NEW YORK (
) -- Shares of
were up more than 4% after it reported blowout earnings in after-hours and raised hopes that it might get Wednesday's trading session off to a good start.
For the day the
Dow Jones Industrial Average
rose 13.45, or 0.12%, to 11,019.42, while the
gained 0.82, or 0.07%, to 1,197.30. The
added 8.12, or 0.33%, to 2,465.99.
Pete Najarian said on
's "Fast Money" TV show that he sensed Intel's strong earnings report and guidance as well as its new server chip bode well for the $3.4 trillion in IT spending.
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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Guy Adami said the blowout quarter was hauntingly similar to last quarter's report, which bumped up the stock before a pullback. He said this trend has occurred into the past four quarters. "We're setting up for a similar move."
Melissa Lee, the moderator of the show, said it was a classic trading pattern in which investors "buy the rumor and sell on the news."
Tim Seymour said he was optimistic about the market because the "world is better" and "we are going to see that in the financials and that will spur this entire quarter of earnings."
said the perception that this is going to be a good earnings season has already been factored into the market. As a result, she said investors might see somewhat the same pattern that developed last quarter, when there was "great numbers but bad follow-through."
Adami said his comments weren't an indictment of Intel as much as it was a call based upon the experience of the past quarters, when the stock pulled back after responding favorably on huge volume to blowout numbers.
Gary Kaminsky reminded the panel that this earnings season is a lot different from January when there was a good reason for money managers to lighten up. He said managers now are afraid of being underinvested, adding he felt confident that "positive earnings action will dictate positive stock action" this time around.
As for derivative plays, Najarian said to take a look at
, which raised its guidance recently, as well as
. Adami mentioned
as another play.
Jim Goldman, who was listening on Intel's conference call, said he was impressed with 64% gross margin the company is reporting for the second quarter and all of this year. He also said Intel plans to hire 1,000 to 2,000 employees.
Intel's CFO Stacy Smith said the chip company enjoyed record revenue in the first quarter and was seeing the fruits of its investments during the downturn.
Another stock with a blowout quarter was
. Najarian said everything looked good in the earnings report except for coal volumes. He said the report speaks well for the global economic recovery. Finerman said it was good to heard that more hiring is going on and that the economy is getting better. She said this "mosaic" of data is providing a level of confidence to investors to be in equities.
With his "ear to the wall," Kaminsky said investors should be leery of three "red flags" from companies during earnings. He said they should be wary of companies that are "cautiously optimistic" in conference calls. He said to watch out for companies with vague dividend plans and those that say they are concerned about "higher rates."
Lee noted that
P/E rato had reached a staggering 100, while
was 28. Seymour said Baidu's valuation looked scary and said there were better alternative investments in China like
and the online gamers.
, which reports earnings Wednesday, Adami expects the company will report fine earnings but wondered how the stock will react.
Finerman said the biggest driver for JPM will be its provisions and what's happening in consumer credit.
Donald Fandetti, a Citi analyst, said
would be a good derivative play. Fandetti also liked
, adding investors want to be on the high end in this space. He said regulatory issues will put pressure on the low-end players.
In the 30-second pitch, Najarian focused on
, which he liked for its strong sales growth, diversification, growth plans in China and attractive dividend.
Shifting to the airline sector where
was up close to 9% on higher March traffic, Kaminsky said JetBlue and other discount carriers will be the beneficiary of any reduction in capacity from the merger of legacy carriers like the rumored tieup between
( UAUA) and
He said JetBlue will cash in on the momentum toward higher revenues and higher fees from such mergers.
Lee brought in Ben Thompson, of Samson Capital, who discussed the tax savings from investing in municipal bonds and other tax-exempt investments. He said the challenge will be separate the strong municipalities and states from the weak ones.
In the final trades, Kaminsky liked
. Seymour liked
. Adami liked
Medco Health Solutions
. Finerman liked
and Najarian liked
-- Written by David Tong in San Francisco
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