Strategy Session with the Fast Money Traders
The whisper number for the jobs report suggests that things may not be as bad as investors feared, reveals Tim Seymour. Going into Friday, the jobs number could position us for a decent run.
I think the headwinds aren’t employment numbers but the flood of Treasuries coming onto the market next week, says Joe Terranova.
Next Week’s Treasury Auctions
Monday 3 Month Bills $31B
6 Month Bills $31B
Tuesday 3 Year Notes $35B
Wednesday 10 Year Bonds (3 1/8) $19B
Thursday 30 Year Bond (4.25) $11B
We’d all better hope that China will step up and buy the long-end, adds Terranova. Because if they don’t, who will?
The Treasuries scare me too, adds Karen Finerman. And it could be scary for our whole economy. That's not to say the amount of debt were issuing is going to be a problem in the next week,it's not. But long term I think it’s a serious issue.
OIL HITS 7-MO. HIGH
A surge in crude oil prices underpinned the broader market after Goldman Sachs raised its year-end oil price forecast to $85 a barrel, saying economic stabilization and tight supplies should bode well for prices.
I’d be careful of the Goldman outlook, says Pete Najarian. That’s the same team that called for $200 oil last summer.
I read that as Goldman Sachs is long oil, chuckles Karen Finerman.
The move higher in oil is positive, explains Joe Terranova. Oil is the proxy for global growth, he says. China is actively buying oil – it is, in essence the global currency.
If you’re looking to trade the space I’d do it with solar, counsels Pete Najarian. Take a look at Yingli . Recent options action has been bullish in this name.
GOLDMAN LEADS FINANCIALS HIGHER
Shares of both Goldman Sachs and Morgan Stanley exploded higher Thursday afternoon after analyst Brad Hintz raised his price target and earnings estimates for both banks.
Hintz raised his rating on Goldman Sachs to "Outperform" from "Market Perform" with a price target of $176. He rates Morgan Stanley as "Outperform" with a price target of $37.
Hintz tells Fast Money he made those upgrades based on his belief that the securities market is poised for a sustainable recovery that should extend into 2010 due to an improvement in fixed-income trading.
"Lehman and Bear are gone. Citi and Bank of America have been hobbled by the government. So wins? It's Goldman," he says.
The same should be true for Morgan Stanley and JPMorgan , speculates Joe Terranova.
UNITED PLANNING MASSIVE JET ORDER
Plane maker Boeing popped Thursday after UAL Corp , the parent of United Airlines, asked the aviation giant and its European competitor to bid on an order of up to 150 planes.
It’s interesting to me that United Airlines is doing this now, rather than doing it during better times, muses Karen Finerman.
I like Boeing, says Joe Terranova. And I’d look at Spirit AeroSystems .
I think the play is RTI International and Titanium Metals, adds Tim Seymour. Planes are made of titanium.
RETAILERS SLIDE AS MAY SALES DISAPPOINT
The RTH closed lower after most retailers posted disappointing May sales as recession-weary shoppers cut spending at stores ranging from high-end chains to discounters such as Target .
Sales were weaker than expected at 63 percent of the 30 retailers tracked by Thomson Reuters. Upscale chains posted some of the worst May sales at stores open at least a year, or same-store sales
The specialty retailers ran up so far so fast, it doesn’t surprise me that their same store sales were terrible, adds Karen Finerman. I think the play is short the XRTand longWal-Mart.
In the space I’d look at Kohl’s, says Joe Terranova. That stock has been working.
I’d stay away from retail, counsels Pete Najarian. If you want to play consumers I’d do it with Visa. Or look at Dollar Tree.
DEVELOPING STORY: SEC CHARGES MOZILO WITH FRAUD
CNBC’s David Faber tells the desk that the SEC has charged Angelo Mozilo, the former chairman and CEO of Countrywide Financial, with insider trading.
The SEC also charged the company's former chief operating officer, David Sambol, and former financial chief, Eric Sieracki, with securities fraud for failing to disclose the firm's relaxed lending standards in its 2006 annual report.
As CNBC reported earlier, the charges were not be accompanied by any criminal indictments.
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Trader disclosure: On June 4th, 2009, 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 (BX) Call Spread; Najarian Owns (DELL) Calls; Najarian Owns (FCX) Call Spread; Najarian Owns (INTC) Call Spread; Najarian Owns (MOS) Call Spread; Najarian Owns (PALM) Calls; Najarian Owns (WNR) Call Spread; Terranova Owns (FCX), (TER), (XBI), (RIMM), (GENZ); Terranova Owns (X) & (X) Calls; Terranova Owns (BRCM) & (BRCM) Calls; Terranova Owns (DIS) Call Spread; Terranova Owns (POT) & (POT) Calls; Terranova Owns (JPM) & (JPM) Calls; Terranova Owns (BTU) & (BTU) Calls; Terranova Owns (MS) & (MS) Calls; Najarian Owns (ELN) & (ELN) Calls; Finerman's Firm Owns (FLIR); Finerman Owns (TBT); Finerman's Firm Owns (AXYS), (NOK), (PBR), (TBT), (RIG), (WMT), (MRO); Finerman's Firm And Finerman Own (BAC) Preferred Shares And Are Short (BAC); Finerman's Firm And Finerman Own (WFC) Preferred Shares, Finerman's Firm Is Short (WFC); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO); Seymour Owns (TTM), (AAPL), (BAC), (BX), (EEM), (FXI), (TSO), (INFY), (MGM), (TIE); Seymour Is Short (NUE); Seymour's Firm owns (MBT)
For Brad Hintz
Hintz Owns (MS)
Bernstein Owns (MS)
Bernstein Owns (GS)
(GS) & (MS) Have Been Clients of Bernstein In The Last 12 Months
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