There are beneficiaries to lower oil prices and that's evident by the recent strength in the consumer cyclical and industrial sectors, Josh Brown, CEO and co-founder of Ritholtz Wealth Management, said on CNBC's "Fast Money Halftime" TV show. Fuel prices are one of the largest costs for these sectors.
Airline stocks benefit from lower fuel costs too, said Pete Najarian, co-founder of optionmonster.com and trademonster.com. Also, investors can stay long rail stocks, since the companies' business is not affected by fluctuating oil prices.
Steve Grasso, director of institutional sales at Stuart Frankel, said that oil services stocks seem to be holding up relatively well, especially after reports surfaced regarding a potential acquisition of Baker Hughes (BHI) by Halliburton (HAL) - Get Halliburton Company (HAL) Report .
Stay with the activists, said Jon Najarian, co-founder of optionmonster.com and trademonster.com. Companies like Apache (APA) - Get Apache Corporation Report , Transocean (RIG) - Get Transocean Ltd. Report , and Anadarko Petroleum (APC) - Get Anadarko Petroleum Corporation Report were among those he suggested.
Many of the large banks have been getting out of the commodity business, according to Dan Dicker, president of MercBloc. This has taken away the "bid" that has been holding up many assets, such as oil. Without the banks to buy, prices have come down. He acknowledged that lower oil prices are good for gas prices, but reminded investors not to cheer for too much downside, considering how many jobs have been added in the energy sector in the past five years.
Low-end retail stocks are expected to benefit the most from lower oil prices, because the customers tend be impacted more significantly than customers shopping in high-end retail. Pete Najarian said a company like Wal-Mart (WMT) - Get Walmart Inc. Report should feel this positive impact. He also likes Nike (NKE) - Get NIKE, Inc. (NKE) Report on the long side.
Murphy added that Wal-Mart received a downgrade on Friday and he argued that now is not the time to sell the stock. The company is finally doing good and has lower oil prices at its back.
Jerry Storch, CEO of Storch Advisors, stated that "there's always winners and losers in retail." He likes Michael Kors (KORS) , Costco Wholesale (COST) - Get Costco Wholesale Corporation Report , Nordstrom (JWN) - Get Nordstrom, Inc. (JWN) Report , TJX Companies (TJX) - Get TJX Companies Inc Report and Ross Stores (ROST) - Get Ross Stores, Inc. Report . While lower gas prices are helping consumers, don't forget that other costs have been rising, such food, healthcare and cell phone plans, he added.
The conversation quickly turned to Twitter (TWTR) - Get Twitter, Inc. Report , which is higher by nearly 4% on Friday. The stock shot higher by 7% on Wednesday following the bullish commentary from its analyst day, only to give all of those gains back on Thursday.
It's been a volatile weak for shareholders, but the stock could run into year's end, Brown reasoned. Twitter's market cap is big enough and the stock is liquid enough that many fund managers could begin plowing into the name looking to boost their annual returns.
Jon Najarian pushed back, arguing that while Twitter's long-term guidance was strong, it may have been too strong. The company may very well end up disappointing investors and CEO Dick Costolo may have dug his own grave because of it.
Management delivered at the analyst day, said Bob Peck, Internet analyst SunTrust Robinson Humphrey. He has a buy rating and $58 price target on Twitter. The new applications and new products seem likely to generate additional user monetization.
For their final trades, Murphy is buying Ford (F) - Get Ford Motor Company Report and Pete Najarian is buying Akamai Technologies (AKAM) - Get Akamai Technologies, Inc. Report . Jon Najarian is buying RF Micro Devices (RFMD) and Brown is buying J.C. Penney (JCP) - Get J. C. Penney Company, Inc. Report with a stop-loss near $7.
-- Written by Bret Kenwell