Stocks in the U.S. closed the week on a mixed note Friday as investors digested a number of earnings reports, weak consumer-sentiment data and record oil prices. The Dow added 42 points, and the Nasdaq fell 5.99 points.
"Fast Money" TV show, the traders discussed
weaker-than-expected sales numbers. Guy Adami said the quarter was fine and said guidance for next year was fantastic. He still believes the stock is screaming buy at current levels. Karen Finerman said she is happy to own the stock at current prices. Jeff Macke disclosed that he bought shares in the software giant on Friday.
Finerman looked at a few options that Microsoft should consider as the merger deadline for
approaches. She said Microsoft could drop the bid, bump it, nominate new directors or exchange the offer for cash and stock. Her advice was to exchange the offer. Macke said that if he were running Microsoft he would tell Yahoo! to get bent. He disclosed that he sold that last of his Yahoo! shares on Friday.
Crude oil prices spiked to almost $120 a barrel after news broke that a U.S. cargo ship fired at two Iranian speed boats. Addision Armstrong, a
on-air contributor and director of market research at Tradition Energy, joined the traders to discuss his take on oil. He said that the interesting thing is that the Iran confrontation was 24-hour-old news, and it still moved the oil market. He said oil looks strong, and he isn't convinced that the dollar's strength is here to stay.
Najarian questioned Armstrong about the strength on natural gas. He responded that natural gas looks incredibly strong, and he said the futures contracts will trade up to $11.70. He added that large speculators are net short by the highest amount in history.
Najarian recommended that investors look at the oil service sector. He added that there is market speculation of a deepwater discovery near Brazil, and this could be bullish for names like
. He also likes the
Oil Service ETF
which broke out this week and trades at 11 times forward earnings.
Gold and Dollar Talk
Gold prices broke a two-day losing streak, and the dollar rose sharply. Adami said he doesn't like the price action in gold, especially after Dennis Gartman recently went bearish on the yellow metal. He predicted the dollar will reverse big time in the second half of this year. If that happens, he said, the entire commodities complex will get crushed. Macke said the dollar is done going down, and nothing was more evident of that than oil and the dollar both trading in tandem to the upside.
Chart of the Day
The traders took a look at the chart of hot agriculture name
. Najarian explained that charts don't go straight up forever. He said he doesn't think the ag names are done going up and said almost all of them have reasonable valuations. Adami recommended that investors pick up this week's issue of
for a great piece on
All Hail the Rail
Adami said to watch
( BNI), which reports earnings before the bell on Tuesday. He advised investors to take some off the table around these levels. He mentioned that rail plays
continue to rip higher. Najarian said the rails are doing well because of the ag and coal play.
He told investors to keep an eye on
( JOYG) and
( BUCY), which are the equipment makers that help get coal out of the ground.
Charging for Profits
Adami said the
numbers bode well for
. He also said to look at
if you want to get back into financial stocks. Macke steered investors toward
Fed Up With Rate Cuts
MKM Partners' Chief Economist Mike Darda joined the traders to discuss the upcoming
rate policy meeting set for Wednesday. Darda said he believes it will be "one and done" for the Fed. He explained that the rate-cut cycle is essentially over. He also mentioned he doesn't think the Fed will do an emergency surprise cut. Finerman explained that Fed member dissention could be signal that the central bank is done. Bottom line, the traders all say the Fed is going to be done.
Lehman Brothers media analyst Anthony DiClemente joined the traders to discuss his take on the media stocks ahead of their earnings reports set for next week. DiClemente said
has earnings momentum, and he expects
to continue to outperform.
He explained that
has too much exposure to radio and TV stations, and those businesses have a lot of question marks. Disney is hitting on all cylinders, but the coming quarter will have tough comparisons, DiClemente said.
Playing Video Games
will be releasing the controversial video game
Grand Theft Auto IV
. Can investors make money off this? Macke said he doesn't believe that
( ERTS) really wants to buy Take-Two. Take-Two has bet the house on this game, said Macke. He said he believes the numbers out of the gate for the
are going to be enormous.
Quicker Than the Ticker
The traders looked at their recent good calls. Fineramn told investors to buy
Philip Morris International
. She was on the money, and MO went up 6% from her call. Adami recommended
. Shares of APA went up 12% since his call. Macke said buy
on a dip before earnings. The stock ripped 11% higher from his call. Najairan picked
. He nailed the call, and GS advanced 16%.
shares were among the most actively traded on the
New York Stock Exchange
The traders took a look at some of their bad calls. Najarian had recommended
, but record oil prices took the stock down. He said that if you're in this stock, get out. Finerman said to buy Microsoft going into earnings. The stock fell 6% since her call, but she is sticking with the name for a longer-term story.
Macke had advised investors to get into
. Since his call, the stock fell 13%. He said to stay out of the stock until Starbucks listens to him on how to fix the company. Adami had picked
because he said they have no subprime exposure. He was dead wrong, and the stock fell 11% from his call. He admitted he was wrong.
A Guest From the West
Neil Koehler the CEO of
joined the traders to discuss ethanol. Koehler said that right now we're in an energy crisis, and we have a dangerous dependence on foreign oil. Ethanol is lower than the cost of gasoline and provides significant economic benefits, he said.
Najarian asked Koehler about liquefied coal. He said we need a whole host of new energy ideas to draw from like liquefied coal. Koehler explained that the government is mandating that we move away from fossil fuels and toward alternative energy sources that are renewable. He said that right now, ethanol is the best choice until a better technology or alternative energy choice comes along.
Macke said to sell
. Najarian's son picked Disney.
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