a "hiccup" and that he would be buying Qualcomm ( QCOM) on weakness.

The revenue miss by Goldman Sachs ( GS) contributed to the slide in the financials, prompting Adami to wonder whether the stock was due for a pullback.

Steve Cortes was more optimistic. He said Goldman is still a premier name that has three things going for it: the recovery of the bond market, the trading of the stock at close to book value and the flow of deals.

Seymour said Goldman's problems has more to due with the hit it has taken from regulatory fines. Terranova noted the stock fell below its 50-day moving average and needs to get above $172.

The fall in global commodity stocks today prompted Dennis Gartman to say it was one of the worst days he's seen in quite a while. He said the news about Mosaic ( MOS) and Cardill set off a bad day for ag commodities. He said a correction was due in that space after quite a run.

Vincent Andrews, Morgan Stanley analyst, said the underlying driver of the Mosaic transaction was a desire to do Cardill's divestiture of Mosaic stock in a tax-free way.

Finerman said there was too much overhang in Mosaic to get into it. She personally doesn't think it's for sale. What did intrigue her was the announced merger of Lundin Mining ( LUN) and Inmet Mining ( IMN), in which she is long on both stocks in what she called a "Texas hedge." She saw the deal as a merger of equals.

Should Goldman be split into three parts? Jesse Eisinger, a reporter for ProPublica, admitted it sounded farfetched. But he said the break-up of Goldman into investment banking, trading and management makes sense because they are trading a big discount at a time when players like Lazard ( LAZ), Jefferies ( JEF) and Blackrock ( BLK) are trading at a premium.

He told Finerman there may be signs of activist pressure if Goldman slips to 1.125 book value and stays there for some time.

Is the muni crisis overblown? Daniel Clifton, head of policy research for Strategas Research Partners, thinks so. He said the state fiscal outlook is looking better as state governments cut spending and see revenue grow as a result of a cylical turn in the economy. He also said local government, with their improving balance sheets, are doing much better than expected.

Instead of trading munis, he said he would go with a stock like Assured Guaranty ( AGO), which insures municipal bonds and which has priced in a default scenario.

Lee brought in Imax ( IMAX) CEO Richard Gelfond to comment on takeover rumors. He declined comment on the rumors. Instead he said the company would like to remain independent and focused on the company's growth, noting it has signed 200 theaters and is looking for a 20% growth in the network in 2011.

He's also mentioned some of the big movies his company is working on this year, including a sequel to Pirates of the Caribbean, Mission Impossible 4, and the final chapter of the Harry Potter series.

Chartist Carter Worth discussed the importance of the S&P breaking through the 1,220 level as a sign that it may be heading toward 1,400.

In the final trades, Seymour said he is shorting BHP Billiton ( BHP). Adami liked McDonald's ( MCD). Finerman said she was keeping her market puts for one more day. Terranova said he bought some shares of ProShares UltraShort 20+ Year Treasury ETF ( TBT), adding he may need them Thursday.

--Written by David Tong in San Francisco.

To contact the writer of this article, click here: David Tong.

To follow the writer on Twitter, go to http://twitter.com/davidtong.

To submit a news tip, send an email to: tips@thestreet.com.

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

Follow TheStreet.com on Twitter and become a fan on Facebook.