RECESSION FEARS SEND DOW DOWN 140
The headline: Philadelphia Fed Shows Lowest Manufacturing Activity Since 2001.
The Dowsaw a decline after new economic data seemed to raise concerns about a sharp economic slowdown and the possibility of recession, explains Dylan Ratigan. The Philly Fed indicated manufacturing was weaker than expected and the Conference Board reported the fourth consecutive decline in the leading economic indicators.
There’s probably more downside to come, says Tim Seymour. I don’t think this market has a lot of reasons to rally and valuations don’t look cheap if you think the second half of the year will be weak.
Technicals stink too, adds Jeff Macke. Wait for a bigger dip before you buy, he counsels.
I think there are some names that are working, says Guy Adami. I like the Cisco (CSCO) which was upgraded by UBS. Or look at Trinity Industries (TRN) and Western Digital (WDC).
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OIL GAUGE: OIL FALLS BELOW $100
The headline: Crude Oil Drops 1.5% To $98.23 After U.S. Supplies Rise More Than Expected.
Bulging oil inventories deflated energy shares on Thursday, explains Dylan Ratigan. News that U.S. oil stockpiles had climbed more than expected dragged down oil producer Chevron Corp (CVX), which joined the Dow industrials on Tuesday. Meanwhile the S&P energy index (.GSPE) fell 2.1 percent.
I like CVRD (RIO) says Tim Seymour for consolidation.
With the threat of recession looming I’m skeptical of the commodities sector, says Karen Finerman. But don’t short them, either.
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GOLD, PLATINUM HIT RECORD HIGHS
The headline: Gold, Platinum Soar To Record Highs As Dollar Weakens; Gold Closes At Record $949.20 After Climbing As High As $958.40.
Gold ended higher on Thursday in choppy trading that saw prices hit an historic high on a struggling dollar and supply worries, says Dylan Ratigan. Other precious metals also rose.
If you want to buy gold, buy the streetTRACKS Gold (GLD) counsels Guy Adami. Avoid the mining companies. Also, it looks to me like copper is poised to break out. In that space investors should play Freeport McMoRan (FCX), Adami says.
Check out ArcelorMittal (MT), adds Tim Seymour because they’re raising prices.
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ABOVE THE RIMM
The headline: Should You Hide Out in Tech Stocks Such as Research In Motion, Cisco?
Shares of Research in Motion (RIMM) rose almost 10 percent after the company lifted its fourth-quarter subscriber outlook to reflect strong Holiday sales of its popular BlackBerry smartphones.
Take gains on RIMM, says Jeff Macke. Or throw it under your bed for months.
I think it’s a value stock, says Guy Adami. When the nonsense ends it should go higher.
I like Apple (AAPL) at current levels, says Karen Finerman. And I’m watching Microsoft (MSFT).
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A PENNEY SAVED
The headline: J.C. Penney Shares Higher After Quarterly Profit Falls Less Than Expected.
J.C. Penney Co (JCP) reported a smaller-than-expected fall in quarterly profit on Thursday as the mid-tier department store operator offset falling sales with tight control on expenses. But the retailer, which caters to middle-income shoppers who are grappling with the slumping housing market and high energy costs, said there is no clear indication the consumer environment will improve in 2008.
I like JCP and Wal-Mart (WMT), says Karen Finerman.
If you want to make a basket of retailers, I recommend Wal-Mart (WMT), Home Dept (HD), and Mastercard (MA), says Guy Adami.
Look at Target (TGT) which I think is a better run retailer, says Jeff Macke. It slid Thursday on a downgrade.
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STARBUCKS: CUP OF PESSIMISM
The headline:Starbucks (SBUX) Drops After Announcing 600 Job Cuts; Starbucks Shares Now Below Level When Howard Schultz Returned As CEO in January
I like Starbucks right here and right now, says Jeff Macke. But be patient.
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THIS TRAIN IS BOUND FOR GLORY
The headline: American Railcar (ARII) Shares Surge On Better-Than-Expected Earnings.
Time to take profits in this stock, says Guy Adami.
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FAST MONEY WORLD: EUROPE STOCKS BETTER THAN U.S.?
The headline: Economic Data Today Suggests Europe May Be Better-Positioned Than U.S.
I think rates will stay at 4%, says Tim Seymour and continue to choke Europe.
On a related note, Seymour recommends the SPDR S&P Emerging Middle East & Africa ETF (GAF) for exposure to the Middle East.
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FADING GLOW?
The headline: Uranium One (UUU) Slashes 2008 Output Forecast By 32%.
