NEW YORK (TheStreet) -- Wednesday's stock market rally wasn't much of a surprise because of the Federal Reserve's comments, but Thursday's 2.4% rally in the S&P 500 has "no explanation," Karen Finerman, president of Metropolitan Capital Advisors, said on CNBC's "Fast Money" TV show.
Nothing has really changed, agreed Brian Kelly, founder of Brian Kelly Capital. Oil hasn't recovered and high-yield bonds didn't trade that well, despite ending the day higher by 0.7%. He doesn't "trust" the stock rally and bought put options on the HYG.
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The stock market can still enjoy a "Santa Claus rally," according to Steve Grasso, director of institutional sales at Stuart Frankel. However, it will be very hard for stocks to trade higher in the longer term, if crude prices don't rally as well.
The huge stock rally over the past two days isn't that surprising because everyone seemingly thought the market was headed lower, said Tim Seymour, managing partner of Triogem Asset Management. The U.S. dollar is headed higher and will put pressure on emerging markets and commodities.
There's been a "huge" divergence between the S&P 500 and the energy sector, with the S&P climbing 5% and energy falling 20% in the past six months. According to Paul Hickey, co-founder of Bespoke Investment Group, that doesn't spell doom for the market.
In fact, the stock market generally has a flat to slightly higher return when this type of divergence occurs, which has happened 16 times in the past 50 years among all 10 S&P 500 sectors, Hickey said. The underperforming sector, on average, returns a positive return 60% of the time over the next three, six and 12 months. Longer-term investors will likely be rewarded for buying energy stocks.
Finerman added that she is long Seadrill (SDRL) and recently initiated a small long position in the Market Vectors Oil Services ETF (OIH) . Kelly said investors could consider a long position in Exxon Mobil (XOM) if they believe oil will rally.
Grasso, who is long Southern Company (SO) , finds it interesting that utilities continue to perform so well despite it being a defense sector. Utilities are up 24% on the year.