'Fast Money' Recap: Oil Gushes Forth

Joe Terranova joins the show to talk about oil trends.
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Oil touched $100 a barrel for the second day in a row on Thursday and the stock market barely reacted. The Dow closed up 12 points and the Nasdaq finished down 6 points. The crew at CNBC's "Fast Money" took a look at oil, gold and agriculture.

Oil Trade

Joe Terranova, Director of Trading at MBF Clearing Corp., joined the "Fast Money" crew to discuss his take on oil. Terranova explained that historically oil tends to get cheaper as the spring approaches and gas prices rise as the summer driving season approaches. He thinks this trend will increase the crack spread and benefit the refiners. Terranova recommends accumulating stock in the refiners heading into Martin Luther King Day and have the position in place by President's Day. He would then look to take profits in March if the trade works out.

Jon Najarian thinks oil is displaying a head fake and is setting up to disappoint the bulls. He suggests shorting the refiners until mid-February and then flipping to the long side. Macke thinks these trades are very complicated, so he would simply buy

United States Oil Fund

(USO) - Get Report

.

(Here's how the pros do it on Stockpickr.com

Profunds Oil & Gas

.)

Bling

Gold hit another new high Thursday trading up to $869.10. Tim Seymour predicts that with gold performing so strongly, the miners are ripe for takeovers. Having said that, he likes

Harmony Gold Mining

(HMY) - Get Report

and

Gold Fields

(GFI) - Get Report

for takeover plays in the gold mining sector.

Macke disagrees with Seymour and instead he would sell the mining stocks and buy the

Gold ETF

(GLD) - Get Report

. Najarian mentioned that the options players are selling calls on the mining names like

Newmont Mining

(NEM) - Get Report

, Gold Fields and

Goldcorp

(GG)

. Adami maintains that if you want to participate in the mining space buy

Freeport-McMoRan

(FCX) - Get Report

.

Ag Stocks Bloom

Agriculture stocks were on fire Thursday after

Monsanto

(MON)

reported fist-quarter profits that nearly tripled. Adami remarked that this quarter was unbelievable and the story is real. He would stay with Monsanto, but he does think it will pullback. Najarian explained that traders are moving into agriculture stocks for their safety. Macke recommended not being piggish on these stocks and taking some profits in names like

Agrium

(AGU)

,

Potash

(POT)

,

Mosaic

(MOS) - Get Report

and Monsanto.

(Take a look at this portfolio on Stockpickr.com

Agriculture and Fertilizer Index

.)

Jobs Report Preview

The December jobs report is set to be released on Friday morning. Michael Darda, the chief economist at MKM Partners joined the "Fast Money" crew to discuss his take on the jobs report. Darda explained that the data doesn't point to the US heading into a recession, but it does suggest the economy is slowing down. He feels that stock valuations are very reasonable when compared to bonds. Darda recommends going long stocks and shorting bonds if you have a 6-to-12 month time horizon.

Macke says get long the

Retail HOLDRS

(RTH) - Get Report

below $90 for a trade heading into the report. Tim Seymour explained that the bond market is pricing in a recession and he would continue to keep an eye on that development.

Word on the Street

Gaming stocks took a beating as investors grow concerned about the growth prospects in Macau. Macke thinks now is the time to build positions in names like

MGM

(MGM) - Get Report

and

Las Vegas Sands

(LVS) - Get Report

. Najarian agrees with Macke.

State Street

(STT) - Get Report

explodes up 8% after the company issued a bullish forecast and took a $279 million charge for legal costs related to poor investments on subprime mortgages. Adami reminded viewers that he brought up this stock in September. He now feels the valuation on STT is getting a bit rich. Macke commented that the stock rallied because the company was proactive on the mistakes it made with their money market funds tied to subprime investments.

Lenovo Group announces plans to enter the United States consumer PC market. Najarian thinks the play off this news is too short

Dell

(DELL) - Get Report

. He wouldn't short

Hewlett-Packard

(HPQ) - Get Report

because he feels they're better positioned to handle the competition from Lenovo.

Activist investor Bill Ackman says

Target

(TGT) - Get Report

will hit $120 in the next 3 years. Macke likes Target for the long term, but he thinks Ackman is just talking his book with this lofty price target.

Bed Bath & Beyond

(BBBY) - Get Report

fell 7% in after hours trading on lower-than-expected guidance. Macke says don't buy the dip on specialty retailers like BBBY ever.

Intel

(INTC) - Get Report

traded 2% lower on Thursday as the Bank of America downgraded continues to weigh on the chipmaker's shares. Adami doesn't understand why Intel is trading lower and he feels that he is either missing something on Intel, or it's a screaming buy. He thinks Intel's next quarter is going to be great.

Online Advertising Trade

With the Iowa Caucus set for tonight politicians continue to spend money online to raise awareness for their campaigns. JP Morgan is predicting that online spending could reach $10 billion in 2009. Najarian thinks

Google

(GOOG) - Get Report

will benefit from this trend, but his best idea is

Yahoo

(YHOO)

. Adami prefers

Digital River

(DRIV) - Get Report

. Macke doesn't agree with Najarian on Yahoo. He feels Yahoo can't get out of their own way.

BRIC IPO Trade

As the BRIC (Brazil, Russia, India and China) markets continue to grow investors will see more IPO's from these emerging markets. Seymour thinks the way to play this trend is with the underwriters like

UBS

(UBS) - Get Report

,

Morgan Stanley

(MS) - Get Report

,

Goldman Sachs Group

(GS) - Get Report

and

Credit Suisse Group

(CS) - Get Report

which are the top BRIC underwriters.

Seymour also likes

China Mobile

(CHL) - Get Report

and

CNOOC

(CEO) - Get Report

for plays on moving off the Hong Kong exchange to the Shanghai. Adami also favors China Mobile. Najarian says play the exchanges like

Nasdaq Stock Market

I:IXIC

and

NYSE Euronext

(NYX)

because they will benefit from increased trading volumes from ADR transactions. He also likes UBS and he disclosed he owns all three of the above mentioned stocks. Macke agrees with Najarian on the exchanges.

Pops & Drops

Pops -

SINA Corp

(SINA) - Get Report

traded up 8% after Piper Jaffray raised its rating on the Chinese internet portal from neutral to buy. Seymour likes SINA.

Superior Energy Services

(SPN)

traded up 19% after signing a $750 million contract to dismantle downed platforms in the Gulf of Mexico. Adami agrees with Jim Cramer that SPN is a valuation trap. He would take profits off this pop.

Raytheon

(RTN) - Get Report

traded up 3% after the defense company won two U.S. Army contracts worth $18 million. Adami loves the defense stocks into 2008.

Sasol

(SSL) - Get Report

traded up 3% on no news. Seymour explained that as oil goes above $100 coal, it is comparatively cheap and that is bullish for SSL.

Drops -

Rite-Aid

(RAD) - Get Report

,

Walgreen's

(WAG)

and

CVS

(CVS) - Get Report

fell more than 6% each after all three reported December sales that missed Wall Street estimates. Macke isn't a fan of these stocks.

YRC Worldwide

(YRCW) - Get Report

fell 11% after the company reported that it will take up to $800 million in fourth-quarter acquisition charges. Najarian asks why own this stock?

Panera Bread

(PNRA)

fell 10% after the company reported a 1.2% decline in fourth-quarter same-stores sales. Najarian would look to buy it in the $30's.

NetSuite

(N)

fell 8%. Macke is still bullish and suggests buying the stock when it dips.

Shutterfly

(SFLY) - Get Report

fell 16% on no news. Najarian would say away from SFLY.

Family Dollar

(FDO)

and

99 Cents Only Store

(NDN)

fell more than 6%. Macke cautions investors not to own these stocks - retail is too hard right now.

Face2Face

Viewers send in the questions that they'd like the panel to answer.

John writes, "Guy, are you still bullish on

MasterCard

(MA) - Get Report

even with recession talk and a spending slowdown by consumers? It looks like it's ready to turn over on the charts." Adami expressed that he is still bullish on MA because people are spending money with plastic and moving away from using cash.

Bob wants to know,"What's going on with

McDonald's

(MCD) - Get Report

. It seems like we are having a McMess lately?" Macke thinks McDonald's is just fine as long as

Starbucks

(SBUX) - Get Report

exists.

Nadim asks, "Seymour, I know you love and follow Russia. But which picks do you think would be very nice for 2008?" Seymour's best ideas for Russia are

CTC Media

(CTCM)

,

Market Vectors Russia

(RSX) - Get Report

and

Gazprom

(OGZPY)

.

Final Trade

The team shares the trades they think have the most potential for profit.

  • Macke favors Cypress Semiconductor (CY) - Get Report.
  • Adami for the second day in a row picks Intel (INTC) - Get Report.
  • Seymour recommends Tata Motors (TTM) - Get Report because the company is buying Land Rover and Jaguar from Ford.
  • Najarian advises shorting Valero (VLO) - Get Report for a short term trade.

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