Hope you don’t have a weak stomach. The stock market is plunging and surging like a rag doll tied to a bungee cord. Here’s the word on the Street.
BACK FROM THE DEPTHS...S&P 500
The headline: The S&P 500 Finishes 3 Points Lower After Falling As Much As 2%; Dow Closes Little Changed After Being Down Nearly 200 Points.
Speculation the Federal Reserve would take action fueled the comeback, Karen Finerman says.
Pete Najarian adds that he loves volatility because it brings opportunities to buy stocks he likes on a dip.
The headline: NASDAQ Finishes Down 1% After Earlier Plunging As Much As 2.8%.
Dylan Ratigan asks why tech products, which usually contain micro chips are doing so well, when the chip makers are languishing.
Pete Najarian explains there’s too much competition in the chip space and he wouldn’t buy the current dip. On the gadget side, Pete feels the only worthwhile names are Research In Motion (RIMM), Nokia (NOK) and Apple (AAPL).
Jeff Macke adds that there’s also margin compression semi-conductors as one company tries to undercut the next.
The headline:Merrill Lynch (MER) Reports Worst Loss In Its History On $8.4B In Write-Downs.
Merrill's $2.24B loss is six times worse than the bank estimated earlier this month, explains Guy Adami. He wonders if Merrill has a handle on its own subprime exposure.
Jeff Macke agrees. He says avoid the financials.
Pete Najarian adds options traders are paying a premium for the November 33 straddle in the XLF, the exchange traded fund that tracks financials. He explains traders are betting on a big move in either direction.
Guy Adami likes Raymond James Financial (RJF) as a trade.
HOUSING WORST ON RECORD
The headline: U.S. Existing Home Sales Plummet 8% To Lowest Rate Since Records Began In 1999.
The White House economic team says housing market is not pulling us into recession, explains Karen Finerman.
MICROSOFT FACEBOOK STAKE
The headline:Microsoft (MSFT) To Invest $240M For Minority Stake In Facebook
CNBC’s Jim Goldman joins the panel for this conversation. Following are excerpts from what was said.
Why is this asset so valuable?
“Microsoft values Facebook at $15 billion. Every analyst I’m talking to is raising their eyebrows at this valuation,” says Goldman. “Remember News Corp (NWS) made a mess with MySpace….all the kids abandoned it saying it’s not cool anymore. What did they do? They jumped over the Facebook!”
He adds, “The worry is that Microsoft will do to Facebook what News Corp did to MySpace. Ultimately Google (GOOG) could be the winner as the wise man out.”
What is Google’s next move?
“Google has Orchid, which some say could be more powerful than Facebook,” replies Goldman.
Jeff Macke feels that $240 million purchase is pocket change for Microsoft.
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Trader disclosure: On Oct 24, 2007, 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 (DIS), (INTC), (ATVI), (YHOO) (EMC); Najarian Owns (C), (DISH), (EMC), (MSFT), (YHOO), (SNDK), (GOOG); Finerman Owns (GS); Finerman's Firm Owns (ASD), (BIIB), (CTX), (MSFT), (NYX), (NMX), (TGT), (WMT), (PLCE), (MO), (C); Finerman's Firm Owns S&P 500 Puts; Finerman's Firm Owns Russell 2000 Puts; Finerman's Firm And Finerman Own (HD), (C), (FLS), (KALU)