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Pure Plays For a Weak US Dollar

The major US indicies were all up around 2% on Monday, following word that the G-20 would continue their stimulus policies, commodities stocks surged and the Dow hit a new 2009 high as the US dollar fell to a 15-month low.

Word on the Street

With the Dow closing at its highest level since October 2008, Gold reached another record high, as oil also jumped 3% to the upside on the best 3 day gain for stocks since July 15-17.

Word on the Street

Although the Dow has reached it's 2009 high, its current level is somewhat similar to where it was several weeks ago, but what does this tell you about the market's future? Joe Terranova sees this as an upward sign from the market, after investors have successfully "fought through" barriers to gain widespread positive momentum. He sees the S&P 500 heading over 1,100 this week, and has identified a trade on these numbers. With earnings season and market-moving economic reports mostly behind us, it's time to think like a money manager, he says. There are underperforming money managers out there who need to buy right now, he says, and with this knowledge, you need to be looking at the "best in breed" names, following their lead.

Tim Seymour agrees, saying that he believes the biggest and most high-quality names are the ones set to rally, with money flowing into these stocks and staying there for the long term. He is also bullish on the S&P, which he points out has a 95% reverse-correlation to the dollar, in which he sees continued weakness.

"The race for performance is there" adds Pete Najarian, who notes that the Fast Money desk has been discussing since September that money managers would be highly motivated to buy prior to the year's end. He points out the trend of buying on Mondays, as mutual funds and other managed assets utilize the cash reserves from the week prior during Monday's trading session. This example demonstrates how influential these large positions really can be, a "Mutual Fund Monday" pattern, he says.


Topping The Tape: Commodities Surge on Weak Dollar

Pushing the rally were the big commodity names, after Gold reached a new all-time high and Oil surged 3%. Freeport-McMoran , Chesapeake Energy and Deere all experienced near-3% pops, as cash looks to flow towards blue chip names.

Joe Terranova revisits his earlier strategy of 'thinking like a money manager': trading equities instead of futures in an attempt to lock in profits before the end of the year. Instead of being long the commodities, be long the companies that deal in commodities, Terranova says. Instead of going long in gold, buy Freeport-McMoran... in terms of energy, they're going to look at the oil service names, the OIH will be popular, Transocean will be popular and Suncor will be popular, Terranova suggests.

Tim Seymour agrees with Terranova's thesis, but also points to the agricultural names which he sees as lagging the rally in commodities, such as Potash and Mosaic . Grain prices have rallied recently, and fertilizer prices will soon follow, he reasons.

Pete Najarian also sees the machinery space outperforming the market for the rest of the year, citing Joy Global , Caterpillar and Bucyrus showing strength. For these names, he sees the biggest opportunities surfacing on pullbacks.

However, Karen Finerman isn't so bullish on the oil service names, trimming her positions in companies like Transocean and Pride , seeing the recent rally as a profit-taking opportunity. Joe Terranova suggests another way to play energy, indirectly through natural gas. Companies like Apache , EOG Resources that have exposure to natural gas are stocks to watch, he says. He also doesn't expect Hurricane Ida to have much impact on oil futures moving forward, it's all about the dollar he says.

Pete Najarian also suggests BP, which he has identified as a cheap stock compared with others in the industry. Joe Terranova also suggests a different way to play the US dollar, through the pure-play, commodity-currency ETFs: the Australian currency ETF and Canadian currency ETF, which he says are "great plays" on the dollar.


McDonald's Leads Consumer Shares

As the market prepares for a slate of retail earnings over the next few trading sessions, McDonald's same store sales growth has been encouraging for the sector, showing the possibility that it could be the next breakout group of stocks and catalyst for the market to the upside.

Karen Finerman likes Macy's ahead of earnings, although she isn't as confident in Abercrombie and Fitch suggesting people stay away from it. Pete Najarian agrees that ANF might be a little rich at the moment, but also highlights Nordstroms , which had a big move since Friday's trading session, with traders already taking profits on the stock. One name Najarian specifically likes is McDonalds, which is showing "incredible performance" globally. Tim Seymour doesn't fully agree, because although he sees high growth potential, he fears that the stock is somewhat overbought.

Bull Market or BS?


Seymour's thesis may hold water for the retailers in general, as recent data shows that industry insiders have been disproportionately selling their shares, at a rate of about 15 million shares compared to 2 million shares in August. What gives? Joe Terranova doesn't see this as a major problem, however, as he sees pent-up demand from the American consumer unleashing itself before the year's end, with the major beneficiary being the country's retailers.

For more in-depth analysis of this topic, and also to get Dennis Gartman's analysis of how the weakness of the dollar will impact the stock market his picks and important trends to follow, check out the video!

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Trader disclosure: On November 9th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Najarian Owns (BP) Calls, (FCX) Put Spread, (RIMM) Call Spreads, (UUP) Calls, (YHOO), (YHOO) Puts; Finerman's Firm Is Short (IJR), Short (MDY), Short (SPY), Short (IWM), Short (USO), Short (UNG), Owns (CBY), Short (KFT), Owns (MSFT), Owns (PM), Owns (TGT),Short (UNG), Short (USO), Finerman's Firm And Finerman Own (WFC) Preferred, Finerman's Firm Owns (WMT), Owns (YUM); Terranova Owns (GS), (WYNN), (JPM), (SU), (MRVL), (BRCM), (GOOG), (RIMM), (AAPL), VIX Nov. 24 Puts, Terranova Works For (VRTS); Seymour Owns (AAPL), (EEM), (F), (FXI), (TM), (VIP), (POT), Najarian Owns (INTC), (INTC) Calls, Finerman's Firm And Finerman Own (RIG), Finerman's Firm And Finerman Own (PDE), Finerman's Firm Owns (M)
Najarian Owns (JWN) Calls, Finerman's Firm Owns (BAC) Preferred, (BAC), (BAC) Call Spreads
Finerman Owns (BAC) Preferred, (BAC), Najarian Owns (BX) Calls

Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.

Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of  (DLR)
Virtus Investment Partners Owns More Than 1% Of  (EXR)
Virtus Investment Partners Owns More Than 1% Of  (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBC)
Virtus Investment Partners Owns More Than 1% Of  (DBV)
Virtus Investment Partners Owns More Than 1% Of  (UA)

DENNIS GARTMAN Funds Managed By Dennis Gartman Own (EWZ)Funds Managed By Dennis Gartman Own (EWA)Funds Managed By Dennis Gartman Own (EWC)Funds Managed By Dennis Gartman Own (EWZ)Funds Managed By Dennis Gartman Are Short U.S. DollarFunds Managed By Dennis Gartman Own Gold In U.S. Dollar Terms, British Pound Sterling Terms, Euro Terms TAVIS MCCOURT ***NO DISCLOSURES ON AAPL, MOT, PALM, RIMM BRIAN KELLY Kelly And Kanundrum Capital Own (UUP)Kelly And Kanundrum Capital Own (USO)Kelly And Kanundrum Capital Own (TDW) ***NO DISCLOSURES ON CRUDE OIL, U.S. DOLLAR, GOLD with wires