No. 1 - What Recession?
Greenspan be damned, investors betting on this A-Ok economy.
Stocks climbed further out of their malaise today. And the sectors that pulled the market higher sent a message to economists doubting the strength of the global economy. Traders bid up tech, steel and transports; areas all linked to global growth. It’s also worth noting that traders put money to work last week during the nasty sell-off. Ahead of a crucial jobs report tomorrow, is the market telling the real story of the economy?
Eric Bolling says the trade is still with companies that are well insulated from gyrations in the market. Eric likes Loew’s (LTR) the hotel chain, because they own 51% of Diamond Off Shore Drilling, they own Lorrilard tobacco and C & A financial. They’re so diversified, they’re unaffected by all these dips and doodles.
Guy Adami says transports are an excellent predictor of the economy but he’s not ready to climb on this train. Prudential's overage on the “rail and trucks” was negative and Bear Stearns downgraded the rails on 2/26… also Guy says UBS downgraded CSX Corporation (CSX) and Kansas City Southern (KSU) earlier in the month. There’s a theme here. And remember Fedex (FDX) guided down. Don’t rush into the space.
Tim Strazzini says National Semi (NSM) is up 10% from yesterday’s close. Applied Materials (AMAT) and KLA-Tencor (KLAC) were upgrade today. Toshiba (TOSBF) was upgraded by Goldman Sachs . There’s a lot of news coming out. These stocks are talking positively about flat to 'down a couple percentages points' in year over year earnings. As a matter of a short trade in this space, (the chips, the micro-processors and the semi-cap equipment names) it’s about figuring out how far out in the year they’re discounting. AMAT and KLAC are the economic indicators. There is going to be a stronger economic rally. Continue to own chips.
Jeff Macke says he agrees but don‘t confuse the economy with what the stocks are doing.
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On MAR 8, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders. Strazzini Owns (EWG), (WMT), (YHOO). Bolling Owns (MPEL), (SZE), (VE), Gold, Silver, Soybeans, Is Short S&P Futures, Is Short Nasdaq Futures, Is Short Natural Gas, Is Short Corn. Macke Owns (JWN), Strazzini Owns (FLS), (SNDK)