What’s the word on the Street?
I think it all makes sense, says Karen Finerman. If we’re seeing an economic recovery and things are getting better than there should be inflation concerns. That speaks to the action in Thursday's bond auction.
Looking at the catalyst for stocks, I can’t be that enthusiastic about Alcoa , says Guy Adami. To me the valuations don’t make sense. Yes they made money and they cut costs but this stock is the same price it was last year when they made $7 billion. This time around they made $4.5.
I think we’re seeing profit taking in Alcoa because of the run ahead of earnings, explains Pete Najarian. But I do think there are better names in the space that are cheaper.
If you’re looking for a resource trade, look at copper miner FreeportMcMoRan, adds Adami. I’d get long with a stop at $73.43. I like copper a lot more than aluminum.
GOLD HITS 3RD RECORD CLOSE IN A ROW
Gold set another record on Thursday with the spot price topping $1,050 per ounce. The precious metal has gained about 20 percent this year, driven by dollar weakness and inflation worries after central banks across the globe poured money into the financial system to help stimulate the economy.
What’s the trade?
I’ve been more wrong than right, admits Guy Adami, but gold takes the stairs higher and the elevator down. I’ve seen gold drop $150 in one day. Understand this trade and how difficult it is to get out – at some point I think you'll need to run for the exits.
If you’re playing gold, I’d make sure to also have put protection, counsels Pete Najarian. You never know when we'll see a sharp sell-off.
I agree that eventually gold is going to burst, adds Steve Grasso, but the big questions is at what level. If it’s at $3000 you don’t want to miss the run higher.
RETAILERS ROCKING TODAY
The XRT climbed on Thursday after retailers posted their first monthly sales increase in more than a year. Investors took the results as a sign that consumers might be spending again.
Among the day’s standouts; Macy's, Abercrombie & Fitch and Kohl's. They all surprised Wall Street on Thursday with better-than-expected September sales.
What’s the trade?
ANF may have reported better than expected results, but their results were still lousy. It traded up to 35.20, explains Guy Adami. I still think it’s a short with a stop above $35.20
I was impressed by same-store sales data out of TJX, says Pete Najarian. Although some retailers may be infront of themselves I don’t think this one is.
All retailers can’t run at the same time, adds Steve Grasso. Eventually investors will toss some of them out.
I’m very curious about the holidays, says Karen Finerman. True, Target is dropping prices to compete with Walmart, but inventories are lower and that’s bullish.