The rate cut party heated up on Wall Street this week with the S&P 500 racking up the best weekly gains since March. The crew at CNBC's "Fast Money" reviews the effects the cut had on the stock market.
Pete Najarian thinks the
has eased the concerns on Wall Street with the rate cuts. Karen Finerman now feels that the fear from the credit scares and hedge fund blow ups has been lifted. Jeff Macke suggests the market replaced the credit fears with inflation fears, which are more long term worries. Macke recommends getting out of the dollar and spend instead.
Retail stocks continue to benefit from the Fed rate cut. Macke feels that Fed has lifted the recessionary fears near term. His choice is the best of breed retailers like
Take: Steven Smith said recently, "Circuit City continues to play second fiddle to Best Buy" To read more on what Smith said,
Commodities had a huge week with oil, gold and wheat making explosive moves. Dennis Gartman who writes the Gartman Letter joined the crew to discuss his take on the action in the commodities markets. Gartman declares that if you want to own gold, soybeans, oil and steel - own all the things that would hurt if you dropped them on your foot. He sees no reason for things to change until the next Fed meeting. In Gartman's opinion gold is going much higher in 3 to 6 months along with soybeans and corn.
Najarian's Tech Picking
reported strong earnings this week and PC growth forecasts helped to take technology stocks higher. Najarian maintains that
is going much higher. He also predicted that
will hit $200. (
Take: Jim Cramer said recently, "Oh, and my Apple channel checks are through the roof on both the Mac and the iPhone." To read more on what Cramer said,
traded higher after raising its share buyback by $5 billion. Najarian impressed by the TXN moves on the dividend and buyback, calls the stock the one to own right now.
also traded to a record high on Friday. Najarian says own Google because search is the real deal and plenty of growth is left. (
Take: Tero Kuittinen said recently, "The rumor mill around a possible Google phone debuting in the first half of 2008 kicked into high gear this week." To read more on what Kuittinen said,
Let's Make a Deal
On Friday news broke that KKR and Goldman pulled out of a deal to buyout
for $8 billion. (
Take: Jim Cramer said recently, "We will have many more blowups in the next few weeks like Harman. We will have more hedge fund destructions." To read more on what Cramer said,
Is the busted deal trend starting and how many deals will actually close for the rest of the year? Macke thinks everything has changed with the re-pricing of debt. He is running away from any trades that are deal driven. Finerman counters that all deals are different and investors need to check the terms of the deals to see if any of the parties have an easy way out. She's looking at
, because the lawyers have no room to get out of this deal. Najarian would play
because the options activity leads him to believe this deal will get done.
Fall TV Trade
The fall TV bonanza is beginning and advertisers are lining up to pitch their products in front of the biggest audiences.
Media Reporter Julia Boorstin joined the crew to discuss the best ways for investors to profit from the fall lineup. Boorstin thinks that ABC, controlled by
, is poised to benefit the most with a very solid lineup of new shows like Big Shots, Pushing Daisies and Cashmere Mafia. Macke agrees and he would own Disney for the long term.
Boorstin also mentioned that the ad model is moving online and the networks are giving away their shows. Adami thinks the way to play this trend is to buy the online ad giant
. Boorstin feels that NBC, which is owned by
, can only go up from here. New shows like Bionic Woman and Journeyman could do very well. (
Take: Steve Birenberg said recently, "I see ABC and FOX as best positioned from a financial and stock performance standpoint, and CBS as at risk. NBC is stable at a weak performance level, but even a big move in either direction gets buried within GE's massive hulk." To read more on what Birenberg said,
History has shown that the S&P 500 rallies into an election year no matter who the potential winner is. Since 1931, the S&P 500 has gained 14% in the pre-election years. Adami states that it's a good time to be long in equity right now and defense stocks are best no matter who gets in office. Najarian prefers technology stocks with
was in the news again as talks with the Unions are making progress. Adami would pick
over General Motors and he believes it will go above $9.
Quicker Then the Ticker
The crew likes to review which trade ideas went well. Here's some recent suggestions.
On September 6th Finerman gave out
for a play on a possible takeover. Meridian is up 15% since her call.
On September 7th Finerman recommended
. She hit pay dirt again with the stock exploding up 30% since her call.
On September 13th Macke told traders to short
. Macke nailed it with KMX falling 10% since his call.
It was September 14th when Najarian issued a buy call on
because he was noticing huge call buying in the options pits. Najarian hit a homerun with the stock up 15% since his call. (
Take: Dan Fitzpatrick said recently, "I've been writing about Cree for a while now, noting that this company is a great story stock because of the excellent growth prospects within the LED industry." To read more on what Fitzpatrick said,
Back on August 16th Adami called a bottom in
. Adami was right and GS shot up 22% since his call. (
Take: Jim Cramer said recently, "Goldman's now just the best house in a real subprime neighborhood." To read more on what Cramer said,
However, some trade suggestions didn't work out as planned. Here are the ones that didn't do so well.
Finerman has been out recommending
, but the stock has fallen 4% since her calls. Finerman continues to believe in it and likes the cheap valuation.
On September 13th Macke told investors that
would see no benefit from settling with their union. Since his call, the stock has shot up 15%. Macke replies that even if GM settles, you will still be left with a horrible auto company.
Monday September 17th Adami told investors that if the Fed cuts by 50 basis points the market will trade lower. After the Fed cut the market zoomed higher and Adami now admits his call was a bad one.
Pops & Drops
traded up 5%. Macke thinks rate cuts are great for companies like AT&T.
popped 8%. Finerman says don't ignore NYX and she is long this name. (
Take: Jim Cramer said recently, "NYSE? Get this, people are telling me the chart looks great." To read more on what Cramer said,
traded up 8% this week with oil touching record highs. Najarian points out that the service sector is on fire.
traded up 10% on a bullish earnings report. Macke agrees that it was a great quarter for Oracle.
traded up 6%. Finerman thinks EL is a quality company and loves it.
popped 5% after an analyst meeting Friday. Adami retorts that they can't compete with
Take: Bill Trent said recently, "There are plenty of ways to play this one, including Brocade" To read more on what Trent said,
exploded up 16%. Macke suggests that if you bought this stock before the big run, take half the position off the table.
fell 5% after reporting disappointing earnings. Adami says at these levels FedEx doesn't do it for him. (
Take: Jim Cramer said recently, "Moreover, I think that the shorts are going to regret taking derivative action -- meaning pin action -- off FedEx's call. I think that they shot first and won't even have time to ask questions before they are overrun on the short-side." To read more on what Cramer said,
dropped 5% after bearish analyst comments. Adami advocates owning this into earnings.
fell 14% after reporting a disappointing profit outlook. Macke suggests that everyone gets out of the pool..
The "Fast Money" team gives their final best ideas before signing off for the weekend.
- Macke reiterates his sell on General Motors (GM) - Get General Motors Company Report.
- Najarian recommends BJ Services (BJS) .
- Finerman continues to like NYSE Euronext (NYX) . (RealMoney Take: Steven Smith said recently, "Given that activity in NYX, there is now a bullish bias as stock is on the cusp of breaking a seven-month downtrend, but that option activity in October series saw a large purchase of the $80 calls, which traded over 13,000 contracts or nearly triple the prior open interest of 3,300 contracts." To read more on what Smith said, click here.)
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