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Stocks Snap Winning Streak

Wednesday, 26 Mar 2008 | 6:40 PM ET

STOCKS SNAP 3-DAY WINNING STREAK

The headline: Weak Economic Reports, More Writedown Worries Knock Stocks.

The Dow fell Wednesday as investors were pelted with reports that triggered concerns about the economy, explains Dylan Ratigan. The decline was led by financial issues. An analyst at Oppenheimer cut her first-quarter earnings estimate on U.S. banks by an average 84 percent. And, citing mortgage and other write-downs, she cut fiscal 2008 earnings views by 30 percent.

Investors also sold off consumer stocks after the Commerce Department reported that February new-home sales fell to the lowest level in 13 years and that orders for durable goods dropped unexpectedly last month.

I didn’t think Wednesday’s pull back was a big deal, says Karen Finerman. It wasn’t terribly dramatic. In fact, I expected it.

I agree, says Tim Seymour.

I see it differently, counters Pete Najarian. I think there are major problems in the financials.

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AFTER HOURS ACTION: ORACLE

The headline: Oracle New Software Sales At Low End Of Estimates

Oracle Corp reported a higher quarterly profit on Wednesday, but its 16 percent rise in new software sales was at the low end of expectations, explains Dylan Ratigan, and shares fell 8.3 percent.

I’m not worried about these numbers, says Pete Najarian. I like this company and I think by tomorrow the stock will be back; well into the $20’s.

I’m expecting surprises on the upside, adds Tim Seymour.

Read More

> Oracle Earnings Rise But Software Sales Disappoint


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GASOLINE PRICES HIT RECORD

The headline: Crude Oil, Gasoline Surge After Report Shows Fuel Supplies Fell More Than Expected.

Gasoline futures climbed 2% to $2.74 a gallon in New York after news that inventories fell by 3.3 million barrels as U.S. refiners slowed production to their lowest levels since Oct. 2005, when several refineries were knocked offline by hurricanes, explains Dylan Ratigan.

I like the refiners as well as the off-shore drillers says Tim Seymour. Look at Transocean , Halliburton (HAL) and Schlumberger (SLB).

Or BJ Services (BJS), adds Karen Finerman.

Look at nat gas, exclaims Pete Najarian, companies such as United States Natural Gas (UNG) and Apache (APA).

> Read More

Find out how Carter Worth recommends trading it in “Charting Oil”
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CITIGROUP SLAMMED

The headline: Oppenheimer's Whitney Expects Citigroup To Post Loss Of $0.15 Per Share In 2008.

Bank stocks tumbled across the board when a prominent analyst lowered her first-quarter profit forecasts for Citigroupand other banks including Bank of America Corp (BAC), JPMorgan (JPM) and Wachovia Corp (WB), explains Dylan Ratigan. Oppenheimer & Co analyst Meredith Whitney said bank profits would not start growing any time soon because of fallout from what she called the worst credit cycle in generations.

Meredith Whitney has been right, says Pete Najarian. If she doesn’t like the money-centers then I don’t either.

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PROTESTORS AT BEAR STEARNS

The headline: The Neighborhood Assistance Corporation of America Stages Protest

About 60 protesters opposed to the Federal Reserve's help in bailing out Bear Stearns entered the lobby of the investment bank's Manhattan headquarters Wednesday, demanding assistance for struggling homeowners, explains Dylan Ratigan.

Demonstrators organized by the Neighborhood Assistance Corporation of America chanted "Help Main Street, not Wall Street" and entered the lobby without an invitation for about half an hour before being escorted out by police.

I expect a lot of investigation into the JPM Morgan (JPM) takeover of Bear, says Tim Seymour.

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MOTORIN'..WHAT'S YOUR PRICE FOR DEVICE?

The headline: Motorola To Split Into 2 Public Companies Under Pressure From Carl Icahn.

Motorola said it would split into two publicly traded entities to separate its loss-making handset division from its other businesses, sending its shares up about 5 percent, explains Dylan Ratigan.

The move, which comes amid an intensifying proxy battle against activist investor Carl Icahn ahead of a May 5 annual meeting, could be a prelude for a joint venture for the cell phone business, analysts said.

I don’t know that this break-up does anything to help the underlying values, says Karen Finerman.

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MENU OPTIONS

The headline: Pete Seeing Unusual Options Activity In Food Giant ConAgra.

ConAgra reports earnings Thursday before the bell, explains Pete Najarian. The put buying suggests to me there could be negative news coming.

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TAKE THAT, ELECTRONIC ARTS

The headline: Take-Two Rejects Electronic Arts' $2B Takeover Offer For The 2nd Time.

Take-Two Interactive Software Inc told shareholders to reject a $2 billion hostile bid from rival video game publisher Electronic Arts Inc as too low, but said it had begun efforts to explore a sale or other options.

It all comes down to Take Two’s Grand Theft Auto 4, says Jeff Macke, which is getting great reviews ahead of its release. However, if you’re looking for a video game trade get long Activision (ATVI), he counsels.

Word on the Street
The Fast Money traders take a look at today's top business stories.

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Trader disclosure: On Mar.26, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (YHOO), (INTC), (EMC), (ATVI), (DIS); Najarian Owns (AAPL), (CSCO), (EMC), (MS), (MSFT), (NOK), (ORCL), (TSO), (XLF), (YHOO); Najarian Is Short (CAG); Najarian Owns (COP) Calls, (RMBS) Calls; Najarian Owns (MER) Puts; Najarian Owns (BSC) Calls; (CHK) Calls; Najarian Owned (RMBS) Calls On 1/30/08; Finerman Owns (GS); Finerman's Firm And Finerman Own (HD); Finerman's Firm Owns (CLWR), (MO), (MSFT), (SUN), (VLO), (WMT), (YHOO), (TSO), (BCE), (BJS); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (COF), (GLD); Finerman's Firm And Finerman Own (KALU); Seymour Owns (AAPL), (CSCO), (INTC), (MER), (MSFT), (S), (TSO), (F), (HAL); Seygem Asset Management Owns Severstal, (TTM)

  Price   Change %Change
DJIA
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CAG
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ORCL
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RIG
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TTWO
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JPM MLP ETN
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C
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APA
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SLB
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HAL
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