'Fast Money Recap': Computer Trading

The trading panel expressed concerns that the market is driven more by computer trading than fundamentals.
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) -- The markets closed higher Thursday ahead of a big jobs report.


Dow Jones Industrial Average

rose 5.74, or 0.06%, to 10,255.28, and the

S&P 500

added 4.45, or 0.41%, to 1,102.83. The


jumped 21.96, or 0.96%, to 2,303.03.

Pete Najarian said on


's "Fast Money" TV show that the technology stocks drove the market today with little help from the financials and commodities. He also said there was heavy put action.

Tim Seymour said he didn't see a lot of volume or players in the market. Instead he saw a lot of machines involved in trading that raised the anxiety level of investors.

For a breakout of some stocks from a recent "Fast Money" TV show,check out Dan Fitzpatrick's "3 Stocks I Saw on TV."

3 Stocks I Saw onTV

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Joe Terranova, detecting negativity from the other panelists, said he didn't believe the market is headed for a precipitous fall. Rather he believes it's in the midst of a rotation over the next few months to quality names like those in technology and away from consumer discretionary names that did well in the first quarter.

Najarian cited three stocks that may indicate whether they market is going to make a move or not. They were

Goldman Sachs

(GS) - Get Report


Cliff Natural Resources

(CLF) - Get Report


Freeport McMoRan

(FCX) - Get Report


Brian Kelly said the market is in the midst of a correction this month after adjusting to new fundamentals in May.

Herb Greenberg, a senior stocks commentor for


, pointed out that market is being driven more by computer trading than fundamentals. For instance, he said bigger funds are surprisingly refraining from shorting lower quality stocks based on fundamentals.

The panelists briefly discussed some events coming up that could impact the market. In addition to the jobs report, there is the possibility that the SEC could implement a circuit breaker as early as Monday that would halt trading for five minutes if there has been a 10% move in the stock in the preceding five minutes.

Other panelists noted a G-20 meeting in Korea over the weekend and a report out of Hungary that it is in worst shape than Greece.

There was some more commentary about how to trade



, and other stocks in the troubled energy space. Najarian warned against buying BP for the dividend and said if investors do want to get into the stock, it would be on the bet of a rebound. Other panelists noted energy stocks with less exposure to the Gulf such as

Baker Hughes




(SLB) - Get Report



(APC) - Get Report


Lee shifted to copper which slumped today. Adami said much of it was due to fears that China may curb its demand for copper. Najarian, though, said he was getting mixed signals about China's appetite for copper, noting

Joy Global


had said that the demand for copper remains strong in China.

In the ear to wall segment, Gary Kaminsky downplayed reports of a departure of trading talent from


(C) - Get Report

. He said the chances of these traders finding jobs are much better these days.

He said most hedge funds are buying Citicorp not for the long term but on the the bet that it could reach a "sustainable" $5 and attract mutual funds and long-only managers who were underweight in the stock. It's an "opportunistic" move, he said.

In the airline sector, Pete noted heavy options activity in

US Airways



United Airlines


. He said there was more call buying than put buying.

Analyzing today's retail results, Deborah Wainswig, an analyst with Citi Investment Research, said the data was "bizarre" with strong sales of men's suits and women accessories. She interpreted that buying pattern as showing a concern for jobs and a desire not to spend a lot.

Her best bets were




Dollar General

(DG) - Get Report

. She also liked


(M) - Get Report

as a turnaround story.

In a segment that looked beyond the headlines, Paul Sankey, an analyst with Deutsche Bank, said he doubts BP would cut its dividend after the negative experience its managers endured when it cut the dividend in 1992.

He favored going long


(XOM) - Get Report

, which shorted the Gulf, and short


(CVX) - Get Report

because of its involvement in super deeper-water drilling.2. Commenting on Friday's jobs report. Charles Biderman, president and CEO of Trim Tabs Investment Research, expects just 75,000 to 125,000 jobs added to the private sector, negative job growth next month and an unexplicable decline in wage and salary growth.

Shifting to a report today showing robust chip growth, Rick Hill, CEO of



, said the company has been enjoying strong growth after coming from a low base last year. He said one of the drivers for the business has been the booming business in Asia, especially China, where consumers are spending for electronics and the country is building up its semiconductor industry.

In the final trades, Seymour was down on

Rio Tinto


. Adami liked


(AKAM) - Get Report

while Terranova liked

Estee Lauder

(EL) - Get Report

. Najarian said


(INTU) - Get Report

was a buy.

-- Written by David Tong in San Francisco

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