Strategy Session with the Fast Money Traders
Transports were down on Tuesday, explains Guy Adami. They’re now down two-days in a row and I can’t dismiss that. As a Dow theorist I think stocks go lower.
It seems to me the third quarter won’t be nearly as easy as the second quarter, adds Joe Terranova. During the next three months investors will have to be nimble.
I’m mildly optimistic going forward, says Karen Finerman, but it seems to me the market has been wildly optimistic. I really want to see what the financial firms have to say when they report earnings in July before I can get terribly excited.
BANKS: BAD DAY
Investors took profits in the sector that ended as the quarter’s best performer. Financials finished the day lower lower with JPMorgan and Goldman Sachs both in negative territory.
In the space, I’m keeping an eye on Goldman , says Guy Adami. Although I think they report a strong quarter I would not own this stock at these levels. Instead I’d wait for a pullback into the $130’s. Same thing for Jeffreies , he adds. I’d wait for a pullback to $18.50.
I think Goldman Sachs will report earnings that are staggering, says Pete Najarian defiantly. I’m bullish on Goldman as well as Morgan Stanley and JPMorgan.
And another name that has outperformed this quarter is Blackstone , he adds. Around $10 I think it’s an interesting stock.
OIL: GREAT QUARTER, BAD DAY
Oil finished the quarter up a whopping 41% making it the best 3-month period for crude since 1990.
What’s the oil trade?
An overnight reversal in crude made me a little bearish, explains Joe Terranova. However I think the trade is flat – not short. If you’re looking for a long trade, I’d look at the integrated names which have seemed to lag.
If the OIH trades down to $90, I think it’s a buying opportunity, adds Guy Adami. And if you’re an aggressive trader I think it’s okay to short crude.
I’m short the USO, reveals Karen Finerman but not as a bet on lower crude prices — rather as a hedge to my oilfield services exposure.
OTHER ASSET CLASSES
With the dollar and Treasurys making headlines over the last 3 months, how should you play them going forward?
I think it’s still a smart bet to expect inflation, says Karen Finerman. I’d be long the TBT .
Quite frankly it wouldn’t surprise me to see a spike in the dollar, adds Guy Adami, if for no other reason than nobody expects it.
THIRD QUARTER OUTLOOK
Considering the S&P ended the quarter about 15% higher, how should you position yourself going forward. For insights we turned to strategic investor Dennis Gartman, author of The Gartman Letter.
Gartman’s Ways To Play
Stay Out Of Gold