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Fast Money HomeFast Money Rapid RecapAbout Fast MoneyFast Money BiosFast Money Web ExtraFast Money Disclaimer
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Jun.13
5:47 PM ET
Friday, 13 Jun 2008
Stocks Rally On Oil Drop
Posted By:Lee Brodie

STOCKS RALLY ON OIL DROP

The Dow [.DJIA  Loading...      ()   ] closed higher after retreating oil prices [US@CL.1  Loading...      ()   ] and a tame reading of core U.S. consumer prices eased inflation fears.

Investors snapped up a broad range of stocks, including beaten-down financial shares, on the view corporate profits and a flagging economy will gain from the benign inflation data, which should allow the Fed to keep rates steady.

I wouldn’t read too much into the day’s trading, says Jeff Macke. It seems like a bit of a relief rally to me.

That’s how I see it too, adds Karen Finerman.

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WALL STREET CLEANS HOUSE THIS WEEK

Lehman Brothers [LEH  Loading...      ()   ] CEO Richard Fuld is actively listening to offers for the beleaguered investment bank, including a possible bid by private-equity firm Blackstone for a 20% to 30% stake, CNBC has learned.

Word of a possible acquisition or major investment in Lehman comes as the fourth largest US investment bank struggles to combat rampant speculation about the company's future.

Earlier in the week, Lehman pushed out its chief financial officer, Erin Callan, and chief operating officer, Joseph Gregory, amid a persistent clamor over the company's weak performance.

If you want to get aggressive I think it’s okay to own Lehman, but make sure to put a trailing stop on the trade, counsels Guy Adami.

Lehman laid the ground work for a horrific quarter, adds Karen Finerman. I think it’s all in the stock, already.

If you’re looking to play financials, also look at US Bancorp [USB  Loading...      ()   ], adds Adami.

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OPTIONS ACTION: YOUR BANK IS IN TROUBLE

Pete Najarian is seeing unusual bearish options action in regional banks such as Fifth Third [FITB  Loading...      ()   ].

I see a lot of put buying in regional banks, reveals Pete Najarian. I don’t think the trouble is over in this space. Keep you eye on FITB and KeyCorp [KEY  Loading...      ()   ].

When Goldman Sachs [GS  Loading...      ()   ] sneezes the regional banks catch cold, exclaims Jeff Macke. They’re exposed to construction, agriculture and every other bad thing that’s going.

Also watch Bank of America [BAC  Loading...      ()   ], adds Najarian. There was enough action in the options to suggest that someone is looking for something bad to happen in this stock.

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MICROSOFT, GOOGLE LEAD TECH HIGHER... YAHOO PLUNGES

Microsoft's [MSFT  Loading...      ()   ]plan to establish a strong footing in online advertising suffered a big blow on Thursday as merger talks with Yahoo formally failed and Yahoo [YHOO  Loading...      ()   ] said it would let Google [GOOG  Loading...      ()   ] sell search ads on its site.

According to Fast Money’s exclusive interview Jeffrey Lindsay, Senior Analyst at Sanford C. Bernstein, the deal could mean Google and Yahoo! will effectively control a lions share of the lucrative internet ad business leaving Microsoft out in the cold.

From a business perspective I think Google has had a great few weeks, observes Jeff Macke. They're emerging as the winner in the whole drama.

I like Google too, adds Guy Adami, but put a stop on at $540.

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IPHONE DISAPPOINTMENT

Apple [AAPL  Loading...      ()   ] stock fell 7% this week despite the premiere of the new 3G iPhone on Monday. There were whispers this week that Steve Jobs might be facing another health issue, although that’s strictly market rumor.

I think the stock slide has a lot more to do with the health issue than the iPhone, says Pete Najarian. And I bought puts to protect myself.

The company has come out and said he’s not sick, adds Karen Finerman. If he really is, it would leave them open to possible legal recourse. Take that for what you will.

I’m a buyer at current levels, concludes Guy Adami.

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TOPPING THE TAPE: METALS & COAL

Steel Dynamics [STLD  Loading...      ()   ] raised its second-quarter profit forecast that topped Wall Street's targets driven by strong demand for steel and recyled metals, sending its shares up nearly 4 percent.

Meanwhile Alcoa