Bernanke & Bond Boys Knock Stocks:
The headline: Bernanke’s Inflation Comments, Highest Bond Yields in 9 Months Snap S&P 500 5-Day Streak
The word: People were expecting a rate cut to come at some point, but Bernanke’s comments seemed to indicate the Fed thinks everything is fine, Eric Bolling says. “This is really good for the market.” It’s more of an indication that the market is taking a breather, Eric says. Guy agrees: “The market got way too ahead of itself in terms of a rate cut.”
Tele-Consolidation:
The headline:Avaya (AV) Goes Private For $8.2b, While WSJ Says Vodafone (VOD) May Be Takeover Target
The word: Vodafone is the buy here, Guy says. Pete Najarian recommends taking a look at Alvarion (ALVR), an Israeli wireless company where options volatility has been “through the roof.”
At Your Oil Service:
The headline: The Oil and Gas Services Trade Following Dominion Resources (D) Deal; Dominion said Yesterday It Would Sell Most of its U.S. Onshore Energy Assets to Loews (LTR) and XTO Energy (XTO)
The word: The entire oil services sector is on fire, Pete says. He would buy almost all of them, including Baker Hughes (BHI) and Schlumberger (SLB). Guy likes Loews as this move diversifies the company away from its roots in tobacco.
Ameritrade After Hours Action:
The headline:TD Ameritrade (AMTD) Jumps in Extended Trading After Steve Cohen’s Firm, Others Ask for Merger
The word: The guys all agree that everything is in play, especially the brokerage space. Guy thinks there’s still upside potential in Ameritrade, and Jeff and Pete would both buy it at the open tomorrow. “It seems like you’re chasing this stock, but you’re not,” Guy says.
Amazing Amazon:
The headline: Unstoppable Amazon.com (AMZN) Soars on Plans to Boost Investment in China; AMZN is up More Than 60% Since It Released Q1 Earnings on April 24
The word: The shorts are getting massacred, Pete says. Amazon’s P/E is “ridiculously high” as the company now moves to China to expand. But exposure in China isn’t some sort of growth panacea for everyone. Jeff notes that other retailers like Starbucks (SBUX) and Wal-Mart (WMT) are in China, too. “Who cares? This is a bear-killing stock” he says.
The Cyclone Trade:
The headline: Category 5 Cyclone Threatens Crucial Energy Junction Strait of Hormuz
The word: Eric cautions that no one should underestimate how important this little strait is. A quarter of the world’s oil supply – about 20 million barrels per day – go through it and, even though the cyclone was downgraded today, the strait needs to be kept open “at any cost,” he says. Or else be prepared for oil to go much, much higher.
Block The Aisle:
The headline: FTC Plans to Block Whole Foods (WFMI) Acquisition of Wild Oats (OATS) on Antitrust Concerns
The word: Jeff doesn’t understand why the FTC wants to stand in the way of this, considering it only represents about $7 billion. For perspective, Kroger does about $70 billion in business, he says. Either way, Jeff would stay out of WFMI and OATS and stay long Kroger (KR) and Safeway (SWY).
Racking Up Big Gains:
The headline: Data Server Maker Rackable Systems (RACK) Surging Amid Unusual Options Activity
The word: Something is going on in RACK, Pete says, judging by the spike in options. This company may not be public in the not-too-distant future, he says.
Today Show Trade:
The headline: What’s the Trade on Castro and Cuba as Matt Lauer Broadcasts Live from Cuba?
The word: When Fidel Castro dies, Cuba will likely look to the Chinese-model of building itself back up, Eric says. He thinks Vulcan Materials (VMI) is well-positioned to take advantage of an infrastructure boom in a post-Castro Cuba.
WORD ON THE STREET
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Trader disclosure: On June 5, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (EMC), (ATVI), (SWY), Bolling Owns (NMX), Sugar Natural Gas Futures; Bolling Is Short S&P Futures; Bolling Is Short Nasdaq Futures; Najarian Owns (RACK), (OCPS), (ALVR)
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