'Fast Money' Recap: CountrySlide
The stock market was hit with another devastating blow on Monday after New York Senator Chuck Schumer asked regulators to take a closer look at Countrywide Financial (CFC) . The Dow closed down 237 points and the Nasdaq finished down 55 points. The team at CNBC's "Fast Money" reviewed the bearish events and how housing concerns continue to push the market down.
In Karen Finerman's opinion, Chuck Schumer was being politically opportunistic. Jeff Macke remarks that this market continues to look for reasons to sell off. For Pete Najarian, the story of the day was the financials, which were terrible. Najarian continues to hold his put options positions on the financial names. Guy Adami recommends watching the 1400 level on the S&P 500. He predicts that a close below that level will take the Dow to 12,000.
Dennis Gartman Speaks
Dennis Gartman, author of "The Gartman Letter" joined the "Fast Money" crew to discuss his take on the markets. Gartman thinks the market looks very weak with stocks opening higher but then closing on the lows. He is worried that the public investor hasn't even begun to sell yet and the psychology of the consumer is changing. He recommended watching the Investors Business Daily chart of mutual fund holdings, which is now down on the year.
Gartman disclosed that he is long
Transocean
(RIG) - Get Transocean Ltd (Switzerland) Report
,
Microsoft
(MSFT) - Get Microsoft Corporation Report
and
Apple
(AAPL) - Get Apple Inc. Report
. He is short
Tiffany's
(TIF) - Get Tiffany & Co. Report
TheStreet Recommends
and
Countrywide
(CFC)
.
(One investor put together a bear market portfolio on Stockpickr.com, see
.)
Housing Data Trade
Finerman thinks the homebuilders are in serious trouble and she predicted that some will go bankrupt. Both new home sales and existing home sales figures will be released Wednesday and Thursday of this week. Adami suggests looking at
Acuity Brands
(AYI) - Get Acuity Brands Inc. Report
, a home furnishing company which is down 45% from its 52-week high and has a 12% short interest. Another name is a diversified electronics company named
Thomas and Betts
(TNB)
that provide heating and ventilation products.
Holiday Shopping
ShopperTrak reported that Friday and Saturday sales totaled $16.4 billion, a 7% increase over last year. Adami mentioned that Morgan Stanley raised its price target on
MasterCard
(MA) - Get Mastercard Incorporated Report
to $215. He feels that the story for MA is still in tact as a transaction trade.
Wall Street Whale Bill Ackman raised his stake in
Borders
(BGP)
from 11% to 17.1%. Finerman thinks it's interesting that the CEO of Borders is also buying stock. Adami mentioned that 19% of the float is short and it could be worth a trade for a short squeeze. However, Macke isn't excited about this company or stock.
(Here's one portfolio that is a list of favorite holiday 2007 stocks
.)
Tech Conference
Credit Suisse will be holding a major technology conference that starts on Tuesday. Najarian recommends that investors watch
Intel
(INTC) - Get Intel Corporation Report
and
eBay
. Anything positive out of eBay could move the stock higher. Adami prefers
Hewlett Packard
and expects that it will trade to $55.
Finerman still likes
Microsoft
(MSFT) - Get Microsoft Corporation Report
and she is intrigued by the idea of being long
EMC
(EMC)
and shorting
VMware
(VMW) - Get VMware, Inc. Report
. She thinks that the long EMC/Short VMW trade has really collapsed. Adami argues VMW should be in the $90s and EMC should be at $20.
Option News
Najarian noted unusual options activity in airlines like
Northwest
(NWA)
and
Delta
(DAL) - Get Delta Air Lines Inc. Report
. He mentioned that options players were rolling out of December $15 calls and into March $17.50 calls on Delta, and rolling out of December $15 and $20 calls and into March $17.50 calls on Northwest. Najarian remarked that volume on these trades were heavy.
Pops & Drops
Pops -
Garmin
(GRMN) - Get Garmin Ltd. (Switzerland) Report
traded up 5% as investors try to get ahead of a hot gadget trend for Christmas. However, Finerman doesn't think that GRMN is a "must own" stock.
Mattell
(MAT) - Get Mattel Inc. Report
and
Hasbro
(HAS) - Get Hasbro Inc. Report
traded up 1% and 2% ahead of Christmas. Macke thinks HAS is the cream of the crop and he is long the stock.
Deere
(DE) - Get Deere & Company Report
traded up 1% after Bank of America upgraded the stock. Adami continues to like DE.
GameStop
(GME) - Get GameStop Corporation Report
traded up 3%. Najarian admired the nice pop.
Drops -
Yahoo
(YHOO)
fell 4% after servers went down at the company. Adami isn't a fan of this stock.
Pfizer
(PFE) - Get Pfizer Inc. Report
fell 3%. Najarian thinks this stock will continue to fall, until the company does a takeover to bring growth back.
Circuit City
(CC) - Get Chemours Company (The) Report
fell 8%. Macke says nothing goes to zero in a straight line, except Circuit City. Investors are better off sticking with
Best Buy
(BBY) - Get Best Buy Co. Inc. Report
.
Tesoro
(TSO)
fell 8% after Kirk Kerkorian commented that the company had become less valuable after adopting a poison pill. Finerman wasn't happy about the comment.
Final Trade
The team finishes another down day with trade ideas for viewers.
- Macke tells investors to buy the S&P 500 Index (SPY) - Get SPDR S&P 500 ETF Trust Report with a stop at 1395.
- Adami recommends JetBlue (JBLU) - Get JetBlue Airways Corporation Report.
- Finerman suggests shorting Big Lots (BIG) - Get Big Lots Inc. Report.
- Najarian likes Arch Coal (ACI) - Get Albertsons Companies Inc. Class A Report for a play on global growth.
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