The markets have kicked off the second quarter with a bang, Melissa Lee said during Thursday’s Halftime Report, as metals, oil and commodity names rally on stronger-than-expected data. How can you get in on this global growth story?
Word on the Street
Questions were raised about whether or not it was too late to participate in the related stocks, such as Cliffs Natural , but Tim Seymour said the strong numbers reported today make him “a believer” in the global growth that should propel these stocks higher. The good news from the US, UK, China and Brazil was “everything everybody wanted.” Also, though, money was flowing into the market because it was the first day of the second quarter, and “I think that’s a big part of today’s move.”
Zachary Karabell of River Twice Research said he too was a believer in the global-growth story, but even still most indices are up only in the single digits, he said. And a lot of names, such as Vale, haven’t participated in these moves. “I think you can find a lot of opportunities here,” he said, “even with the sentiment being bullish.”
Todd Gordan of Forex.com said the play on China’s strong PMI number is the Australian dollar. He predicted the country’s demand for commodities would power that currency higher.
Friday will bring the much-anticipated March jobs report, but with the market closed investors will have to make their trades on it today. Goldman Sachs, which has a history of accurately predicting the jobs number, this morning cut its growth projections for March to 200,000 from 275,000. Tim Seymour said he expects some census-related job growth this time around, but people have to look at the correlations with the ADP report on private payrolls that came out yesterday. Over the past 10 years, the ADP has been only +/-15,000 jobs versus non-farm payrolls. Goldman and others may have had this in mind when they made their adjustments, he said, but “private payrolls are not going to be as impressive as people think.”
Zach meanwhile said he was focused on a different jobs report – the Steve Jobs report. Apple’s iPad hits the stores on Saturday and Zach thought it offered an interesting juxtaposition between a struggling jobs market and what looks like a “really good” middle and upper-end consumer market.
Mike Gurka of Neural Markets said he saw parallels between Apple in its run-up to the iPad release and tomorrow’s jobs report. People are expected such positive results that shorting these events hasn’t worked. But if either one disappoints, he said, “I see a rocketing lower in the market and then I see massive buying opportunities on a grand scale.”
Todd Gordon said that as hot as Apple is right now, he could only recommend buying it on a pullback.
Two “Under the Radar” stocks hitting 52-week highs today are Foot Locker and Finish Line , after both received upgrades from FBR Capital analyst Eric Tracy. He told Fast Money today that a “strengthening product cycle in athletic footwear” against “increasingly easy compares supports visible and more importantly sustainable top and bottom line growth over the next several quarters.” Couple that with a still-attractive valuation, and he thinks risk-reward “is still compelling here.” Tracy also said the Nike would be “the biggest beneficiary” of this cycle and that FBR “would absolutely be buyers” of the stock ahead of its analyst day in early May.
Auto sales were being released today, and General Motors officially outsold Ford for the month of March. Zach said that while GM is a bigger company, Ford is a better company, specifically in terms of execution and product diversity. But he admitted he’s “a little wary of these stocks just in general.”
Call the Close
Gurka said he’d continue to target 1,257 on the S&P 500, buying every dip, and he thinks the weakness in the dollar “is a great opportunity to buy here.”
Gordon thinks the level on the S&P is 1,220. He’ll be watching the RBA meeting next week and he reiterated his long call on the Australian dollar.
Zach wouldn’t recommend aggressive buying right now, saying he thinks “the markets are done until next week.” If you’re in, stay in, he said. If you’re out, stay out.
And lastly, Tim agreed with Zach, saying that with a four-day weekend ahead “guys are not going to put more on today.”
Tim Seymour owns Ford and the FXI.
Tim Gordon is long the Australian dollar.
Zach Karabell owns Apple, the FXI and Vale.
FBR Capital is a market maker or liquidity provider for Finish Line.
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CNBC.com with wires