Investor appetite for risk fell on Monday, driving up the safe-haven appeal of the U.S. dollar as well as Treasurys. However gold which is also considered a safe-haven trade slipped on Monday -- in fact the precious metal hit its lowest level since mid-May.
How should you play it?
I would not buy commodities or related stocks on this pullback, counsels strategic investors Dennis Gartman, author of the Gartman Letter. Many commodities are breaking to new lows and that concerns me. I think that we could see as much as 3 weeks of downside movement.
In factm on Monday I sold out of my position in Potash, Alcoaand other commodities, says Gartman, because I think the game just changed.
THE SELL-OFF: BANKS HIT HARD
The financials took a hard hit on Monday with investors taking profits in Bank of America and other large banks after BAC revealed that two board members had resigned.
I’ve been saying it for a while but I still think JPMorgan is a short, counsels Guy Adami. In fact I think you can short many names in the space.
Goldman, JPMorgan and Morgan seem like best of breed to me, counters Joe Terranova. But I would stay away from Bank of America and Citigroup.
THE SELL-OFF: RIM, MICROSOFT LEAD TECH LOWER
On the Nasdaq , big-cap technology stocks led the index’s decline. Apple was a top drag even though it sold more than 1 million of the new and improved iPhones in the first three days of its launch, beating expectations.
For the year, however, tech is still the sector to beat. Take a look:
Tech Best Sector By Far This Year, Up 15%
Cons. Disc. +5%
Health Care -3%
Cons. Staples -4%
I think both RIM and Apple move lower from here, speculates Guy Adami, but we’re nearing levels where investors can get in.
I’m interested in RIM but I want the market to turnaround before I step back in, adds Joe Terranova. However, I do think Microsoft is a buy on this pullback.
In the space I’m concerned about Google, reveals Tim Seymour. It seems to me they’re facing a battle with China about filtering pornography.
TRADING THE GLOBE: RUSSIA ENTERS BEAR MARKET
It seems that Russia is now wrestling the bear. The Micex stock index in Moscow plunged on Monday making it’s total decline since June 1 about 22%. A drop of 20% or more is considered the threshold for a bear market, although wild volatility is nothing new in Russian stocks.
I don’t think the move lower is done yet, speculates Tim Seymour. But don’t forget they’ve also had a great run.
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Trader disclosure: On June 22nd, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Seymour Owns (BAC), (BX), (EEM), (FCX), (FITB); Finerman Owns (TBT); Finerman's Firm Owns (FL), (MSFT), (PBR), (RIG), (NOK), (TBT); Finerman's Firm Owns (WFC) Preferred, (BAC) Preferred; Finerman's Firm Is Short (BAC), (WFC), (IJR), (MDY), (IWM), (SPY), (USO); Finerman's Firm Owns (WMT); Finerman's Firm Is Short (XRT); Terranova Owns (SDS), (TER), (XBI), (BTU), (ABT), (MSFT), (HES), (BTU); Terranova Is Short (XOM) Call Spreads; Terranova Is Short (OIH) And (OIH) Puts; Terranova Is Short (RIG) And (RIG) Puts; Terranova Is Short (FCX) And Is Short (FCX) Puts; Terranova Is Short (IBM); Terranova Is Short (GENZ) Call Spreads; Terranova Owns (GENZ) And Is Short (GENZ) Calls; Terranova Owns (X) And Is Short (X) Calls; Terranova Owns (MS) And Is Short (MS) Calls; Terranova Owns (DIS) Call Spreads; Terranova Owns (BRCM) And Is Short (BRCM) Calls; Terranova Is Short (IBM) Calls; Terranova Owns (RIMM) And Is Short (RIMM) Calls; Terranova Is Short August Gold Futures; Terranova Is Short August Crude Oil Futures; Terranova Is Short September Crude Oil Futures; Terranova Is Short December 2009 Crude Oil Futures; Terranova Owns December 2009 Crude Oil Futures; Terranova Is Short December 2011 Crude Oil Futures
Gartman Owns (AA), (FCX), (BX), (SDS), (PBR), (SU), (GS), (L), (GS)
Gartman Is Short (ADM), (CVX), (BRK.b), (POT)
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