'Fast Money' Recap: Watch Where Bonds Are Headed
NEW YORK (TheStreet) -- The S&P 500 eked out a 0.14% gain on Friday, extending its winning streak to four consecutive sessions.
On CNBC's "Fast Money" TV show, Guy Adami, managing director of stockmonster.com, pointed out the big reversal in the iShares 20+ Year Treasury Bond ETF (TLT) on Thursday, signaling bond yields may be headed higher. He added that next week's action in the stock market could be pivotal in deciding its next big move.
Brian Kelly, founder of Brian Kelly Capital, said the directional market action is first noticeable in bonds via the TLT, then in the CurrencyShares Japanese Yen Trust ETF (FXY) before finally showing up in the SPDR S&P 500 Trust ETF (SPY). He questioned the sustainability of the current rally in equities.
Tim Seymour, managing partner of Triogem Asset Management, said financial and industrial stocks continue to do well. He said this week's U.S. economic data were good while China's economic data were decent.Dan Nathan, co-founder and editor of riskreversal.com, pointed out Chipotle Mexican Grill's (CMG) 11% intraday reversal to the downside. He added the stock is still very expensive and has rising input costs. Kelly suggested McDonald's (MCD) will likely have its margins squeezed as well due to rising input costs. Seymour said investors should wait for International Business Machine's (IBM) investor day to see if there are positive catalysts to help improve the business. Carter Braxton Worth, chief market technician at Sterne Agee, said the market has further downside ahead. Specifically, he said the PowerShares QQQ Trust ETF (QQQ) and the iShares Nasdaq Biotechnology ETF (IBB) -- which have fallen 9% and 25% from the highs, respectively -- could have more downside. He added that the Energy Select Sector SPDR ETF (XLE) looks to have 10% more upside. Kelly said he likes energy stocks, specifically natural gas stocks, at current levels. He was a buyer of Chesapeake Energy (CHK).
Seymour said Tesoro (TSO) and Southwestern Energy (SWN) seem poised to go higher.
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