The markets ended up Tuesday as money continued to flow in from the sidelines.
Industrial Average was up 19.43, or 0.22%, to 8,740.87, while the
rose 1.87, or 0.20%, to 944.74. The
rose 8.12, or 0.44%, to 1,836.80.
Joe Terranova said on
's "Fast Money" TV show that funds are flowing into the market. He said underperformers did well today, especially biotech names such as
, which was up 3.94%, and
, up 2.58%.
However, he said to be cautious because the some of the early leaders of this rally have given up ground such as the financials, energy and basic materials.
He said just how quickly the financials can get back will depend on their ability to return to "normalized" earnings.
Matthew Albrecht, a S&P analyst, said small and regional banks definitely will find it more difficult to raise capital than the larger banks because they are more focused on the consumer, a situation he finds troublesome.
By contrast, he said, the larger banks are in a much more stable situation because they have eliminated preferred dividends, developed a common equity share base and taken steps to eliminate pay constraints.
Still, he sounded a cautionary note, when he said the financials are fully priced for this kind of environment.
Melissa Lee, the moderator of the show, noted that oil, which has been on a tear, declined today, sparking bearish sentiments. Guy Adami said one way to be bearish on crude is to be long on an airline like
. He agreed with Karen Finerman that another option would be to short crude.
Lee shifted the discussion to consumer stocks, which have been on quite a run to the extent they may be overvalued. Adami believes
is on its way down to $150.
Brian Kelly, president of Kanundrum Research, characterized the current rally is a "rally in a bear market." He said he's still buyer of retail stocks but on pullbacks.
He said another way to play this market is to be highly leveraged on the U.S. economy in stocks like timber companies such as
Plumb Creek Timber
He also said he would wait for pullbacks to buy
Research In Motion
Lee asked Tim Seymour to comment on the pounding of the U.S. currency today. He said the beating is connected to reflation and printing of dollars. He said the beneficiaries of a weaker dollar are commodity-based currencies and those with better balance sheets such as the Australian, Canadian, South African and Brazilian currencies.
Smartphones are grabbing the headlines in the wireless world, with the Pre from
, the Blackberry from Research In Motion and iPhone from
taking center stage in the pricey end of the smartphone market.
Jim Suva, a Citigroup director, said he expects a sellout of the Pre at Saturday's prelaunch of the highly anticipated smartphone. Still, his top pick in this group is Research In Motion.
He sees Palm, RIMM and Apple all being successful in this space. He also likes
as he sees an increase in glass production from an uptick in sales of notebooks and laptops in the fall.
Shifting to video games and the E3 video game conference in Los Angeles, J.P. Mark, president of Farmhouse Equity Research, was enthusiastic about the offerings on the floor. He said companies like
are making the gaming experience more compelling with its upgrade of the Wii console.
Not to be out done,
has generated a lot of buzz with its new 3-D motion-capture camera for its Xbox 360 game console, but Mark remains skeptical of the offering because he doesn't believe it can move the needle. "It's a small part of its overall mix," he said.
Paul Jacobs, CEO of
said his company has been lifted by the demand for high-end smartphones such as the iPhone and Pre, which uses its chip. He also said the company is faring well in China, which has launched a third-generation network using its technology.
In the final trades, Seymour was long
. Adami liked Jetblue and Finerman was long
. Terranova suggested a pairs trade: long biotech through
"'Fast Money'Portfolios of the Week" on Stockpickr every Thursday.