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Recap of CNBC's Fast Money, Wednesday May 21.

Oil Well Above $133

Jeff Macke said Wednesday was discouraging with less than hopeful news from the Fed and oil prices running amok on speculation rather than supply and demand. Guy Adami doesn’t think the correction is such a bad thing and would add to tech. Karen Finerman said she boosted her Citi position during the selloff. She said she will wait for a dip in retail before buying.

Airline Stocks Grounded: AMR (AMR)

AMR dropped 24% on rising oil, and Guy Adami says airlines are so hated that they are bound to bounce at some point. Jeff Macke agreed when the oil bubble pops, airlines will fly, but he wouldn’t be long airlines now. Pete Najarian is bullish on AMR, which he thinks made some good, tough decisions.

Retail Trail: B.J’s Wholesale (NYSE:BJ), Wal-Mart (NYSE:WMT), Costco (NASDAQ:COST)

BJ’s declined even though it reported strong numbers, although Macke said most of the upside was already priced into the stock. Finerman said the sector in general is not low enough to buy now. Macke likes Wal-Mart because it is aggressive in “getting in front” of its problems instead of just blaming the economy. Adami would buy COST ahead of its earnings report.

Microsoft (NASDAQ:MSFT) Buying Eyeballs: Valueclick (VCLK)

Macke called MSFT’s new cash back scheme a “buying eyeballs” strategy straight out of the 1990s and says the company seems desperate. Najarian noted heavy options activity in VCLK and thinks it would make a nice acquisition for Yahoo.

Stuck in the Hedges: Lehman Brothers (LEH), Merrill Lynch (MER), JP Morgan (NYSE:JPM), Citigroup (NYSE:C)

Dick Bove joined the program to discuss how big brokers could lose billions on the demise of hedge funds, particularly short indices. He says LEH, MER, and GS could drop 15-20% because of these losses. JPM and Citi are not so vulnerable, but may not report strong quarters. He predicts a turnaround for Citi, but not in the very near future.

Tech is Back: Hewlett-Packard (NYSE:HPQ), IBM (NYSE:IBM)

Joe Clark, Financial Enhancement Group Founder & CIO discussed news tech has beat out financials to become the largest sector in the S&P 500. He would buy large-cap tech stocks such as MSFT, HPQ and IBM, all of which he thinks will gain 20% in the next year. Clark says IBM and Microsoft will benefit from software upgrades in big companies and adds that while HPQ was dead money for a while, it should more than double.

Oil on Trial: Fluor (NYSE:FLR), Jacobs Engineering (NYSE:JEC), Oil Services HOLDRS (NYSEARCA:OIH), United States Oil Fund (NYSEARCA:USO)

Large oil companies were asked to answer for high oil prices as they testified before the Senate on Wednesday. The companies defended the prices, saying they were based on normal supply and demand and protested proposed windfall taxes which would cut profits. Karen Finerman thinks the companies will increase capital expenditures to conceal their earnings, and will beef up supply with continued explorations. She would consider USO and OIH as possible trades. Adami would be long oil services, since they are cheap on a valuation basis, and liked engineering companies FLR and JEC on a drop. Najarin would rather buy steel and coal.

Gartman and Masters

1990s commodities guru Michael Masters testified before Congress that speculation is driving oil and suggests preventing pension funds from investing in oil and would make it more difficult for financial institutions to forego limits on speculative positions. Dennis Gartman thinks this solution would interfere with the free market, but advocates making it more difficult for speculators to store oil and commodities for a lengthy period of time. Gartman praised the President for not adding to the Strategic Petroleum Reserve but would prick the oil bubble by selling some of the reserves. However, Gartman doubts the President will take this action. Gartman says the oil bubble is a perfect storm that may well turn into a hurricane.

Down on Natural Gas: ConcoPhillips (NYSE:COP), Exxon Mobil (NYSE:XOM), U.S. Natural Gas (NYSEARCA:UNG), Frontier Oil (NYSE:FTO), Valero (NYSE:VLO), Tesoro (NYSE:TSO)

Najarian notes GS downgraded some natural gas stocks, the volatility index has jumped and there have been selloffs in COP and XOM. However, UNG stood its ground. He said that while refiners such as TSO and VLO don’t seem to be working, he bought some FTO.

Hail to the Chief

The group discussed which candidate would benefit which sectors. The consensus is Obama’s victory will benefit alternative energy and defense, but would be a liability to the service sector, healthcare, coal and financials. McCain would benefit the aforementioned four sectors and would hurt ethanol. Adami says defense will thrive no matter who wins.

Final Trade: Macke: U.S. Oil Fund (USO), Adami: AMR. Finerman: Oil Services HOLDRs (OIH), with USO puts. Najarian: Disney (NYSE:DIS)

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Source: Oil on Trial - Fast Money Recap (5/21/08)