Halftime Report: Is Goldman Stock Bonus A Buy Signal?
Stocks advanced on Thursday, despite the stronger dollar, as investors focused on positive economic data instead.
And midday, Goldman stepped into the market spotlight after the firm said its top executives will receive stock instead of cash bonuses this year and that the stock cannot be sold for at least five years.
What should you be watching?
I’m watching Goldman, says OptionMonster Jon Najarian. I take their decision as an endorsement of the stock at these levels. These guys are locked in for 5 years. Personally, I expect the Goldman news to help lift the market and as a result, I’m a buyer into the close.
I’m closely watching moves in the dollar and other currencies, adds Todd Gordon of Forex.com. With the anemic bounce in the commodity market and equities hanging around the 1100 level, I think it’s time to play a stronger US dollar and 92 as resistance on the FXA.
I’m watching the dollar index, says Jeff Tomasulo of SMB. It’s trading over its 50-day moving average. That suggests the dollar may be breaking its downward trend. It wouldn’t surprise me to see that trend get rid of the “weaker hands of the shorts.”
CITI HIGHER AS TARP PAYBACK TALK HEATS UP
Shares of Citi traded higher on Thursday after CNBC reported the bank may raise $10 billion to $15 billion in a share offering to help repay the TARP, not the $20 billion initially proposed.
Shareholders are balking at the $20 billion issue because it would dilute the value of Citi's stock sources said. They would prefer instead to raise $10 billion to $15 billion. As a result, Citi is weighing whether to use more internal funds to repay the TARP.
The bank received $45 billion of TARP money last year under two different rescues. In a third rescue this year, it agreed to convert $25 billion of TARP preferred shares into common stock, giving the US government a roughly 34 percent stake in the company.
What’s the bank trade?
With all the problems at Citi, I just can’t bring myself to buy this stock, says Jeff Tomasulo. I think there are better places to put money to work in the sector.
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AOL BEGINS TRADING TODAY
Shares of AOLslipped in its return to trading on the New York Stock Exchange on Thursday, after the Internet company was spun off from Time Warner.
As an independent company, AOL will refocus on technology, online media content and branded display advertising in a bid to capture marketing dollars as they migrate online.
What’s the trade?
I expect AOL could drift lower in the near-term, muses Jon Najarian. But then I think we might hear Google, Yahoo! or Microsoft is interested in an acquisition, if in fact shares trade lower.
As a technical trader I’m waiting to see the price patterns before I can step in, says Todd Gordon.
OPTIONS ACTION: ENER
Keep an eye on the solar space, counsels Jon Najarian. I’ve spotted unusual options activity in Energy Conversion Devices. The volume of Dec 11 and Dec 12 calls traded on Thursday, leads me to believe big investors are betting this stock will make a significant move to the upside.
FAST & FURIOUS: THE KEY QUESTIONS INTO THE CLOSE
BUY ASSET MANAGER? Goldman upgraded asset managers to attractive on Tuesday; should you buy?
I like this group and have liked it for a while, says Guy Adami.
BUY VIACOM? Jefferies initiated coverage of Viacom on Thursday with a $40 price target; should you get in?
I’m a buyer, says Jon Najarian. I think it gets a boost from the UBS conference but I’ll get out by Friday afternoon.
BUY RIMM? RIM traded higher following its distribution deal with China Mobile; should you buy?
I’m cautious, says Jeff Tomasulo. If it consolidates at $65 I’m a buyer up to $70.
BUY OIL?Oil and oil service names trading to the upside today, is it time to get back on this trade?
I’d stay away, says Todd Gordon. I think the underlying crude market is pretty anemic. Diamond Offshore and Transocean have both broken daily trend line support.
TRADE TO GO: AMAT
The volume of Applied Materials January 14 calls traded on Thursday suggests this stock could make a sharp move higher, says Guy Adami.
CALL THE CLOSE
Guy Adami: I’m a seller.
Jon Najarian: I’m a buyer into the close. I think the Goldman news helps lift the market.
Jeff Tomasulo: I’m a buyer.
Todd Gordon: I’m a seller. I think 1100 S&P is vulnerable
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Trader disclosure: On December 10th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Finerman's Firm Owns (MSFT), (WMT), (AAPL), (FLS); Finerman's Firm Is Short (IJR), (IWM), (SPY), (MDY); Finerman's Firm Is Short (UNG); Finerman's Firm Owns (BAC) Preferred, (BAC), (BAC) Call Spread; Finerman Owns (BAC) Preferred, (BAC); Finerman's Firm And Finerman Own (WFC) Preferred; Seymour Owns (AAPL), (EMM), (INTC), (PFE), (TKC), (BAC), (FXI), (GE), (POT); Seymour's Firm Owns (MTL); Najarian Owns (BRCD), ; Najarian Owns (PFE); Najarian Owns (TEVA); Najarian Owns (AAPL) Calls; Najarian Owns (DELL) Calls; Najarian Owns (FCX) CAlls Spread; Najarian Owns (INTC), Is Short (INTC) Calls; Najarian Owns (TXN), Is Short (TXN) Calls; Najarian Owns (RIMM) Call Spread
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