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Halftime Report: Are Bears Starting To Gain Traction?

Thursday, 17 Sep 2009 | 1:08 PM ET

Investors were desperately seeking direction on Thursday as they weighed better than expected economic data against disappointing sales numbers from Oracle and FedEx .

On the bright side, the number of U.S. workers filing new claims for jobless benefits fell unexpectedly last week, and new U.S. housing starts and permits increased to their highest level since November.

And on the not so bright side FedEx shares slipped after revenues missed expectations and the company said the economic downturn was weighing on shipping volumes.

In tech Oracle spooked investors after software sales came in sharply below expectations however Apple hit 52-week highs.

Fast Money Halftime Report
The Fast Money traders weigh in on the markets and share their midday trading advice.

Where are traders placing their bets?

I’ve been bearish on the market and Oracle’s report scares me, says Fast Money trader Guy Adami. It seems investors are ignoring the message.

With Apple trading at a 52-week highs, I’d wait for it to pull back but I stand by my $200 target, muses Patty Edwards of Storehouse Partners.

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TRANSPORTS TRYING TO FIGHT HIGHER?

FedEx weighed down the Dow Transports on Tuesday with its revenue miss, however American Airlines bucked the trend and shot higher after the company said it had bolstered its liquidity and planned to take steps that include buying new planes in a bid to return to profitability.

What’s the trade?

If you want to play transports I’d look downstream, counsels Guy Adami. Look at Rockwell Collins. That’s where I’d be going.

If you want to play the rails you have to believe in the inventory restocking cycle, says Brian Kelly of Kanundrum. And the rails haven’t really participated in the rally so I think you could see a little pop.

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GOLD STEADY AFTER HITTING COMEX RECORD

Gold prices hovered near 18-month highs on Thursday, largely due to dollar weakness.

What’s the trade?

I’m still a buyer of gold, reveals Brian Kelly. I’d buy half a position here and if gold drops I’d buy the other half.

But two Fed governors are talking about tighter policy, counters Jim Iurio of TJM. If the dollar gets stronger gold could see $960 very quickly.

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TAKE YOUR POSITION: PALM EARNINGS AFTER THE BELL

Palm releases earnings after the bell with investors eager to learn more about the subscriber base for the Palm Pre, launched in June.

“We believe Palm will continue to struggle as it competes against much larger competitors such as Apple, Research in Motion and Nokia . The first quarter results will provide a better picture about whether Palm will be able to sustain in front of its large competitors who are eating into its market share by developing competitive products,” writes Zacks Equity Research.

What’s the trade?

I don’t think Palm is seeing big sales, muses Patty Edwards. For a smartphone trade I’d go with RIM or Apple.

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TRADE TO GO: OIL SERVICES PLAY

Guy Adami suggests putting Schlumberger on your radar. I’d play it short. The valuations don’t make sense to me. If the tape rolls over or oil rolls over this stock should too.

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CALL THE CLOSE

Guy Adami: I’m a seller.
Jim Iuorio: I’m a seller.
Patricia Edwards : I’m out.
Brian Kelly: I’m a seller, but maybe I'd buy on the last tick just because of all the negative sentiment.


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Trader disclosure: On Sept. 17, 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 (AA), (F), (BAC), (EEM), (FXI), (SBUX), (VIP); Seymour's Firm Owns (MTL); Finerman's Firm Owns (BAC) Preferred Shares, Finerman Owns (BAC) Preferred Shares And Owns (BAC); Finerman Owns (PDE); Finerman's Firm Owns (WFC) Preferred Shares And Is Short (WFC); Finerman Owns (WFC) Preferred Shares; Finerman Owns (RIG) ; Finerman's Firm Owns (WMT), (RIG), (MSFT), (NOK), (PBR), (PDE), (TGT); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO), (IYR); Najarian Owns (AAPL) & Short (AAPL) Calls; Najarian Owns (ACI) Call Spread; Najarian Owns (BAC) & Short (BAC) Calls; Najarian OWns (C) Calls; Najarian Owns (CUX); Najarian Owns (FCX), Owns (FCX) Put, Is Short (FCX) Calls; Najarian Owns (GE) Calls; Najarian Owns (JPM) & Is Short (JPM) Calls; Najarian Owns (JOYG) & Short (JOYG) Calls; Najarian Owns (MS) And Is Short (MS) Call; Najarian Owns (MSFT) And Is Short (MSFT) Call; Najarian Owns (PALM) Calls; Najarian Owns (RIMM) Call Spread; Najarian Owns (TEVA); Najarian Owns (V) & Short (V) Calls; Najarian Owns (WFC) Put Spread; Najarian Owns (YHOO) Calls ; Najarian Owns (WNR) Calls; Terranova Owns Gold Futures; Terranova Owns Dec Crude Contracts; Terranova Owns Dec 2010, Dec 2012 Crude Contracts; Terranova Owns (WNR) & (WNR) Calls; Terranova Owns (HOC)

For Dennis Gartman
Gartman Owns Gold
Gatman Owns Canadian Dollar

CNBC.com with wires

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SLB
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