Let the pummeling begin: European markets saw mid-single-digit percentage losses, with big banks taking a hit. Major Asian markets are off in the 4% to 5% range. The Dow is off triple digits; the NASDAQ and S&P are lower as well.

The only positive is that oil is down around $90 a barrel - a level it certainly hasn’t seen in a while.

Wachovia (WB)
There's talk of splitting Wachovia in two, with some to go to Citi (C), some to Wells Fargo (WFC). The Federal Reserve is reportedly pushing that arrangement. Wells Fargo may be winning the battle in the courts, however, at least for now: Citigroup's request for an extension of time in which to complete the deal was thrown out by the judge presiding over the case.

I wouldn’t wait for this tug of war to play out. If I were long Wachovia -- especially when it was trading in the $1 range -- I’d bail. I simply don’t think that the potential reward is worth the risk at this point.

Imclone (IMCL)
Well, it's official: Eli Lilly (LLY) is set to acquire biotech ImClone for $70 a share in cold hard cash. The big question now is whether Bristol-Myers (BMY) will man up and raise its $62 per share bid to get back in the game - and I think there’s a good chance that could happen. However, it’d have to come in at least a buck or 2 north of the Lilly offer in order for Icahn and crew to go along with it at this point.

ImClone has opened higher. If it trades above $68, I’d probably bail rather than wait for Bristol-Myers to possibly step up, or for the Lilly deal to close. Late in the fourth quarter or early in the first quarter is the expected close date.

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