DOW SURGES IN FINAL HOUR
The Dow leaped on Thursday, as investors snapped up beaten-down shares only 24 hours after Wall Street's worst day since the 1987 stock market crash.
Discount retailers, such as Wal-Mart and healthcare companies drove indexes higher as investors bet their profits will prove more resilient in the event of an economic downturn.
How Are Your Trading?
This was as wild a day as any, muses Karen Finerman. When the market is up I take some off the table and when the market is down I buy a little.
I think there are opportunities in the market, counsels Pete Najarian. The Volatility Index indicates movement but not always downward movement. I expect more movement over the next couple of days.
The market is going through a digestive process, adds Joe Terranova. There are a number of expirations coming but I expect the market to make a bottom by October 24th.
Look for the Dow to trade in a range; between 8300 and 9800, says Guy Adami. When it goes higher you should sell and when it goes lower you should buy.
GOOGLE SURPRISES STREET
After hours Google reported a profit that easily outpaced analysts' forecasts as the Web search and advertising leader withstood deepening economic turmoil around the globe, and the company's shares jumped in extended trading.
Google killed, says Pete Najarian. Everything is working for them. And you know what, they’re hiring.
I don’t think the 25 multiple for Google is outrageous, says Guy Adami. I think it’s appealing as a value play.
The strong dollar probably cost the some profits and they still did well, adds Joe Terranava.
COMMODITY UNWIND CONTINUES
Oil prices closed at a new 14-month low beneath $70 a barrel Thursday, bringing its price to less than half its July record high after the government reported massive increases in U.S. crude and gasoline supplies.
Meanwhile, OPEC said on Thursday it would hold an emergency meeting next week suggesting they might attempt to reduce supplies.
When oil broke $70 I thought there would be selling pressure, says Joe Terranova. But there wasn't. Maybe it’s found a bottom.
I think the trade is gasoline, says Guy Adami. I’d recommend looking at gasoline.
Some of the oil field services companies look appealing to me and I own them against the USO , Karen Finerman says.
What do you think? Tell us now!
And for a commodity trade, I’d look at Nucor and Freeport McMoRan . The P/E levels look interesting to me.
MORE HEDGE FUND TROUBLES
Facing heavy losses and deteriorating market conditions, Highland Capital Management said it will shut down two hedge funds which built their records by investing in ailing companies.
Meanwhile, Citadel Investment Group acknowledged having "by far" the worst month in its history last month and said its largest fund is down close to 30 percent in 2008
Overall, there are a lot of hedge funds out there in the world that are run by fairly young people. They haven’t seen the ups and downs that seasoned traders have seen, explains Joe Terranova. You have to ask yourself if they understand the risks that they are taking.
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Trader disclosure: On Oct.16, 2008, 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), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Pete Najarian Owns (AAPL), Is Short (AAPL) Calls, Owns (AAPL) Puts; Pete Najarian Owns (C) Put Spread; Pete Najarian Owns (GS) Call Spread; Pete Najarian Owns (MS), Is SHort (MS) Calls, Owns (MS) Puts; Pete Najarian Owns (YHOO) Call Spread; Pete Najarian Owns (SLB) And Is Short (SLB) Calls; Pete Najarian Owns (SCHW) And Is Short (SCHW) Calls; Finerman Owns (GS); Finerman's Firm Owns (MSFT), (DEO), (MO); Finerman's Firm Owns (DNA) Call Spreads; Finerman's Firm Is Short (USO), (IYR), (IJR), (MDY), (SPY), (IWM); Terranova Owns (AAPL), (EXM), (FCX), (FTO), (MA), (NOV), (POT), (X), (VLO);
Terranova Is Co-Portfolio Manager Of The Virtus Diversifier PHOLIO; Virtus Diversifier PHOLIO Owns (IGE), (DBC), (DBV)
Terranova Is Chief Alternatives Strategist Of Virtus Investment Partners, Ltd.; Virtus Investment Partners Owns More Than 1% Of (ABD), (ARE), (BIG), (CNW), (OFC), (DLM), (DRH), (DLR), (EPR), (EXR), (FL), (SLB), (LNET), (MAC), (DBC), (DBV), (SKT), (UA), (BLV), (VV), (CLB), (GWX), (IGE), (FSMXX); Virtus Investment Partners Owns Seagate Tax Refund Rights; Virtus Investment Partners Owns Seagate Technology Tax Refund Rights; Virtus Investment Partners Owns More Than 1% Of Shares Of Incitec Pivot Ltd.; Virtus Investment Partners Owns More Than 1% Of Shares Of Essex Property Trust Inc.
GE Is The Parent Company Of CNBC; Charles Schwab Is A Sponsor Of "Fast Money"