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Halftime: Can Bulls Keep The Mojo Alive?

The bulls held their ground on Friday with both the Dow and S&P in the green as Wall Street breathed a collective sign of relief over the latest jobs report.

Although the data still showed the economy shed 54,000 jobs overall, that wasn’t nearly as bad the Street feared. (In fact, private employment, considered a better gauge of labor market health, increased by 67,000.)

The bulls contend the jobs number was only the latest major report that showed the economy may be on the mend.

Earlier this week ISM shocked investors by defying expectations of a decline and showing factory output increased. Also this week China's manufacturing sector staged a rebound and Australia's economy grew at the fastest pace in three years in the second quarter.

Is relatively positive economic data enough to keep the bullish mojo going in the stock market?

Instant Insights with the Fast Money traders

I think the rally is sustainable, says Joe Terranova. Money managers who are overweight government debt will probably start to reallocate. The latest ISM data, jobs numbers and China PMI should all increase investors appetite for risk. The right trade is the hard trade; buy the market right here.

This is a slow week, reminds Steve Grasso. Because the move higher is on light volume, if you’re a retail investor I wouldn’t let these moves dictate your outlook on the market. I definitely would not go all into this rally. Until the S&P breaks above 1130 I think the market is stuck in a range.

However if you’re a trader, adds Grasso, I’d keep an eye on 1107 the 100 day moving average, If the market breaks above that I think it goes to 1115.

I can’t help but wonder if this is the new normal, says Terranova, that is if we’re going to ever see volumes to return to what they once were.

I’m playing the market by selling the rips and buying the dips, counsels Jon Najarian. I think we’re still range bound and that strategy seems to be the best way to play the market lately.

I’m seeing retail investors come into this market, adds JJ Kinahan, but not with all guns blazing. Although that tends to be a contrarian indicator I think this time they’re coming into the market in a cautious and educated fashion.

What do you think? We want to know!


Get more trading insights. Click here to check out how Doug Kass suggests gaming the market!











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TOPPING THE TAPE: BANKS

Financials topped the tape on Friday with Goldman sharply higher.

How should you play banks?

I’m bullish Goldman at these levels, says Joe Terranova.

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TOPPING THE TAPES: GLOBAL ECONOMIC NAMES

The American economy may be on edge, but the world-wide trade is showing surprising strength. Commodities, industrials and transport names were all up on Friday.

What’s the trade?

Manufacturing has been resilient this year, muses Joe Terranova. In the space I’d look at Caterpillar, Deere , Eaton , Bucyrus and Joy Global as names you can own.

I’m cautious, counters Steve Grasso. We saw a lot of short covering in this space and that could have generated some of these gains.

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FLEE SAFETY TRADES?

Investors continue to turn away from the safety trades with gold dipping after approaching record territory and money continuing to flow out of the bond market.

What’s the trade?

The safety trade isn’t falling out of bed, says Steve Grasso. Nothing goes up in a straight line; I think these declines are simply part of a healthy market.


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OIL FALLING AS HURRICANE EARL DOWNGRADED TO CATEGORY 1

Traders are keeping a close eye on the price action of oil after Hurricane Earl was downgraded and could even slide to Tropical Storm status by the time it makes landfall.

What’s the trade?

I wouldn’t play the spot price but I’m still bullish Occidental , Suncor as well as Apache, says Joe Terranova.

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BUSINESS TRAVEL COMING BACK?

If private employers are starting to hire again here in the US, that could be a sign that business travel is about to pick up, domestically too.

InterContinental Hotels operates around the world with its biggest region in the Americas.

For insights on the travel and hospitality business, the Fast Money desk turned to someone at the forefront of this industry; IHG President, Americas region, Jim Abrahamson.

Check out the conversation. Watch the video now!
















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CALL THE CLOSE

Joe Terranova: The right trade is the hard trade; buy the market right here.
Steve Grasso: 1107 is the 100-day moving average, If the market breaks above that I think it goes to 1115.
Jon Najarian: I like the market.
JJ Kinahan: I would never sell a slow day into a holiday.


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Trader disclosure: On September 3rd, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (APA), (AAPL), (BMO), (FCX), (GS), (IBM), (MRVL), (QCOM), (OXY), (SU), (XBI), (C), (POT), (GLD), (TBT); Grasso owns (ASTM), (BA), (BAC), (C), (CSCO), (JPM), (LPX), (MO), (MOT), (NDAQ), (PFE), (PRST); Jon Najarian owns (GS), short calls; Jon Najarian owns (X), short calls; Jon Najarian owns (FAS), short calls; Jon Najarian is short (ULTA); Kinahan owns (WFC)

For Joe Terranova
Terranova is chief market strategist of Virtus Investment Partners, LTD.
Virtus Investment Partners own more than 1% of (ABAX)
Virtus Investment Partners own more than 1% of (ALK)
Virtus Investment Partners own more than 1% of (AMKR)
Virtus Investment Partners own more than 1% of (CASS)
Virtus Investment Partners own more than 1% of (CSVI)
Virtus Investment Partners own more than 1% of (XLY)
Virtus Investment Partners own more than 1% of (XLP)
Virtus Investment Partners own more than 1% of (DRYS)
Virtus Investment Partners own more than 1% of (EXR)
Virtus Investment Partners own more than 1% of (XLI)
Virtus Investment Partners own more than 1% of (IGE)
Virtus Investment Partners own more than 1% of (LDR)
Virtus Investment Partners own more than 1% of (LPHI)
Virtus Investment Partners own more than 1% of (XLB)
Virtus Investment Partners own more than 1% of (MGRC)
Virtus Investment Partners own more than 1% of (NRCI)
Virtus Investment Partners own more than 1% of (DBV)
Virtus Investment Partners own more than 1% of (SUBK)
Virtus Investment Partners own more than 1% of (XLK)
Virtus Investment Partners own more than 1% of (XLU)
Virtus Investment Partners own more than 1% of (WDFC)
Virtus Investment Partners own more than 1% of (YDNT)

For Steve Grasso:
Stuart Frankel & Co and it’s partners own (BAX
Stuart Frankel & Co and it’s partners own (COG)
Stuart Frankel & Co and it’s partners own (CUBA)
Stuart Frankel & Co and it’s partners own (DHR)
Stuart Frankel & Co and it’s partners own (GERN)
Stuart Frankel & Co and it’s partners own (HPQ)
Stuart Frankel & Co and it’s partners own (HSPO)
Stuart Frankel & Co and it’s partners own (MERC)
Stuart Frankel & Co and it’s partners own (NWS.A)
Stuart Frankel & Co and it’s partners own (NYX)
Stuart Frankel & Co and it’s partners own (PDE)
Stuart Frankel & Co and it’s partners own (PFE)
Stuart Frankel & Co and it’s partners own (PRST)
Stuart Frankel & Co and it’s partners own (RDC)
Stuart Frankel & Co and it’s partners own (TLM)
Stuart Frankel & Co and it’s partners own (TRV)
Stuart Frankel & Co and it’s partners own (XRX)
Stuart Frankel & Co and it’s partners own (SDS)
Stuart Frankel & Co and it’s partners are short (QQQQ)







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