The headline: Financials Lead Market Rally on Merrill Lynch’s Dividend Reassurances
Karen Finerman didn’t realize reassuring the dividend constituted stock-moving news, but with the financials in the shape they’ve been it turns out it’s enough to send a stock higher. There’s so much money waiting to pile into these stocks that any excuse to do so will yield gains, she said.
This also shows that investors are finally willing to rotate back into financial stocks, Guy Adami said. Sure, there’s more headline risk but opportunities still exist.
What was once bad news is now good news. Even the non-event of Merrill reassuring its dividend essentially reassures investors that we’re coming up on the end of this crisis, according to Pete Najarian.
APPLE BUYERS RUSH IN
The headline: Apple Shares Fight Higher Despite Disappointing Q3 Guidance
Guy Adami thinks Apple is setting up to run toward $200. Jeff Macke agreed that the price action is bullish and the growth is still there.
Pete Najarian pointed to the company’s revenues to make a case for the stock still being cheap, even though it is around $170.
GREENBACK COMEBACK KNOCKS COMMODITIES
The headline: Dollar Gains Most Against Euro Since December; Commodities Post Sharp Losses as Gold Tumbles, Crude Oil Slides
The dollar has bottomed, as far as Guy Adami is concerned. As commodity stocks decline here, he would be picking up the best names in the group – namely U.S. Steel and Freeport-McMoRan .
As for the ag complex, Jeff Macke called it a “ridiculously crowded trade.” People are taking profits in the ag names and moving to the next party even though the conventional wisdom is that this bull market will be around for a while.
FORD SURGES THE MOST SINCE 1980
The headline: Ford Posts Unexpected Profit on Strong European Sales, Narrow U.S. Loss, Shares Rise 12%
Tim Seymour, joining the segment, said he views Ford as an emerging markets play more than anything else. Along with GM , Ford is spending money across the world as well as turning its business around at home. The company is showing that it’s serious by divesting foreign brands like Land Rover and Jaguar (which it sold to Tata Motors earlier this year). GM, on the other hand, still has foreign brands that hurt its bottom line, Seymour said. He called Ford the “leaner, meaner” auto company that’s a buy on its overseas growth.
Click here for a recap of Seymour’s latest Emerging Money trade in China.
AFTER HOURS ACTION: DECKERS
The headline: UGG Parent Company Deckers Surges 10% on Better-Than-Expected Earnings
Don’t be fooled here, Jeff Macke said. The bar is set so low for these sort of specialty retail plays that all this earnings beat means is that the company isn’t going bankrupt. The stock is going up mostly because the it is such a popular short, he said. Approach Deckers tepidly and remember that at this point the earnings game is all about expectations.