'Fast Money' Recap: Steel's Your Ally

The U.S. stock market closed substantially higher Thursday on bullish Federal Reserve activity that looked to be a boon for the troubled financial sector. The Dow rose 2.2%, the S&P 500 ticked up 2.4% and the Nasdaq was up 2.2%. On CNBC's "Fast Money" TV show, Tim Seymour said that the market looked stable. He noted that U.S. policymakers had given a boost to mortgage insurers Fannie Mae (FNM Quote) and Freddie Mac (FRE Quote) and had encouraged investors by working in concert to aid the market.

Jeff Macke said that the Fed's action today burst bubbles that had been working for six months. He said the dollar short, the financial short, and the commodities bull market are all over. The Fed has changed the rules on trades that had been working, he said.

CNBC reporter Steve Liesman said that as the Fed began allowing investment banks access to the discount window and orchestrated Treasury swaps, credit concerns have eased. If you like what the Fed is doing, he said, they are doing more of it, buying commercial mortgage paper and collateralized debt obligations in exchange for tradable Treasuries. The Fed is making its balance sheet available to banks, he said.

Pete Najarian expressed confidence in the market. He cautioned viewers that the S&P 500 closed at 1330, where there has been a great deal of resistance. He said that not every commodity needed to get sold today. Oil and gold did, he acknowledged, but he said he saw an opportunity in agriculture. Potash (POT Quote) and Monsanto (MON Quote) had been over-hit and rallied big today, he said.

Adami said he's not a gold bull. He thinks that as the Fed stops the dollar short, gold will lose its upward momentum. For a real commodity trade, he said, look at steel. He called gold a speculator's instrument.

Najarian advised viewers to look at Newmont Mining (NEM Quote). Macke said Newmont is its own animal because it didn't follow gold on the way up.

Tim Seymour noted big moves in the dollar index. He said that not only are people moving out of commodities but they're also seeing less risk in U.S. markets, which will allow the dollar to rally more. He warned against lumping all commodities together. He said that Potash, Monsanto and Agrium (AGU Quote) had pricing power. He also liked the story on CVRD (RIO Quote) and BHP Billiton (BHP Quote). Adami recommended Joy Global (JOYG Quote).

For the Chart of the Day, the crew looked at Wal-Mart (WMT Quote). The stock looks poised for a breakout. Macke said that the retail giant had spent a decade in the penalty box, which helped contract its earnings multiple. He said the stock will continue to work.

FedEx (FDX Quote) released earnings today. Adami said the company didn't do anything in 2007. He called the most recent quarter good but noted "lousy" outlook. From a valuation standpoint, FedEx makes an interesting play, he said, but "I wouldn't run out and buy it." He suggested Ryder (R Quote).

Macke said the stock went up on bad news, which he believes is an incredible tell from a trading perspective.