'Fast Money' Recap: Safe-Haven Trades
NEW YORK (
) -- The selloff continued Thursday with gold posting its biggest gain in eight weeks.
The
Dow Jones Industrial Average
dropped 58.88, or 0.57%, to 10,319.95, while the
S&P 500
fell 5.86, or 0.54%, to 1,083.61. The
Nasdaq
lost 18.36, or 0.83%, to 2,190.27.
Joe Terranova said on
CNBC
's "Fast Money" TV show, that said it's imperative to focus on a defensive strategy that includes gold, fixed income, ultilities and health care.
Guy Adami said
Caterpillar
(CAT) - Get Caterpillar Inc. Report
TheStreet Recommends
becomes an interesting play on a pullback when it hits $66. He said that would represent a 50% correction off its May 6 high.
Karen Finerman said she was looking at some health care names including
Becton Dickinson
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, while Jon Najarian said he was selling his puts in
Cisco
(CSCO) - Get Cisco Systems Inc. Report
.
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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Adami was opposed to being in gold. Having traded gold for 14 years during a down market, he said he learned how fast gold prices can head down. Terranova said $1,225 an ounce will the critical point for gold if it is to break out and move toward $1,300.
Melissa Lee, the moderator of the show, shifted the discussion to a shareholder suit against the board of
Hewlett-Packard
for failing to inform them of the press release on the resignation of its former CEO Mark Hurd.
Finerman defended the board's action, saying it it performed its fiduciary duty when it investigated the claims. Gary Kaminsky said the larger issue is the loss of the Hurd premium from the board's action.
Adami suggested that
NetApp
(NTAP) - Get NetApp Inc. Report
, which was down 9% today, was one tech name to look at.
Terranova said the tell from the earnings of
IBM
(IBM) - Get International Business Machines Corporation Report
and
Cisco
(CSCO) - Get Cisco Systems Inc. Report
could be a signal that the corporate spending cycle is coming to an end. Patty Edwards said she picked up some Cisco shares at these levels, saying it's "definitely worth picking up."
For his hedge fund pick of the week, Anthony Scaramucci chose
Lorillard
(LO)
. He said the defensive tobacco play is fundamentally attractive, trading at 18 times earnings, sporting an earnings cash yield of 8.3% and providing a 5.3% dividend yield. "It's the second leading brand in cigarettes in the U.S."
Finerman and Edwards liked the pick but said they would favor the international tobacco plays like
Philip Morris
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Lee noted that
Nordstrom
(JWN) - Get Nordstrom Inc. Report
was down 4.83%. Edwards said the retailer's inventories were higher than they should be, in yet another sign of the consumer slowdown.
In the "tomorrow's headlines" segment, Stephen Weiss, a Short Hills Capital partner, advanced the argument that quality dividend yields may be a better play than corporate bonds, citing
Johnson & Johnson
(JNJ) - Get Johnson & Johnson Report
as an example.
David Riedel, president of Riedel Research Group, said he would stick with products that people will buy in Japan. He said companies that sell tobacco and alcohol along with the utilities have been outperforming in Japan's bear market.
Lee noted that John Paulson & Co. had a rough June, with its Advantage Plus Fund down 7%. Finerman said Paulson might take smaller positions in
Bank of America
(BAC) - Get Bank of America Corporation Report
. Adami said it might be a good time to get into BAC when it is trading at tangible book.
Toni Saccognahi, a Sanford Bernstein analyst, criticized
Apple
(AAPL) - Get Apple Inc. Report
for sitting on $43 billion in cash and getting a paltry 0.76% return. He said the company should consider paying a dividend or a buyback, two suggestions Finerman roundly endorsed.
Despite the battering in the tech sector, Tom Gillis, an analyst with BGC Partners, said he still likes tech names such as
Apple
(AAPL) - Get Apple Inc. Report
and a high yield name like
Microsoft
(MSFT) - Get Microsoft Corporation Report
.
Lee shifted to Microcity whose stock has fallen 17% since its IPO in June. Lee asked Ryan Wurch, CEO of
Motricity
(MOTR)
, a mobile Internet service provider, if it was vulnerable because 70% of its revenues come from two customers.
Wurch called
AT&T
and
Verizon
(VZ) - Get Verizon Communications Inc. Report
"great" customers and said his company was expanded aggressively overseas.
Asked about
16% stake in the company, he called Icahn a "great friend" of the company who is interested in seeing it grow.
In the final trades, Terranova liked
SPDR S&P Biotech
(XBI) - Get SPDR S&P BIOTECH ETF Report
while Terranova liked NetApp. Finerman liked
Barnes & Noble
(BKS) - Get Barnes & Noble, Inc. Report
. Najarian liked
Autodesk
(ADSK) - Get Autodesk Inc. Report
.
-- Written by David Tong in San Francisco
To watch replays of Cramer's video segments, visit the Mad Money page onCNBC
.
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