DOW REBOUNDS AFTER BREAKING 8,000
The Dow closed modestly higher on Thursday after investors brushed off negative sentiment and turned hopeful that falling oil prices might spur business and consumer spending.
The optimism helped stocks come back from earlier sharp losses that drove the benchmark S&P 500 down more than 3 percent intra-day.
FINANCIALS CONTINUE BUMPY RIDE
The financials had a rough day due to reports that government officials are discussing a new aid package for Bank of America that would be similar to the financial lifeline given to Citigroup in November.
That rescue involved both a fresh capital infusion and government backing of billions in risky assets held by the bank.
While the size of the added capital injection isn't known, the government is considering guaranteeing between $100 billion and $200 billion of Bank of America's risky debt. So far, Bank of America has received a total of $25 billion in capital from the $700 billion Wall Street bailout fund, known as TARP. That includes $10 billion for Merrill Lynch, which Bank of America bought in a deal that closed Jan. 1.
Meanwhile the Senate voted to let Barack Obama spend the remaining $350 billion in the financial industry bailout fund created in October.
Strategy Session with the Fast Money Trader
The first traunch was thrown together and it had to be, says Karen Finerman. But I’m hoping that they learned a little and there are different terms attached to the second traunch. Personally, I’d like to see Bank of America cut the dividend if they receive more money.
There’s only been one good sequel in the history to sequels, bristles Jeff Macke. And that was Godfather II. I wish the senators wouldn’t try and tell us how to run banks. I’d like to see new banks created and run by people who know how to run banks.
I think it’s very unfair of us to sit here and judge the success of the TARP after only 3 months, argues Pete Najarian. And it’s worth noting that when we got down to 818 in the S&P the market turned. And at that very moment institutional investors stepped in and bought the XLF calls. I interpret that as a tradable move.
But we don’t need a trade, counters Jeff Macke. We need confidence in the system.
AFTER HOURS ACTION: INTEL
Intel said it would not provide detailed financial guidance due to economic uncertainty, but gave a first-quarter revenue figure for "planning" purposes that was below average Wall Street expectations.
The world's largest chip maker also reported fourth-quarter earnings per share of 4 cents, meeting Wall Street's lowered expectations after it issued a revenue warning last week.
Shares of Intel initially edged lower in extended trading, but then recovered to trade up 2 percent.
I think the bounce in the stock stems from so much bad news already being baked in, says Pete Najarian.
APPLE COMES ROARING BACK
Shares of Apple closed only modestly lower despite word that CEO Steve Jobs will take a leave of absence till June because of health problems "more complex" than thought.
Boy they did a terrible job with this, muses Karen Finerman.
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Trader disclosure: On Jan. 15th, 2008, 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 (APPL), (TM), (MCD), (DIS); Seymour Owns (AAPL), (BAC), (EEM), (F), (INFY), (TSO); Najarian Owns (MSFT); Najarian Own (NVDA) Calls, (XME) Calls, (XLF) Calls; Najarian Owns (CSCO) & (CSCO) Short Calls; Najarian Owns (FCX) Stock & (FCS) Short Calls; Najarian Owns (HSBC) Put Spread; Najarian Owns (PALM) Call Spread; Najarian Owns (XLB) Call Spread; Finerman's Firm Owns (DSX); Finerman's Firm Is Short (VNO), (IYR), (IJR), (IWM), (MDY), (SPY), (USO), (ANF); Finerman's Firm Owns (MSFT) & Put Spreads; Finerman's Firm Owns (DNA) & Call Spreads
CNBC.com with wires