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Fast Money HomeFast Money Rapid RecapAbout Fast MoneyFast Money BiosFast Money Web ExtraFast Money Disclaimer
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Oct.03
6:29 PM ET
Friday, 3 Oct 2008
Bailout Bust: Stocks Drop
Posted By:Lee Brodie

BAILOUT BUST: STOCKS DROP

Wall Street ended its worst week in seven years with another tumble on Friday on fears a $700 billion financial sector rescue plan won't unlock credit markets or stave off a U.S. recession.

Financial stocks [XLF  Loading...      ()   ], which had traded sharply higher on the promise the bill would be passed, fell after the House vote on profit-taking and as the market focused on the tough road that still lies ahead for the U.S. economy.

I don’t think the credit markets can turn on a dime, says Guy Adami. I think you’ve got to let it sort itself out now for about 2 or even 3 weeks. Then it should get better.

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DIAMONDS ON THE MUCK

Despite all the market mayhem some stocks still look attractive to the traders. Specifically, they like Freeport-McMoRan [FCX  Loading...      ()   ], Petrobras [PBR  Loading...      ()   ] and Apple [AAPL  Loading...      ()   ]. Here’s why.

Keep an eye on FCX, says Guy Adami. I think the stock is setting up for capitulation.

I’d keep an eye on Celgene [CELG  Loading...      ()   ] and CME [CME  Loading...      ()   ], adds Joe Terranova. They look like they’re oversold to me.

There’s a real world economy out there, says Zach Karabell. But it’s being priced as the mother of all depressions. It’s not. There are currently values out there that you won’t find again for many year.

I’d buy Petrobras [PBR  Loading...      ()   ], right here and right now, says Tim Seymour. Considering the strength of this company, Petrobras is an innocent victim.

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BREAKING NEWS: BARCLAYS AND STATE STREET

In breaking news CNBC’S Mary Thomson explains that the Treasury has asked Barclays [BCS  Loading...      ()   ] and State Street [STT  Loading...      ()   ] to manage their purchases of Freddie and Fannie mortgage-backed securities.

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CITI DROPS 20% AS WELLS FARGO BIDS FOR WACHOVIA

Shares of Citigroup [C  Loading...      ()   ] plunged lower after Wachovia [WB  Loading...      ()   ] announced a merger agreement with Wells Fargo [WFC  Loading...      ()   ]. The deal scraps a previous agreement in which Citigroup was to buy parts of Wachovia. Citigroup intends to sue.

I think it’s madness, says Guy Adami.

The interpretation is that if Citigroup can’t get the deal done, there might be more problems on their balance sheet, says Tim Seymour. But I don’t think that’s an accurate interpretation.

Keep an eye on USB [USB  Loading...      ()   ], JP Morgan