Fast Money Recap - Is IBM a Big Spender? (3/18/09)

Recap of CNBC's Fast Money, Wednesday March 18.

IBM (IBM), Sun Microsystems (JAVA), Hewlett Packard (HPQ), Semiconductors Holdrs ETF (SMH)

The Nasdaq rose higher on news IBM is buying Sun Microsystems for a 100% premium. Pete Najarian applauded IBM's aggressiveness, although he thinks the company might be paying too much. Guy Adami doesn't think the move makes competitor Hewlett Packard look shabby. Najarian thinks chips are performing well and would look at SMH.

Good as Gold? Anglogold Ashanti (AU), Kinross Gold Corp (KGC), SPDR Goldshares ETF (GLD), Mkt. Vector Gold Miners ETF (GDX)

Hedge fund manager John Paulson is buying AU and Kinross and David Einhorn is partial to GLD and GDX. With Fed reforms, inflation fears are renewed and these giants are buying gold as a hedge. Joe Terranova thinks gold is the kind of investment to buy and hold and Pete Najarian does not advise chasing gold stocks. Guy Adami thinks goldbugs are more likely to lose money than to make money.

Fed's New Plan

Stocks rose on news the Fed will buy long-term Treasury bonds to stimulate the economy. Banks and homebuilders moved up on the news. Tim Seymour notes the market likes the emphasis on housing, and Guy Adami thinks the market is going to rise higher.

Bank of America (BAC), Financial Sector SPDR XLF (XLF), Citigroup (C), Morgan Stanley (MS), JP Morgan (JPM), Goldman Sachs (GS), Banco Bradesco (BBD), Uniao de Bancos Brasileiros (UBB)

Bank of America CEO Kenneth Lewis said the bank would probably return the the $45 billion in TARP it borrowed by early 2010. He added the bank did have funds now, but needed to preserve capital in an unstable environment. Melissa Lee noted the XLF is up 51%, indicating a bullish sentiment in financials. Guy Adami recommended caution in financials and for those who must own shares of Citi, opt for preferred stock. Joe Terranova pointed out Geithner has not yet spoken and it might be worthwhile to buy Morgan Stanley, JP Morgan and Goldman Sachs. Tim Seymour likes Brazilian banks Banco Bradesco and Uniao de Bancos Brasileiros.

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