Dylan Ratigan hosted CNBC's "Fast Money" Monday night. He kicked off the show with a discussion around Fannie Mae( FNM) and Freddie Mae( FRE), which saw their shares plunge after the U.S government took over the companies.
Ratigan asked the traders if they are any more confident to buy stocks today than on any other day this year. Pete Najarian said yes. He advised viewers to consider
Morgan Stanley
(MS) - Get Report
. He also disclosed that he added to his put position in
Lehman Brothers
( LEH).
Jeff Macke said he likes
Wal-Mart
(WMT) - Get Report
, which broke out technically today. Guy Adami mentioned that
Church & Dwight
(CHD) - Get Report
and
Johnson & Johnson
(JNJ) - Get Report
continue to work.
Ratigan switched the conversation to the housing market. Macke said that if he were long any homebuilding stocks right now, he would be taking profits. Adami pointed out that the 30-year mortgage rate went from 6.5% to 6% today. He said he likes
Home Depot
(HD) - Get Report
for a play on the housing recovery.
Finerman said that if you want to play in the housing sector, buy something like
MDC
(MDC) - Get Report
or
Centex
(CTX)
that isn't over-leveraged. Najarian explained that the homebuilding stocks have been moving higher because of the high short interest in the sector. Macke and Najarian both agreed that the homebuilders are trading vehicles only.
Ratigan brought up a report out of the
Financial Times
that said subprime king and hedge fund manager John Paulson told investors he's looking to get more involved with the financial sector. Finerman said she likes the idea, and she said she would take a look at
Fannie Mae
( FNM) preferred stock,
General Electric
(GE) - Get Report
and
Citigroup
(C) - Get Report
.
Adami mentioned that
U.S. Bancorp
(USB) - Get Report
is close to an all-time high. Najarian said the cream of the crop in the financial stocks includes
JPMorgan
(JPM) - Get Report
, U.S. Bancorp and
Wells Fargo
(WFC) - Get Report
.
Turning to Tech
Ratigan moved the talk to the technology sector. Adami pointed out that the chart of
Research In Motion
( RIMM) is broken. "If you're long RIMM, you should buy some puts and sell an upside call," Najarian added. Finerman says
(GOOG) - Get Report
is getting close to a value play when you look at the P/E level. Najarian pointed out that Google traded twice its average volume today, which could be a sign of a bottom for the stock.
FBR analyst Paul Miller joined the traders to discuss the financial sector. Miller says the bank stock rally is a step in the right direction, but he said he is worried about what will happen during the fourth quarter. "I think the financial rally has more room to go and will extend for a couple of more weeks," he added. However, Miller said he is worried that any bank with a large amount of Level 3 assets, like
Wachovia
(WB) - Get Report
, could be the subject of an audit in the fourth quarter.
Socialist Trade?
The traders discussed ways to trade the government's new move toward socializing companies. Adami explained that
Gap
(GPS) - Get Report
has figured out a way to get their gross margins up 4%, and its operating margins up 10%. He said that when we come out of the credit crisis, the retailers will do well. Finerman thinks the government intervention in Fannie Mae and Freddie Mac is bearish for the equity of
General Motors
(GM) - Get Report
and the airline stocks.
Opec and $100 Oil
Joe Terranova joined the crew to discuss the chances of OPEC allowing crude oil to trade down to $100 a barrel. He said that right now, OPEC is over-supplying the market. He said that if OPEC doesn't get what it wants, it may cut production at the December meeting. He said the refiners could be a trade here, but the market is so crazy, it's a tough call.
The bottom line from Terranova is that the
United States Natural Gas Fund
(UNG) - Get Report
and the
United States Oil Fund
(USO) - Get Report
isn't the way to trade crude oil right now.
Technical Talk
Oppenheimer chief market strategist Carter Worth joined the traders to discuss his call to sell the bounce in a note to clients today. Worth explained that the volume wasn't near record levels, and semiconductors didn't even participate. He said he was surprised the Dow wasn't up 1000 points off the Freddie Mac and Fannie Mae takeover news, and the fact it wasn't shows the market is weak. Worth said the only stocks working today were the same "loser stuff" and not names like Google and the chip stocks.
Apple Music
Piper Jaffrey tech analyst Gene Munster, joined the gang to discuss
Apple
(AAPL) - Get Report
ahead of the company's meeting set for Tuesday. Munster said it will be music-based announcement around the iPod Touch or iPod Nano. Munster said the meeting doesn't mean much because the iPod is the least significant of the company's three business segments.
He said he feels the meeting has more to do with Steve Jobs. "I am confident that Jobs will be at the meeting and looking healthy," Munster said.
Trader Radar
Shares of
Home Depot
(HD) - Get Report
were among the most actively traded stocks on the
NYSE
today.
Final Trade
Macke said buy Research In Motion at $100 and stop out at $95. Adami picked
Urban Outfitters
(URBN) - Get Report
. Finerman recommended
Flowserve
(FLS) - Get Report
. Najarian selected
Novo Nordisk
(NVO) - Get Report
.
This article was written by a staff member of TheStreet.com.
