'Fast Money' Recap: A Down Day

NEW YORK (TheStreet) -- The Nasdaq led U.S. equities lower on Friday, closing down by nearly 1%. 

On CNBC's "Fast Money" TV show, Brian Kelly, founder of Brian Kelly Capital, said investors are rotating out of high-growth stocks and into stocks like Microsoft (MSFT), Cisco Systems (CSCO) and U.S. Steel (X).

Pete Najarian, co-founder of optionmonster.com and trademonster.com, said many financial stocks hit 52-week highs on Friday -- including Bank of America (BAC), Wells Fargo (WFC) and JPMorgan Chase (JPM) -- before pulling back and ending the session lower. He attributed the selloff to profit taking and remained bullish. He bought Goldman Sachs (GS).

Steve Grasso, director of institutional sales at Stuart Frankel, said a lot of the selloffs on Friday were exacerbated. He was also a buyer of financial stocks on this pullback. 

Guy Adami, managing director of stockmonster.com, pointed out the weakness in the biotech sector, with the iShares Nasdaq Biotechnology ETF (IBB) selling off 4.75%. Specifically, he suggested that investors wait for Celgene (CELG) to consolidate before stepping in to buy. 

Biogen Idec (BIIB) was among the biotech stocks that got hit on Friday, falling over 8%. George Scangos, CEO of Biogen, said the company's hemophilia A and hemophilia B drugs should do very well and are currently available in Germany and Norway. He added the drugs will spread throughout the rest of Europe when the negotiated price is finalized with the other countries. He agreed with estimates that the drugs could grow into a $7 billion market for the company. 

Adami said Biogen has a strong pipeline of drugs and is not expensive, trading at 22 times forward earnings. However, like Celgene, he suggested investors let the stock settle down for several trading sessions before buying. 

Kelly said he preferred to play biotech stocks through an exchange-traded fund because of its diversity and his lack of knowledge in the specific companies. 

Najarian disagreed with the biotech ETF approach, saying investors should deeply research specific companies to find the good ones. He agreed with Adami that Biogen has a strong pipeline and a low valuation. 

Kelly said Twitter (TWTR) and FireEye (FEYE) held key support levels on Friday. 

Michael Pachter, an analyst at Wedbush Securities, was a guest on the show discussing the rising input costs for Netflix (NFLX). Netflix has already negotiated a peering deal with Comcast (CMCSA), he said, and Verizon Communications (VZ) is likely to charge even more. Content costs are also likely to rise. Netflix has "no leverage" he said, and will likely be forced to raise subscription prices, which will force some customers to drop the service. 

Najarian said the rising costs from cable companies is bearish for Netflix because it is likely to negatively affect subscription numbers -- one of the key metrics investors watch for each quarter.

Grasso said Tesla Motors (TSLA) needs to hold $225 for several trading sessions before investors can buy the stock. Kelly was watching the same price level. 

Najarian was a buyer of Tiffany & Co. (TIF). He reasoned that Friday's selloff was "unjustified." 

Grasso was a buyer of Carnival (CCL) because the stock has historically performed well in the month of April, up roughly 2% to 3% in the month for each of the past four years. 

For their final trades, Grasso was a buyer of Wynn Resorts (WYNN) and Najarian was buying Coca-Cola (KO), due to bullish call buying activity in the April 4 weekly expiration options. Kelly was buying natural gas and Adami said to buy Monsanto (MON). 

-- Written by Bret Kenwell in Petoskey, Mich. 


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Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter.

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