Top Takes: Ford/Toyota, Tech

Here's what some of our market pros are saying and playing.
By RealMoney Staff ,

The RealMoney contributors are in the business of trading and investing all day on the basis of ongoing news flow. Below, we offer the top five ideas that RealMoney contributors posted today and how they played those ideas.

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1. BlackRock Will Benefit from Fidelity Move

By Don Dion

5:52 a.m. EST

Fidelity Investments' move to offer 25 iShares ETFs commission-free could have major positive implications for

BlackRock

(BLK) - Get Report

and negative implications for

Schwab

(SCHW) - Get Report

. BlackRock already dominates the now trillion-dollar ETF industry with a market share of over 50% with its iShares ETFs. Adding Fidelity as a partner that can bring much firepower and millions of customers will only solidify its top position.

In 2009, Schwab introduced its own ETFs and offered them commission-free to its customers but did not offer ETFs from providers such as iShares that are independent from itself on a commission-free basis.

No positions

2. Credit Spreads Opening Tighter

By Tom Graff

8:29 a.m. EST

Corporate bonds are opening stronger vs. Treasuries, even before the ADP number. Demand in Europe was strong, and I'm hearing that real money is feeling a bit more confident after the European Central Bank voiced approval of Greece's fiscal plans. Greece CDS are 20 basis points tighter.

Financials are 3-5 tighter, and most other sectors 1-3 tighter.

I remain skeptical of credit in the short term. I think we're riding one big massive techincal wave, mutual fund flows, which are bound to reverse. Yes, timing that reversal is tough. But I say that if investors are willing to "increase risk" by trading out of money markets and into long-term bond funds, how long before they trade out of bond funds and into equities?

I think over the next 12 months credit is likely to outperform Treasuries, but in the near term I believe there will be a better entry.

No positions

3. Ford and General Motors Could Gain at Toyota's Expense

By Don Dion

8:40 a.m. EST

The news from

Ford

(F) - Get Report

and General Motors continues to be good -- they reported solid growth in sales for January. Both Ford and GM solidified their positions as the two bestselling automakers while

Toyota

(TM) - Get Report

struggled with its runaway cars. The new U.S. investigation of Toyota will only continue to benefit Ford and GM. Toyota buyers tend to be security-minded, so the recall, crashes and deaths could cause them to shift to high-quality American brands, which Ford and GM now have available for sale on dealer lots.

Long F.

4. S&P Retracement

By Robert Moreno

9:38 a.m. EST

When I last posted on Jan. 25, I noted the

striking technical similarities

between the

S&P 500

in late 2002/early 2003 and the index in late 2008/early 2009, and suggested the correlation might be used to project price action over the next five months.

In 2003, the market came off a March low, breaking through important resistance at 950. It powered ahead to 1165 and paused over the next five months, pulling back about 8.7%. In 2009, the market came off a March low and broke through resistance at the 950 level, climbing to 1150 in early January of this year. I speculated that if we continued to track the 2003/2004 period, we'd see an 8.7% retracement over the next five months.

When I got back to work, yesterday, I was surprised to see we had had a pullback of about 6.5% -- but within five days, not over five months. We have since rallied nicely from an oversold condition, but formidable resistance sits at 1113 (50-day moving average) and 1124 (the 50% retracement of the 2007 high to 2008 low). The trend indicators (weekly MACD, daily ADX) still point lower.

No positions

5. Don't Trust This Tech Rally

By Ken Shreve

2:42 p.m. EST

There has been enough technical damage done to the market in recent weeks (not a lot, but enough) to make me skeptical about today's rally. I believe the trend is still downward.

It just doesn't feel right. Volume seems to be lackluster -- tracking about average -- in names like

Apple

(AAPL) - Get Report

,

Amazon

(AMZN) - Get Report

and

Priceline

(PCLN)

. If volume were noticeably heavier, I'd be more impressed. Some China names are also bouncing but I think this trade is long in the tooth as well.

No positions

This article was written by a staff member of RealMoney.com.

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