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Will Deal Making Keep Floor Under Market?

Deal making is officially back on with three major takeovers announced Monday.

Specifically, AIG inked a deal to sell its life insurance unit in Asia; German conglomerate Merck KGaA
bought Millipore in a deal valued at $7 billion and Japanese drugmaker Astellas Pharma launched a hostile $3.5 billion bid to acquire OSI Pharmaceuticals .

And it seems betting on M&A can generate some pretty impressive returns. Two of the S&P's best performing stocks this year have been acquistion targets.

Top 5 S&P Stocks Year-To-Date
Smith International (inked a deal with Schlumberger)
Millipore (mentioned above)
Zions
Eastman Kodak
Genworth Financial

Considering the flurry of activity, will deal making keep a floor under this market? What must you know?

The AIG deal is not a strategic deal, explains Gary Kaminksy. That’s a company liquidating and they found a buyer. I need to see strategic deals to feel confident we've found a floor.

But the AIG deal shows that there are people that have cash to spend, counters Tim Seymour. That’s a positive.

Many of these deals have multiple bidders, adds Karen Finerman. I consider this M&A at its best. I’m keeping an eye on OSI Pharma. I think it could attract further interest. And I sold half of my position in Millipore, she reveals. But maybe I should have taken profits in my entire position. I’m just being greedy now but, largely, I think there could be other bidders out there.

I agree, echoes Pete Najarian. It wouldn’t surprise me to see somebody else step in. I’m keeping an eye on Roche.

If you’re bullish on M&A and want a pure M&A play, I’d get long Greenhill , counsels Guy Adami.

Or why not look at Lazard, adds Pete Najarian.

Don’t forget Goldman has been involved in almost all of these deals, adds Tim Seymour.

For a downstream trade on the Millipore acquisition, I’d keep Pall Corp. on the radar, counsels Gary Kaminsky. I'm hearing that activists are circling the name.

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NASDAQ GOES POSITIVE FOR YEAR

So far this year, tech hasn't been a hotbed of merger activity, but Silicon Valley stocks with tons of cash on their books led the market higher Monday, sending the Nasdaq into positive territory for the year.

Will tech M&A drive the next leg higher?

I’ve noticed unusual options action in a few names, says Pete Najarian. They follow:
- Apple
- Sandisk
- Qualcomm
- JDSU

I’m watching Qualcomm, adds Guy Adami. I think the bottom is $34. And I’m watching the monster move in Amazon . I’d take profits in that stock.

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BIG TRADES SPIKE NEW YORK TIMES MID-DAY

Big money flowed into shares of the New York Times Monday. In fact the stock traded 4 times its average daily volume as a rumor circulated that Carlos Slim was looking to buy the remaining 93% of the company he doesn't own.

Although CNBC confirmed through a Slim rep that the billionaire has no plans to buy the whole company, the Gray Lady still finished considerably higher.

What must you know?

What’s interesting is that after the denial the stock continued to trade higher, muses Gary Kaminsky.

There’s a huge short interest in NYT, adds Guy Adami. And I also believe where there’s smoke there’s fire.

But I think the way the shares work the company can’t be sold unless the family agrees, adds Karen Finerman. I believe there’s a separate class of shares.

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STREET FIGHT: IS M&A GOOD SIGN FOR MARKET?

M&A activity was strong enough to juice the Dow Monday - but Miller Tabak strategist Peter Boockvar says, "not so fast." He thinks M&A is just a red herring.

Find out why! Watch the video now!



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Trader disclosure: On March 1st, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Kaminsky Owns (EPV); Kaminsky Owns (LULU) Puts; Najarian Owns (BAC) Call Spread; Najarian Owns (INTC) Calls; Najarian Owns (JDSU) Calls; Najarian Owns (MRVL); Najarian Owns (NTAP) Calls; Najarian Owns (AKAM); Najarian Owns (MRVL); Najarian Owns (NTAP) Calls; Seymour Owns (AAPL), (BAC), (F), (INTC), (NIHD); Kelly Owns (FXY) Puts; Finerman's Firm Owns (MIL); Finerman's Firm Owns (OSIP); Finerman's Firm Owns (XBI); Finerman's Firm Owns (IBB); Finerman's Firm Owns (ARG) Calls; Finerman's Firm Owns (GGWPQ); Finerman's Firm Owns (SII) Call Spreads; Finerman's Firm Owns (ACL); Finerman Owns (AAPL); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (QCOM); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Owns (BAC) Preferred, (BAC); Finerman's Firm And Finerman Own (JPM); Finerman's Firm Owns (IBM); Finerman's Firm Owns (MIL); Finerman's Firm Owns (OSIP); Finerman's Firm Owns (XBI); Finerman's Firm Owns (IBB); Finerman's Firm Owns (ARG) Calls; Finerman's Firm Owns (GGWPQ); Finerman's Firm Owns (SII) Call Spreads; Finerman's Firm Owns (ACL);
Terranova Owns (GLD) March Puts; Karabell Owns (RIMM), (UYG), (AAPL), (NOK), (XES), (VALE), (TC); Jon Najarian Owns (AAPL), Is Short (AAPL) Calls; Jon Najarian Owns (BAC), Is Short (BAC) Calls; Jon Najarian Owns (C), Is Short (C) Calls; Jon Najarian Owns (GS), Is Short (GS) Calls; Jon Najarian Owns (MIL), Is Short (MIL) Calls; Jon Najarian Owns (MS), Is Short (MS) Calls; Jon Najarian Owns (QCOM), Is Short (QCOM) Calls; Jon Najarian Owns (RIMM), Is Short (RIMM) Calls; Jon Najarian Owns (WFC), Is Short (WFC) Calls; Jon Najarian Owns (WMT), Is Short (WMT) Calls; Jon Najarian Owns (TSL) Call Spreads; Jon Najarian Owns (SII) Call Spreads; Jon Najarian Owns (CRM) Call Spreads; Jon Najarian Owns (MU) Call Spreads; Nations Owns (MSFT), (SPY)

For Tim Seymour:
Seygem Asset Management Is Short (FCX)
Seygem Asset Management Owns (VIP)
Seygem Asset Management Owns (VIP)

For Brian Kelly:
Kanundrum Capital Owns (C)
Kanundrum Capital Owns (JPM)
Kanundrum Capital Owns (CS)
Kanundrum Capital Owns (DB)
Kanundrum Capital Owns (NBG)
Kanundrum Capital Owns (EWP)
Kanundrum Capital Owns (EWJ)
Kanundrum Capital Is Short Yen
Kanundrum Capital Is Short British Pound
Kanundrum Capital Is Short Euro
Kanundrum Capital Is Short (GS)

For Joe Terranova:
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.


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