'Fast Money' Recap: Oil's Impact
NEW YORK (
) -- The markets cooled off Friday as the price of oil faded.
The
Dow Jones Industrial Average
fell 22.07, or 0.23%, to 9605.41, and the
S&P 500
slipped 1.41, or 0.14%, to 1042.73. The
Nasdaq
was dropped 3.12, or 0.15% to 2018.90.
Joe Terranova said on
CNBC
's "Fast Money" TV show said aggressive selling in oil brought down the trading session today and marred what was a "great week." Oil fell to $69.29 a barrel, down $2.65 for the day.
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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Greg Troccoli said $75 appears to be a resistance level for oil. Pete Najarian said the market can hold up even if oil slips below $70. Terranova opined that the market will head down if oil drops to $60.
Najarian said he believes the industrials have provided badly needed leadership for the markets. "We don't know need energy to pull us higher," he said.
Melissa Lee, the moderator of the show, shifted the discussion to
General Electric
(GE) - Get Report
, which has been steadily moving higher toward the $15 level. Seymour said the company is starting to show signs of earnings normalization. Troccoli said GE has to be "part of your portfolio" because of its balance sheet and diversified businesses.
Lee noted that gold continued to move higher as it rose above $1,006 an ounce. Terranova said his next target for gold is $1,033. "There's not reason to get out of it," he said.
Troccoli, though, said investors should be buying puts if gold doesn't break above $1033. Terranova said the strong correlation between gold and the weak dollar will continue to play out in September, notoriously the worst month of the year for the dollar.
Najarian told viewers to check out the steel and copper names, especially
Freeport McMoRan
(FCX) - Get Report
which he said should continue to go higher. Seymour said coal, coke and iron ore names were also breaking out.
Lee shifted the discussion to
Morgan Stanley
(MS) - Get Report
, which announced a new CEO this week. Brad Hintz , an analyst for Sanford Bernstein, said James Gorman is the "right man" for the job because of his experience in retail brokerage, consulting and asset management.
Hintz believes Gorman can follow through on the integration of Morgan Stanley and Smith Barney. Hintz's best choice in the financials, though, was
Goldman Sachs
(GS) - Get Report
, which Najarian sees hitting $200.
Lee turned to chartologist Troccoli for an assessment of the recent rally. Looking at the daily S&P charts, he said he sees "tight price action" and a "slow grind upward." He said there could be a bull trap in the next two days, adding the next level for the S&P is 1125.
Lee asked him to comment on
Apple
(AAPL) - Get Report
He said he sees Apple heading to $185 to $190 if it can get above $167. He said investors should always be careful of expensive stocks like Apple and Goldman Sachs. Najarian said it makes good sense to buys, which are relatively cheap now, in these stocks.
Najarian briefly noted heavy call activity in
Energy Conversion Devices
(ENER)
, which was up nearly 8% today. Najarian said he didn't know why it was up, although he said it might have to do with the "monster" short interest and the company's CEO pulling out unexpectedly from a scheduled conference.
Is biotech ready for a breakout? Mark Schoenebaum, a Deutsche Bank analyst, said
Genzyme
(GENZ)
could be a sleeper.
He said Genzyme has been dogged by production problems of two drugs that treat rare diseases. He said it also has had a run-in with the Food and Drug Administration. If Genzyme can get over to these problems, it's the cheapest biotech stock, he said.
Schoenebaum said his best biotech trade is
Gilead Sciences
(GILD) - Get Report
which he says is a "phenomenally" managed company.
Lee shifted the discussion to Obama's Monday address on Wall Street reforms. Troccoli said the best way to improve the regulatory process is to recruit people from the Street to regulate the businesses they know.
In a weeklong sessionon lessons from the
Lehmans
debacle a year ago, Terranova said he learned the value of taking defensive measures. He told viewers of the value today of putting in stop-loss orders and puts.
There weren't any final trades.
-- Written by David Tong in San Francisco
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