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Does IBM Win From Hewlett Packard Scandal?

Shares of HP plunged 10% after hours as investors scrambled to adjust their technology trades, stunned by word that HP CEO Mark Hurd was stepping down.

As if the resignation wasn’t surprising enough, to make matters that much more complicated, Hurd resigned in the wake of a sexual harassment probe. (Click here for more on that.)

HP immediately named Chief Financial Officer Cathie Lesjak as its interim CEO and said its board would search for a permanent replacement.

Considering Hurd is something of a rock star in the corporate world, how easily can he be replaced? How should you trade tech now?

Instant Insights with the Fast Money traders

I’m an HP shareholder and I’m concerned about these developments, says Karen Finerman. Mark Hurd is an important asset to the company. I don’t think anybody should jump in a buy HP right now. However I’m not planning to sell on the news – at least not right away.

I think we see shares fall on Monday, adds Steve Grasso, but I’m a buyer of the dip. The company is bigger than one person.

Market pros who invest in this stock are in it for the management, says Gary Kaminksy. I would not trade this stock on technicals or buy dips. I think there may be many money managers who just want this stock off the books and sell.

If investors are in HP for Mark Hurd and Mark Hurd is now gone then no longer will the stock have a Mark Hurd premium, adds Herb Greenberg. That's something to keep in mind.

If you're looking for a trade, I’d look at long IBM, says Terranova. I think money managers who are in HP for Hurd could rotate out of HP and into big blue on this news.

Even before this happened I’ve been seeing buy side interest in IBM and these developments will only exacerbate that buy side interest, adds Grasso. I agree that IBM gains from this.

Hear what Anthony Scaramucci as well as Collins Stewart analyst Louis Miscioscia have to say about these development. Watch the video above.

What do you think? We want to know!

Read More:

> HP CEO Resigns After Sexual-Harassment Probe


HP said Friday that Hurd decided to leave after the investigation into a sexual-harassment claim made against him and the company by a former HP contractor. The probe concludes that the company's sexual-harassment policy was not violated, but that its standards of business conduct were.

In a statement, Hurd said that during the investigation he realized there were instances in which he did not live up to the standards and principles of trust, respect and integrity that he had espoused at HP."

He added that he believed it would be "difficult to continue as an effective leader."



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Trader disclosure: On August 6th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Pete Najarian owns (CTRP) calls; Pete Najarian owns (DD) short calls; Pete Najarian owns (MCD) calls; Pete Najarian owns (CF) calls; Pete Najarian owns (RIMM) call spread; Terranova owns (AKAM), (APA), (BAX), (COP), (FCX), (GS), (MOS), (MSFT), (PFE), (POT), (SU), (XBI); Grasso owns (ASTM), (ABK), (BA), (BAC), (BGP), (C), (CSCO), (DYN), (JPM), (LPX), (MO), (MOT), (NDAQ), (PFE), (PRST); Finerman owns (AAPL); Finerman's firm owns (ARM); Finerman’s firm owns (BBY); Finerman's firm owns (LEA); Finerman’s firm owns (KFT); Finerman & Finerman's firm owns (RIMM); Finerman’s firm owns (TSX); Finerman’s firm owns (GYMB); Finerman’s firm owns (PLCE); Finerman's firm owns (WMT); Finerman's firm owns (DAN); Finerman's firm is short (IJR); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Finerman’s firm owns S&P 500 puts; Finerman’s firm owns Russell 2000 puts

For Joe Terranova
Terranova is chief market strategist of Virtus Investment Partners, LTD.
Virtus Investment Partners own more than 1% of (ABAX)
Virtus Investment Partners own more than 1% of (ALK)
Virtus Investment Partners own more than 1% of (AMKR)
Virtus Investment Partners own more than 1% of (CASS)
Virtus Investment Partners own more than 1% of (CSVI)
Virtus Investment Partners own more than 1% of (XLY)
Virtus Investment Partners own more than 1% of (XLP)
Virtus Investment Partners own more than 1% of (DRYS)
Virtus Investment Partners own more than 1% of (EXR)
Virtus Investment Partners own more than 1% of (XLI)
Virtus Investment Partners own more than 1% of (IGE)
Virtus Investment Partners own more than 1% of (LDR)
Virtus Investment Partners own more than 1% of (LPHI)
Virtus Investment Partners own more than 1% of (XLB)
Virtus Investment Partners own more than 1% of (MGRC)
Virtus Investment Partners own more than 1% of (NRCI)
Virtus Investment Partners own more than 1% of (DBV)
Virtus Investment Partners own more than 1% of (SUBK)
Virtus Investment Partners own more than 1% of (XLK)
Virtus Investment Partners own more than 1% of (XLU)
Virtus Investment Partners own more than 1% of (WDFC)
Virtus Investment Partners own more than 1% of (YDNT)

For Patty Edwards
Edwards owns (WMT) for clients
Edwards owns (COST) for clients
Edwards owns (MCD) for clients
Edwards owns (SBUX) for clients
Edwards owns (KFT) for clients
Edwards owns (GIS) for clients
Edwards owns (DD) for clients
Edwards owns (BRK.B) for clients
Edwards owns (RIMM)
Edwards owns gold for clients
Edwards owns platinum for clients
Edwards owns silver for clients
Edwards owns the Russell 2000 for clients
Edwards owns the S&P500 for clients

For Steve Grasso:
Stuart Frankel & Co and it’s partners own (BAX)
Stuart Frankel & Co and it’s partners own (COG)
Stuart Frankel & Co and it’s partners own (CUBA)
Stuart Frankel & Co and it’s partners own (DHR)
Stuart Frankel & Co and it’s partners own (DYN)
Stuart Frankel & Co and it’s partners own (GERN)
Stuart Frankel & Co and it’s partners own (HSPO)
Stuart Frankel & Co and it’s partners own (MERC)
Stuart Frankel & Co and it’s partners own (NWS.A)
Stuart Frankel & Co and it’s partners own (NYX)
Stuart Frankel & Co and it’s partners own (PDE)
Stuart Frankel & Co and it’s partners own (PFE)
Stuart Frankel & Co and it’s partners own (PRST)
Stuart Frankel & Co and it’s partners own (RDC)
Stuart Frankel & Co and it’s partners own (TBT)
Stuart Frankel & Co and it’s partners own (TLM)
Stuart Frankel & Co and it’s partners own (TRV)
Stuart Frankel & Co and it’s partners own (XRX)
Stuart Frankel & Co and it’s partners own (SDS)
Stuart Frankel & Co and it’s partners are short (QQQQ)

For Anthony Scaramucci
Scaramucci and SkyBridge Capital own (AAPL)
Scaramucci and SkyBridge Capital own (KO)


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