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Fast Money HomeFast Money Rapid RecapAbout Fast MoneyFast Money BiosFast Money Web ExtraFast Money Disclaimer
Text Size
Aug.20
1:41 PM ET
Wednesday, 20 Aug 2008
Fast Money Now – Mid-Day Trades for Wednesday
Posted By: Lee Brodie

The Dow Jones Industrial Average [.DJIA  Loading...      ()   ] was little changed mid-day Wednesday as rising oil prices and nagging concerns about the credit crisis offset a strong profit outlook from Hewlett-Packard.

MARKET CAN'T SHAKE CREDIT FEARS

Shares of Fannie Mae [FNM  Loading...      ()   ] and Freddie Mac [FRE  Loading...      ()   ]. fell to the lowest levels in more than 17 years as concerns mounted that the U.S. housing finance companies may need a government bailout.

Fannie and Freddie are strictly trades, counsels Jon Najarian. In and out.

I think you should either bet on red or black. It’s about the same odds, exclaims an annoyed Jeff Macke.

Meanwhile Sanford C. Bernstein & Co analyst Brad Hintz cut his earnings estimates for Goldman Sachs [GS  Loading...      ()   ] and Morgan Stanley [MS  Loading...      ()   ].

“Weakening credit market conditions in the third quarter indicate that more write-downs and hedging failures will likely impact U.S. investment banks' performance for the period,” the analyst said Wednesday.

Hintz rates Lehman [LEH  Loading...      ()   ] and Goldman "market perform," and has an "outperform" rating on Morgan Stanley.

What’s troubling to me is that we don’t know whether the commercial mortgage backed securities are continuing to weaken, adds Joe Terranova. I think that’s why we’re seeing the downgrades. For a trade I’d get long Goldman and Morgan and short most anything else.

I don’t trust the current rally in Lehman, adds Guy Adami. I don’t think we’ve seen capitulation.

In the space I like JP Morgan [JPM  Loading...      ()   ] best, adds Jon Najarian.


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H-P LEADS TECH.

Hewlett-Packard [HPQ  Loading...      ()   ] offered a ray of hope in an otherwise bleak market; the stock is higher on a strong earnings report. 

This stock looks cheap on a valuation basis, says Guy Adami, but I didn’t think their quarter was that great.

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OIL GIVES UP GAIN

Oil prices [US@CL.1  Loading...      ()   ] reversed earlier gains following a government  report that showed U.S. crude oil inventories rose far more than expected last week while gasoline inventories dipped more than expected.

Despite the downward momentum in oil Goldman Sachs’s reiterated on Wednesday its year-end price forecast of $149 a barrel for U.S. crude oil, and said strong fundamentals were a more important factor than a strengthening dollar.

I agree with the fundamental theme behind that forecast, says Joe Terranova. I think the play is integrated oil.

----------------- (Scroll Down For More Trades) -----------------

What do you think? Answer the Charles Schwab Question of the Day.










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TOPPING THE TAPE: COMMODITY STOCKS

Spooked by financials it appears investors are putting money to work in commodity stocks. From steel to energy the commodities sector is among the biggest gainers mid-day.

Look at US Steel [X  Loading...      ()   ], says Guy Adami. I know the chart is broken but not the company. Otherwise, I think we’re in a sell the rally mode.

I’d stay away from commodities right now, counters Joe Terranova.


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CASINO STOCKS NEED A MARKER

Both Las Vegas Sands [LVS  Loading...      ()   ], and MGM [MGM  Loading...      ()   ] are trading lower mid-day after hitting heavy resistance on a technical level.

(LVS)
Loading...       (%)