Oil wasn’t the only commodity to surge Tuesday. Wheat jumped 8%, gold finished higher and U.S. Steel popped as well.
Agriculture play Potash (POT) should be bought on any pullback as far as Guy Adami is concerned. His oil plays are Baker Hughers (BHI) and Schlumberger (SLB), both of which are cheap although BHI looks better fitted for a turnaround, he said.
The best thing to do is just buy the oil ETF and the gold ETF , according to Jeff Macke. Don’t bother with the individual stocks here.
Pete Najarian disagreed. The individual stocks get a better return off high commodity prices than the funds, he said. Buy XTO Energy (XTO).
On a similar note, Karen Finerman said she trimmed her position on water pump and valve maker Flowserve (FLS) ahead of its earnings Wednesday. The expectations are too high for the near term, she said, although the stock is still a value play on a long-term basis.
CELLAR DWELLERS NO MORE?
The headline: Homebuilders Rally Even as Home Prices Plummet, Foreclosures Soar
The S&P Homebuilders Index (XHB) is up over 10% in the last three days, leading Guy Adami to think a bottom could be forming in the beleaguered housing market. But don’t buy homebuilders indiscriminately, he warned. He thinks Home Depot on a pullback is now a worthy buy.
SEARCH AND DESTROY
The headline: Google (GOOG) Falls 5% After comScore Report Shows Decline in Search-Ad Clicks
There needs to be institutional money flowing into GOOG before it can rebound, according to Pete Najarian. Guy Adami thinks that – believe it or not – with 18 times forward earnings, Google has actually become a value stock.
The headline:Financials ETF Mounts Solid Comeback After Monday’s Slide
There was aggressive call buying in the XLF on Monday, Pete Najarian noted.
Fannie Mae (FNM) and Freddie Mac (FRE) are looking toward a bottom, Karen Finerman said. The negative sentiment in those stocks is finally diminishing. While they aren’t necessarily buys to Karen, she would no longer short them either.
Pete Najarian likes to play the financials with individual brokers like Knight , Schwab and TD Ameritrade .
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Trader disclosure: On Feb.26, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Najarian Owns (BIIB), (NOK), (C), (CSCO), (MCD), (MS), (MSFT), (XLF), (XTO) Calls, (YHOO) and (YHOO) Calls; Macke Owns (INTC), (KSS), (MSFT), (ODP), (TSO), (WMT), (DIS), (YHOO); Finerman’s Firm Is Short (IYR), (IJR), (IWM), (MDY), (SPY), Finerman’s Firm Owns (DVA),(AAPL), Finerman’s Firm and Finerman Own (FLS), (HD), Finerman’s Firm Is Short (LEH) and Owns (LEH) Puts
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