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Next Stop In Credit Crisis?

The Dow surged higher on Thursday on optimism about a possible government resolution to the financial crisis.

But the Fast Money traders might have discovered where the next shoe is about to drop.

If you look at the Dow, it moved 1200 points in total, top to bottom on Thursday, says Pete Najarian. That’s staggering. And we don’t know what’s going to happen. That’s a concern to me. We might not be out of the woods, just yet.

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NEXT FRONT OF CREDIT CRISIS: STATE STREET?

Shares of trust bank and asset manager State Street slumped Thursday on concerns of losses in its investment portfolio.

"There's a concern that State Street's investment portfolio may have greater mark-to-market issues than earlier anticipated," said Gerard Cassidy, analyst at RBC Capital Markets.

This was a $75 stock on Wednesday and then danced to $29 before clawing it’s way back, explains Dylan Ratigan. The chart below shows the stock's move in one day.

Symbol
Price
 
Change
%Change
STT
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It was in a death spiral, but if finally slowed when the market found out the government planned to take broad action, Pete Najarian explains. We'll have to wait and see.

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NOT SO SCARED

The much watched VIX, or Volatility index that Pete Najarian talks about so often retreated on Thursday after hitting it’s highest level in 60 days.

This index averages between 17 and 23, explains Najarian. On Thursday it went to 41. That's a big spike.

However, from this point forward volatility could moderate, "now that the government has taken zero off the table," adds Jeff Macke.


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Symbol
Price
 
Change
%Change
ORCL
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AFTER HOURS ACTION: ORACLE


Oracle reported a profit that rose over last year and topped analysts' expectations by 2 cents a share, as sales of its database and business management software met its own estimates.

This chart is setting up like a classic head and shoulders, says Guy Adami.




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HIGH FINANCE TO CHEESE

A week of pain for AIG took another hard turn on Thursday when it got booted from the Dow Jones industrial average, ending the shortest term any company has spent in the blue-chip index since the Great Depression.

Taking its place come Monday's opening bell is Kraft Foods . Emblematic of the current market turmoil, the maker of such comfort foods as Oreo cookies and Kraft Mac & Cheese was apparently seen as a better fit for the world's most-watched stock index than another risky financial company.





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Trader disclosure: On Sept 18, 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 (SDS), (WMT), (MSFT); Adami Owns (AGU), (BTU), (C), (GS), (MSFT), (NUE); Pete Najarian Owns (AAPL) And (AAPL) Collar; Pete Najarian Owns (ETFC); Pete Najarian Owns (MS) And (MS) Puts; Pete Najarian Owns (NOK) And Is Short (NOK) Calls; Pete Najarian Owns (RIMM) Call Spreads; Pete Najarian Owns (TSO) Call Spread; Pete Najarian Owns (WB) Put Spread; Pete Najarian Owns (WM) And (WM) Puts; Pete Najarian Owns (XLF) And (XLF) Puts; Finerman Owns (GS); Finerman's Firm Owns (MO), (MSFT), (NOK), (SUN), (TSO), (VLO); Finerman's Firm Owns (WFC) Puts; Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (COF)

Symbol
Price
 
Change
%Change
DJIA
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AFF
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MDLZ
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ORCL
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STT
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VIX
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