WINNING STREAK CONTINUES:
The headline: Stocks Rise For Third Straight Day; Longest Winning Streak of 2008
It’s those old global themes of oil, retail and tech that added to the rally, Pete Najarian said.
But January’s rise in retail salesisn’t enough to make Jeff Macke a buyer of the retail space.
Guy Adami reiterated two of his favorite trades – Apache and Merck , the latter of which is just off its 52-week low.
MURDOCH TO FOIL MICROSOFT?
The headline:Yahoo (YHOO), News Corp. (NWS)Consider a Combination of Online Properties
News Corp. would reportedly take a 20% stake in Yahoo, which would likely help Yahoo fend off the hostile bid from Microsoft. But no one buys it. Karen Finerman, Pete Najarian and Jeff Macke – all Yahoo shareholders – voiced skepticism that the rumblings would ever materialize into a deal if for no other reason than that Yahoo shareholders would not let it happen. Pete said he continues to sell YHOO calls every month and take the gains.
CNBC’s Mike Huckman reported on a study just released in the New England Journal of Medicine that found that Rituxan, a joint-venture between Genentech
intended for use on rheumatoid arthritis and non-Hodgkin’s lymphoma, is also useful in treating M.S. According to the study, patients using Rituxan saw a 58% decrease in M.S. flare-ups and a 91% drop in brain legions after just two infusions of the drug.
This news has huge upside potential for Genetech, Huckman said. It could be a mixed bag for Biogen because the company makes two other multiple sclerosis drugs whose sales could be cannibalized by Rituxan.
But would that be the worse thing that could happen for Biogen? Pete Najarian thinks this solidifies his position that Biogen can be owned “from here to eternity.”
Jeff Macke said this could be a much-needed momentum push for Genentech.
TECH & TELECOM TRIUMPHANT:
The headline: Tech-Heavy Nasdaq Pops 2% as Intel (INTC), Cisco (CSC), Microsoft (MSFT) Surge
Guy Adami noted that semiconductor maker Applied Materials jumped 10% on its earnings as well. Tech was oversold, he said, and it’s time to look for the old tech stalwarts to come back.
Karen Finerman said that if she were building a tech portfolio, she would first look to Apple (AAPL) and Microsoft, which have the most value and are overshot to the downside.
FILL ‘ER UP:
The headline: Energy Stocks Fuel Rally After Report Shows Smaller-Than-Expected Oil Supplies
Oil Service stocks like Baker Hughes and Schlumberger also had big moves, Guy Adami pointed out. And the steel names were red-hot, too. Nucor and U.S. Steel are buys on their valuation and the chance that both could be takeover targets, according to Guy.
AG AWESOME AGAIN:
The headline: Ag Trade Making Fierce Comeback as Agrium (AGU) Reports Strong Earnings
Ag stocks can raise prices which not many other groups can do, Pete Najarian said. Their PE ratios may look high but it’s relative to their extreme growth rates.
Jeff Macke opined that it is just too hard to bet against these names anymore.
Guy Adami would buy Deere (DE) on any pullback.
CAN’T BEAT THE REAL THING:
The headline: Coca-Cola Profit Surges 79%, Boosted By Double-Digit Sales Growth In Emerging Markets
Coke is a play on emerging markets (it increased sales in India by 18% last quarter) as well as a weak U.S. dollar, according to Pete Najarian. But the fact that it didn’t increase its buyback is why the stock was lower Wednesday.
The headline: Solar-Power Stocks Surge After First Solar Reports Better-Than-Expected Earnings
Solar is the real deal, according to Pete Najarian. After soaring 30% on its earnings, First Solarlooks a little rich to Pete but the upside bodes well for the sector, he said. And don’t forget that semiconductor stocks like Applied Materials (AMAT) and MEMC Electronics (WFR) are also plays on solar since they make the wafers that go into the panels.