Halftime Report: Will Weak Consumer Draw Out Bears?
On Tuesday consumer confidence hit a 10-month low; how likely are stocks to do the same?
Considering consumer discretionary has been the best performing sector of the S&P 500 over the past 3 months, that's not as dramatic as it first sounds.
And headwinds appear to gaining force. Also on Tuesday; the Standard & Poor's/Case-Shiller index slipped unexpectedly. And worries about Europe's financial woes are mounting.
What must you know before you place your next bet?
Instant Insights with the Fast Money traders
I don’t think the action in the S&P 500 is simple profit taking, speculates Joe Terranova. I think we’re seeing a change in momentum.
I agree that this is a sea change, echoes Guy Adami. I think the consumer is in trouble. The trade going forward is short the specialty retailers that are over priced. And broadly I think the market is heading lower.
All those buy orders from last week have dried up; they may have been nothing more than a melt-up into expiration, muses Gary Kaminsky. I agree that we’re heading lower.
I’m actually impressed that the market is doing as well as it is, counters Pete Najarian. Considering how bad the consumer confidence report was, I would think the market would be down a lot more.
And if you’re looking for a trade, I’d look at RadioShack , adds Najarian. It’s an opportunity on the pullback.
FITCH DOWNGRADES GREEK BANKS
The Greek tragedy that has gripped Wall Street began its a second act on Tuesday after Fitch downgraded four of Greece's largest banks.
What’s the trade?
I’m short the European markets because I believe the economic climate continues to deteriorate, says Gary Kaminksy, and I’m playing it with the EPV .
I agree, says Guy Adami. I think it gets worse before it gets better.
For a down stream trade, I’d be a buyer of Canadian debt or German debt, says Joe Terranova. It’s being sold off because of Greece.
MARKET BUZZKILL: STRONG DOLLAR CRUSHES COPPER
A greenback rally left commodity stocks in the red on Tuesday with the rising dollar hitting copper particularly hard.
What’s the trade?
I was wrong about copper, admits Joe Terranova. I thought when China came back from holiday the re-stocking process would resume, but over the last two days I’ve seen nothing but selling.
CHART OF THE DAY: FINANCIALS
Turning to the chart of the day – financials were trading lower around lunchtime – that is except for Goldman Sachs.
Goldman stock is making a nice run at that key technical level of $160 -- but fighting a downtrend as the 50-day crosses below the 200-day moving average.
What’s going on?
I think the move higher was generated by closet indexers who must be in financials, says Gary Kaminksy. With all the problems in Europe they don’t want to be in European banks so I think they take a long position in Goldman because it’s less likely to surprise.
I think the move in Goldman is short-covering, counters Joe Terranova. Nothing more.
If you’re in Goldman stock, I’d take profits on the bounce, adds Guy Adami, especially if you believe the stock market is heading lower.
EAR TO THE WALL: PALM
Two big downgrades hammered shares of Palm on Tuesday with the traders noticing an unusual degree of options activity in the March 9-strike puts; they saw three times their normal volume yesterday.
What must you know?
It looks like somebody knew something, muses Pete Najarian.
FAST EXCLUSIVE: FREEPORT MCMORAN
If you want to take the pulse of the global economy, you need to talk about copper and Freeport McMoRan, the world's largest publicly traded copper producer.
FCX has become the proxy stock for global growth, says Guy Adami. $75.45 has been the pivot price. Below that you get out and above that you get in.
For further insights who better to talk to than Richard Adkerson the CEO of Freeport McMoRan. Find out what he has to say about the strength of the global recovery. Watch the video now!
FAST FLASH: EXPEDITORS INTERNATIONAL
The traders see a lot of pain in the market on Tuesday - except for couple names. one in particular.
Fast Money favorite, Expeditors International, looks like it’s breaking out to a 52 -week high on a massive earnings blow-out.
It is the only member of the Dow Transports that is higher in today's tape. What’s the trade?
I think this is a company that’s going to grow organically, muses Gary Kaminksy.
FAST EXCLUSIVE: FINDING VALUE AFTER BIG MARKET RALLY
They say one man's trash is another man’s treasure And as CEO of Third Avenue management, David Barse has found gems through investing in deep-value assets.
His company has over $16 billion management, and his firm's flagship fund has beaten the S&P in eight out of the last ten years.
Brookfield Asset Management makes up about 9% of Barse’s portfolio. There’s speculation BAM is looking to make a bid for General Growth, one that would rival the bid from Simon Properties.
Barse talks candidly about the speculation. What must you know?
Watch the video now!
CALL THE CLOSE
Pete Najarian: I’m bullish Petrohawk
Joe Terranova: I'm a buyer of Kraft
Gary Kaminksy: Watch the auction carefully.
Guy Adami: Petrohawk on the bell.
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Trader disclosure: On February 23, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Kaminsky Owns (EXPD), (EPV); Kaminsky Owns (LULU) Puts; Terranova Owns (IBM), (QCOM), (GOOG), (EMC), (AAPL), (DELL), (MSFT); Najarian Owns (HK) Call Spread; Najarian Owns (INTC) Calls; Najarian Owns (MS); Najarian Owns (RSH) Call Spread; Adami Owns (INTC), (GS), (AGU), (MSFT), (NUE), (C), (BTU), (AGU); Finerman's Firm Is Short (IJR), (IWM), (MDY), (SPY), (UNG),, (USO); Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Owns (BAC), (BAC) Preferred; Finerman's Firm And Finerman Own (CVS), (GOOG), (JPM), (WFC); Finerman's Firm Owns (IBM), (TGT), (WMT)
For Joe Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of (DLR)
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 (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (SKT)
For David Barse
Third Avenue Management Owns (WY)
Third Avenue Management Owns (ECA)
Third Avenue Management Owns (KEY)
Third Avenue Management Owns (BAM)
For Jared Levy
Peak6 Investments Owns And Has An Options Position In (AAPL)
Peak6 Investments Owns And Has An Options Position In (CERN)
Peak6 Investments Owns And Has An Options Position In (MDRX)
Peak6 Investments Is Short And Has An Options Position In (QSII)
Peak6 Investments Owns And Has An Options Position In (IBM)
Peak6 Investments Is Short And Has An Options Position In (ACN)
Peak6 Investments Is Short And Has An Options Position In (CRM)
Jared Levy Recommends Being Short (AAPL) Call Options In His Options Trade Alerts Account
For Dennis Gartman
Funds Managed By Dennis Gartman Are Short Euro
Funds Managed By Dennis Gartman Are Short British Pound
Funds Managed By Dennis Gartman Are Long Canadian Dollar
Funds Managed By Dennis Gartman Are Long Australian Dollar
Funds Managed By Dennis Gartman Own (PGH)
Funds Managed By Dennis Gartman Own (GLD)
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