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Halftime—Jon Najarian: Financial to Watch

Friday, 10 Sep 2010 | 1:52 PM ET

Options trader Jon Najarian has a potential takeover candidate on his radar after spotting some unusual activity in the financials Friday.

The "flavor of choice," he said, has been Hartford Financial , which is experiencing "very strong, unusual call activity" in the Sept. 23 and Sept. 24 calls because of takeover chatter. Europe's largest insurer, Allianz , is rumored to be the buyer, but neither company would return Najarian's request for comment.

Shares of HIG are about $8 under its 52-week high, so he thinks some might view it as a "relative value."

Elsewhere in the financial space, the desk continues to watch European banks. The Financial Times reports that Deutsche Bank could announce its offering early next week. As a result, the Frankfurt, Germany-based bank traded higher Friday.

"I think it's interesting all those European banks very quickly recouped that break that occurred yesterday on Deutsche Bank," said Steve Cortes, founder of Veracruz.

Cortes is interested in Banco Santander , a Madrid, Spain-based bank that has been a "bellwether for European macro risk." The Spanish financial institution is rumored to have plans for a $3 billion takeover of a Polish bank, he said. Cortes thinks it's a "serious sign of strength," as reflected in its high share price Friday.

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CALL TO THE FLOOR: ACME PACKET

Acme Packet , a Bedford, Mass.-based technology company, has had an impressive run in the last year. But can it continue?

"We're at the beginning of a multi-year, broad sector trend," said CEO Andy D. Ory. "Fundamental shifts are occurring and we're taking advantage of that."

Hundreds of billions of dollars in telephone calls are being moved from the telephone network to computer networks, explained Ory. Acme Packet makes technology that enables computer networks to deliver those services. He said the company is also helping offer new services, like high-definition mobile video, distance learning and gaming.

Marketwise, he said one of the company's biggest drivers is from China, where business has doubled. North America, which he loosely defined as the US and Canada, accounts for 60 percent of revenue. Europe represents 25 percent of business and while some question the stability of the economy there, Ory said demand has not fallen off. He expects all geographical locations to continue to outperform.

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TRADING BEST BUY BEFORE EARNINGS TUESDAY

The "Fast Money" traders took their position on Best Buy before it reports quarterly earnings results before the bell Tuesday.

One way or another, the stock will move significantly when those earnings come out, said Joe Terranova, chief market strategist of Virtus Investment Partners. While there may be a slowdown in PC sales, there is strength in electronic devices, like Apple's iPad. He thinks it's hard to tell which way BBY will go.

Steve Grasso of Sturart Frankel said his clients are staying away from Best Buy because of a weak consumer and Veracruz founder Steve Cortes called it "Worst Buy."

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CALL THE CLOSE

Jon Najarian, co-founder of optionMONSTER.com, likes the market going into next week because fo potential M&A activity.

Joe Terranova, chief market strategist at Virtus Investment Partners, said it's time to take a position in agriculture and precious metals.

Steve Cortes, founder of Veracruz, recommends investors take profits.

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Trader disclosure: On Sept. 10, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Cortes is short gold; Terranova Owns (APA), (AXP), (ARUN), (AAPL), (BMO), (RSH), (FCX), (GS), (IBM), (JOYG), (MRVL), (ORCL), (C), (POT), (GLD), (XBI), (SU), (X), (UPL), (SPLS), (OXY), (QCOM); Grasso owns (ASTM), (BA), (BAC), (C), (CSCO), (JPM), (LPX), (MO), (MOT), (NDAQ), (PFE), (PRST)

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 (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 (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 (XLB)
Virtus Investment Partners own more than 1% of (XLP)
Virtus Investment Partners own more than 1% of (XLY)
Virtus Investment Partners own more than 1% of (XLF)
Virtus Investment Partners own more than 1% of (XLI)
Virtus Investment Partners own more than 1% of (XLU)
Virtus Investment Partners own more than 1% of (SUBK)
Virtus Investment Partners own more than 1% of (WDFC)
Virtus Investment Partners own more than 1% of (YDNT)
Virtus Investment Partners own more than 1% of (DLUEY)
Virtus Investment Partners own more than 1% of (DRYS)

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 (GERN)
Stuart Frankel & Co and it’s partners own (HPQ)
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 (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 Adam Holt
As of August 31, 2010, Morgan Stanley beneficially owned 1% or more of a class of common equity securities of the following companies covered in Morgan Stanley Research: Autodesk, NetSuite, Red Hat, Inc., Salesforce.com.

Within the last 12 months, Morgan Stanley managed or co-managed a public offering (or 144A offering) of securities of Adobe Systems, Fortinet Inc., Microsoft, Oracle Corporation, QLIK Technologies Inc., SolarWinds, Inc., SuccessFactors.

Within the last 12 months, Morgan Stanley has received compensation for investment banking services from Adobe Systems, ArcSight Inc, Autodesk, Fortinet Inc., Intuit, Microsoft, Oracle Corporation, QLIK Technologies Inc., Red Hat, Inc., SolarWinds, Inc., SuccessFactors, Symantec.

In the next 3 months, Morgan Stanley expects to receive or intends to seek compensation for investment banking services from Adobe Systems, ArcSight Inc, Autodesk, Check Point Software Technologies Ltd., Citrix Systems Inc, DemandTec, Fortinet Inc., Guidance Software Inc., Intuit, Microsoft, NetSuite, Oracle Corporation, QLIK Technologies Inc., Red Hat, Inc., RightNow Technologies, Inc., Salesforce.com, SolarWinds, Inc., Sourcefire, SuccessFactors, Symantec, Taleo Corporation, VMware Inc, Websense Inc.

  Price   Change %Change
M5W
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ALV
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BBBY
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DBK
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HIG
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SAN
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CSFL
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AAPL
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