'Fast Money' Recap: Market Whips Higher

The trading panel and guests, including Doug Kass, discuss today's whipsaw market action and areas investors should buy now.
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NEW YORK (TheStreet) -- Stocks bounced back on Friday after taking a bashing all week long. Was it a roar that will continue on Monday or just short covering going into the weekend? Was this week a correction, or the beginning of a new bear market? Crude oil ended the week at $70, and the Nasdaq ended the week with a big 5% drop. The S&P ended its weekly loss at 4.2%.

Fast Money's

Joe Terranova said the most important point from Friday was that the markets broke through the flash-crash low and trader have to take advantage of that as a trading point of reference.

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 Najarian and the rest of the

Fast Money

gang agreed, but weren't so sure it amounted to more than a short squeeze. Steve Grasso said that in the final hour of trading the bears lost out, not willing to hold shorts after all the money they made this week, but it was a short squeeze.

Joe Terranova likes

American Express

(AXP) - Get Report

, saying it finally bottomed, and

Best Buy

(BBY) - Get Report

. Terranova said there are names exposed to the U.S. consumer market that investors should want to own. In semiconductors, Terranova likes

EMC

(EMC)

or

Teradyne

(TER) - Get Report

.

The

Fast Money

gang all said with the market being a traders' market now, exchange-traded funds in particular make sense for investors as intraday plays. Terranova is buying the Market Vector Russia ETF as a way to not only play forgotten market stories, but the oil market.

Oversold sector of the day? Energy is down 15% since April 23 and is the most sold off sector since late April. The

Fast Money

gang said the big energy names are stocks to play right now.

BP

(BP) - Get Report

, driven down by the oil spill, is one of the best names to play, and it is generally a bullish time for commodities, after a recent plunge in prices. Materials are the second-worst sector performer in the last month.

Steve Cortez of Veracruz said for the first time in weeks he is bearish on Treasuries and was selling in droves, with the Treasury mark going from strong to low as equities rebounded late on Friday. It's a near-term trader-oriented move, though, and not a long-term call related to macroeconomic trends.

Doug Kass joined

Fast Money

to say it's time to buy again. China will have a soft landing, Germany showed it had guts in approving a big bailout package from the euro region, the financial reform bill passed by the U.S. Senate does not include its most onerous provisions, and therefore, investors need to be buying.

Kass downplayed the attacks from the

Fast Money

gang that unemployment and consumer trends in the U.S. still don't support a no-holds barred bull buying spree in U.S. stocks. A particular bear to bull story from Kass was with the mortgage insurers, who have been beaten down for 12 months to 18 months.

Financial Reform

Financial reform was one of the biggest stories of Friday, after the U.S. Senate passed the financial reform bill on Thursday night, and it was a top of the tape issue in the markets. The

Fast Money

gang noted that many market watchers don't think the dreaded derivatives portion of the reform package will make it into the combined bill, and traders were buying the financials on Friday.

Steve Cortes began adding

Goldman Sachs

(GS) - Get Report

on Thursday and continued adding to that position on Friday as the financials rallied. Cortes noted that as of Wednesday, Goldman Sachs was approaching the point of trading at book value and the "real tell" in terms of Goldman bottoming out was on Wednesday, when the S&P was down again but Goldman and Morgan Stanley were both up. Cortes said he is very bullish on the brokers. Terranova agreed with that assessment, saying that Goldman Sachs was at its bottom, and that he is kicking himself for not starting to buy on Friday.

Even amid a strong finish to the week, Friday was a day of extreme trading and extreme volatility remains in the market. Michael Block, chief equity strategist for Phoenix Partners Group, said it's time for investors to be playing offense amid the volatility, and the way to play the market right now is with companies that derive revenues wholly from U.S. business.

Health care is a "too defensive" version of that theme for Block, but U.S. retailers that derive a majority of revenue from the U.S. are strong buys now.

There are five retailers with 100% of their revenue from the U.S. in the last quarter, including

Macy's

(M) - Get Report

,

Finish Line

(FINL)

,

Nordstrom

(JWN) - Get Report

and

Autozone

(AZN) - Get Report

, among them. The U.S. retail names have already rallied this year, but Block still likes them to go higher, with more purchasing power than expected for the U.S. consumer, and continuing unrest in European economies.

Final Trades

The

Fast Money

team ended a furious week of trading with some final trade recommendations reflecting big themes of the week.

Terranova said his Final Trade was the

Market Vector Russia ETF

(RSX) - Get Report

, which he and Steve Cortes both like as a trade in the current environment.

Steve Grasso said that his Final Trade was

DR Pepper Snapple Group

(DPS)

, a stock that had been highlighted earlier in the week as one of the U.S. revenue plays, as opposed to a beverage company like

Coca-Cola

(KO) - Get Report

with a big reliance on international sales.

Joe Najarian ended the week with a Final Trade call on buying shares of

BP

(BP) - Get Report

. BP still may not be able to stop the oil from leaking into the Gulf of Mexico, but Najarian says that the bleeding in BP's share price, coupled with the selloff in the energy sector, has made it time to buy beaten up BP shares again.

-- Written by Eric Rosenbaum in New York

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.

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