Is Bank Rally a Buy Signal?

Friday, 9 Dec 2011 | 1:27 PM ET

Bank stocks rebounded midday Friday along with the broader market, but the “Fast Money” pros said that wasn’t reason enough to jump back into the trade.

“I see absolutely no reason to get involved,” said Patty Edwards of Trutina Capital. “I can hit my head against the table and still get the same amount of pain.”

The financial sector posted a 1.89 percent gain at 1 p.m., outpacing the S&P.

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Trader Steve Grasso of Stuart Frankel noted that bank stocks were only back up to where they were two days ago,

“If you’re going to be a day trader and you’re trading these things for big swings, I guess you can do that, especially with Bank of America,” he said. “Other than that, I would probably wait for the next shoe to drop.”


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J.J. Kinahan of TD Ameritrade said a couple other plays might include Goldman Sachs and JP Morgan.

“I wouldn’t say just go out and buy all financials, but I do think there are some selected names in there that are still good buys for both longer and shorter term,” he said.

Kinahan said the presidential election would create urgency to keep the financial sector healthy, which in turn would bolster the banks.

Patty Edwards said politics could play out another way.

“We need to keep them healthy from a political perspective,” she said. “On the other hand, they have been the biggest punching bag, and I think it’s going to stay in the politicians’ minds that they are a bad thing.”

Trader Zack Karabell said it was difficult to see investments other than day trades, given the financial crisis the banks are facing.

“None of these issues are going to magically disappear,” he said.

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Trader disclosure: On Dec. 9, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns D; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU; Karabell is long AAPL; Karabell is long IBM;

Steve Grasso
Stuart Frankel & Co and its partners own CSCO

Stuart Frankel & Co and its partners own CUBA

Stuart Frankel & Co and its partners own GERN

Stuart Frankel & Co and its partners own HPQ

Stuart Frankel & Co and its partners own HSP

Stuart Frankel & Co and its partners own HSPO

Stuart Frankel & Co and its partners own MET

Stuart Frankel & Co and its partners own MSFT

Stuart Frankel & Co and its partners own MU

Stuart Frankel & Co and its partners own NYX

Stuart Frankel & Co and its partners own PRST

Stuart Frankel & Co and its partners own UAL

Stuart Frankel & Co and its partners own XRX

Zack Karabell
Rivertwice is short XLF

Rivertwice is short Smh

Rivertwice is long DD

Patty Edwards
Trutina Financial is long APPLE (AAPL)

Trutina Financial is long SPDR GOLD TRUST (GLD)

Trutina Financial is long MICROSOFT (MSFT)

Trutina Financial is long INTEL (INTC)

Trutina Financial is long TEXAS INSTRUMENTS (TXN)

Trutina Financial is long DUPONT (DD)

Trutina Financial is long BERKSHIRE HATHAWAY (BRK)

Trutina Financial is long COSTCO (COST)

Willie Williams
No disclosures

Jeff Kilburg
No disclosures

Greg Zuckerman
No disclosures

Meyer Shields
No disclosures

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