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Rally In Walmart's Hands?

Investors are turning their attention to retail sector with some of the nation’s biggest stores due to report earnings next week.

Probably the most anticipated report comes from Walmart , whose results should provide another glimpse into the state of the consumer. In fact, Walmart is so dominant in the lives of Americans it now accounts for roughly 8 cents of every dollar of retail sales generated in the United States (excluding automobiles).

It comes as no surprise that what Walmart says will likely move the market. But could it make or break the rally?

David Abella, a portfolio manager at Rochdale Investment Management, which owns Wal-Mart stock, said if Wal-Mart were to report better-than-expected sales and profits on Aug. 13, it could be seen as another sign pointing toward recovery. The bulls would likely pounce all over those kind of results.

However, "If their results are disappointing, I think it would question the whole health of the consumer," he said. And as a result the bears could get a foothold.

Of course Walmart isn't the only big retailer offering a glimpse into the state of consumer spending. Take a look at what’s ahead:

Tuesday: Fossil
Wednesday: Macy’s, Liz Claiborne
Thursday: Walmart, Kohl’s, Nordstrom
Friday: Abercrombie, JC Penney

With so many reports coming out of the retail sector, how should you be positioned going into next week?

For me the trade is Walmart , says Steve Grasso. They’re just a breed apart.

I like Walmart too, adds Pete Najarian. But it’s a slow money trade.

I’d take the other side of the trade, counters Joe Terranova. I like Target better. They’ve reduced prices 4% year on year and the consumer is all about thrift right now.

What do you think? We want to know?

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Trader disclosure: On Aug. 7th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Seymour Owns (AAPL), (AA), (BAC), (BX), (TCK), (USU); Seygem Asset Management Owns (CZZ); Grasso Owns (ASTM), (BAC), (COST), (CSCO), (FAZ), (PFE), (PRST), (V), (WMT), (XLF); Terranova Owns (MCD), (RIMM), (AMZN), (MSFT); Terranova Is Short (F), (TM); Najarian Owns (AA) Call Spread; Najarian Owns (BUCY) And Is Short (BUCY) Calls; Najarian Owns (GS), Owns (GS) Puts, Is Short (GS) Calls; Najarian Owns (HIG) Calls; Najarian Owns (INTC) And Is Short (INTC) Calls; Najarian Owns (JPM) And Is Short (JPM) Calls; Najarian Ownws (MS) And Is Sohrt (MS) Call; Najarian Owns (MSFT) And Is Short (MSFT) Calls; Najarian Owns (V) And Is Short (V) Calls; Najarian Owns (YHOO) Call Spread; Najarian Owns (NSC) And Is Short (NSC) Calls; Najarian Owns (CSCO) And Is Short (CSCO) Calls

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For Steve Grasso:
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Stuart Frankel And/Or Its Partners Own (GERN)
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Stuart Frankel And/Or Its Partners Own (PDE)
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Stuart Frankel And/Or Its Partners Own (RDC)
Stuart Frankel And/Or Its Partners Own (ROK)
Stuart Frankel And/Or Its Partners Own (TLM)
Stuart Frankel And/Or Its Partners Own (TMK)
Stuart Frankel And/Or Its Partners Own (XOM)
Stuart Frankel And/Or Its Partners Own (XRX)
Stuart Frankel And/Or Its Partners Own (SDS)
Stuart Frankel And/Or Its Partners Are Short (QQQ)
Stuart Frankel And/Or Its Partners Are Short (CL)

For Joe Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Terranova Is Co-Portfolio Manager Of The Virtus Diversifier PHOLIO
Virtus Diversifier PHOLIO Owns (IGE)
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Virtus Investment Partners Owns More Than 1% Of (ABD)
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Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (DBC)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (SKT)
Virtus Investment Partners Owns More Than 1% Of (TNB)
Virtus Investment Partners Owns More Than 1% Of (UA)
Virtus Investment Partners Owns More Than 1% Of (CLB)
Terranova Owned (MSFT) On 7/22/09

For Scott Nations
Nations Owns (C) Calls And Is Short (C) Puts

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