And their reasons really got the desk talking.
Goldman took down their 2010 estimates due heightened concerns of Congressional resistance to do what is necessary in terms of fiscal stimulus, explains host Melissa Lee.
They also expect the jobless rate to rise to 10% in early 2011 and stay there for the rest of that year.
That forecast comes on the same day that the latest data from the Labor Department showed employment fell for a second straight month with the economy shedding 131,000 jobs.
How should you position now?
If we’re looking at higher unemployment then the retailers will remain undress pressure, says Patty Edwards. I’d start to pull off.
Also keep an eye on the staffing companies such as Manpower and Robert Half, says Pete Najarian. They’re trading at very high multiples but if they pull back I’d think about nibbling.
MARKET BUZZKILL: INDUSTRIALS, COMMODITY STOCKS
Our market buzz kill on Friday: industrials and commodities. Both took a hit on concerns that the recent run higher may have been generated by euphoria and not solid fundamentals.
What’s the trade?
Yes we’re seeing a pullback but we’ve had quite a run in this space, reminds Pete Najarian. I’m still bullish. I just think this trade is just pausing.
WHEAT PARES GAINS AFTER MONSTER WEEK
The traders are closely watching the action in wheat after Russia said it would temporarily halt grain exports.
As we told you on Thursday Prime Minister Vladimir Putin called for a ban on grain exports, with a spokesman later saying it would go into effect beginning August 15 and would apply to contracts that had been already signed.
However one day after the news hit the Street, the spot price of wheat traded lower?
What should you make of it?
We’re probably seeing some profit taking but I like the wheat story, says Joe Terranova. It speaks to demand from emerging markets. I’m a buyer of this story on a dip. I’m long Potash and Mosaic .
SAGA OF THE WEEK: RIM AND THE SAUDIS
Still no resolution to the stand-off between RIM and the Saudi government. RIM has been facing mounting pressure to open its super-secure network to government scrutiny.
A growing number of countries, especially in the Mideast, are demanding access to encrypted communications sent through RIM's BlackBerry device, saying national security may be at risk.
What’s the trade?
My clients are largely out of RIM and into other names in the space, says Steve Grasso.
I’m looking at Motorola , adds Patty Edwards. I don’t like RIM.
If you’re looking for a fast money trade it seems to me RIM has found short-term support near the low $50s, adds Pete Najarian. I know they’re losing market share and that’s a problem long term -- but short term I think the stock could pop.
CHART OF THE DAY: CISCO
It's may be make or break time for Cisco which is trading right around its 200-day moving average ahead of earnings Wednesday after the close.
What’s the trade?
I’m seeing a great deal of options activity in the 24-strike, says Pete Najarian. That suggests to me there’s upside in this stock.
In the space I’m watching Juniper , says Joe Terranova. I like this name on a dip.
I’ve been playing tech with Hewlett Packard, F5 and Akamai , says Patty Edwards.
PRICELINE – STOCK OF THE WEEK
Priceline shares surged this week, hitting 10-year highs, after the company’s latest earnings report led many investors to speculate that this online travel service is sitting squarely in an economic sweet spot.
They provide a quick and easy ways for price conscious travelers to book an inexpensive trip. And it appears that’s exactly what the public wants! The company reported a 71 percent surge in second-quarter net income as travelers booked more trips.
Specifically, the company said the strong performance was driven by growth in global hotel reservations, as hotel room nights booked rose 48 percent year-over-year.
International gross travel bookings increased 59 percent, due to rising travel demand and an improvement in room rates, and domestic bookings were up 20 percent, said Jeffery H. Boyd, Priceline's president and CEO.