Fast Money Recap - Captain Kirk Beams out of Ford (12/29/08)

Recap of CNBC's Fast Money, Monday December 29.

Oil Rises, Stocks Fall: Target (TGT)

Stocks fell on oil’s 6% jump and Dow Chemical’s broken joint-venture with Kuwait. Joe Terranova said there was a testing of the 50-day moving average for the Dow and the S&P. Guy Adami would buy Target with a stop at $32. Pete Najarian says financials are flatlining because of uncertainty.

Dow (DOW) and Out

Kuwait canceled its $17.4 billion joint-venture with Dow Chemical because of the slow economy. Dow’s planned purchase of Rohm&Daas is now in doubt. Pete Najarian thinks Dow can be bought, but suggested trading the Feb 15 calls against the Feb 17 calls. “Didn’t we save Kuwait 20 years ago?” said Macke.

Slow Shopping Hits Real Estate: Simon Property Group (SPG), Acuity (AYI), General Growth Property (GGP)

With the slowest holiday retail season in years hit commercial real estate hard, especially Simon Property Group and General Growth Property. Guy Adami says the trade is to go downstream to Acuity group which makes lighting fixtures for malls. Adami would sell it short. Joe Terranova would buy REITs on a pullback while Najarian says he wouldn’t chase them. “Run away!” said Macke.

Oil Up on Mideast Conflict

Oil increased in price as Israel’s armed forces attacked Hamas in Gaza. “We need to get the contango out of the marketplace before oil can make a sustained rally,” said Joe Terranova. Najarian would look at Freeport McMoRan, but warned it is volatile and mentioned there is a premium on the options. Macke would stay away from commodities because he thinks they can go a lot lower.

Captain Kirk Beams Out of Ford (F)

Kirk Kerkorian sold his remaining stake in Ford after his company, Tracinda, had been the largest outside shareholder. Guy Adami said he thinks GM is headed for zero but he isn’t sure about Ford, which seems to have hit bottom for the short-term.

Alert on Linn (LINE)

Pete Najarian is seeing more options activity in Linn and adds that January 15 calls indicate the stock could rise.

David Kelly is Optimistic

With declines in the Dow and the S&P, is it time to buy? David Kelly, chief market strategist at JPMorgan Funds says he is optimistic, and sees an expansion mid-year; "We’re an economy of long expansions and short recessions. If you follow history eventually the economy will come back. People tend to forget that.” He says buy and hold should be a winning strategy.

2008: The Year of the Fed

2008 may well be remembered as “The Year of the Fed” because of the unprecedented amount of funds devoted to assist banks, the cutting of interest rates close to zero and its pledge to buy up government-backed mortgage bonds. Are the Fed’s bold moves a cause for worry? Former Federal Reserve governor Lyle Gramley doesn’t think so; the immediate concern is deflation, not inflation. He added the Fed should do anything it can to spark a recovery, and if the balance sheet is expanded now, it can be reduced later. “The Fed is going in the right direction,” said Gramley.

What Will 2008 Look Like? General Motors (GM), Exxon Mobil (XOM), Schlumberger (SLB), Freeport McMoRan (FCX), Chesapeake Energy (CHK)

Will 2009 see a turnaround? Perhaps, but not right away. The bridge loan for General Motors will last only until March, housing isn’t expected to recover at least until June, and may not be until 2010 that Obama’s stimulus plan will make an impact on the GDP. Joe Terranova thinks energy and natural resource stocks will be strong in a few years and Africa might be a viable market. Terranova likes Exxon, Schlumberger and Freeport; “There still is a fundamental story underneath all these names of how you grow future supplies. But again these stocks are a longer term story.” He would begin a long position over the next year to year and a half. Adami thinks natural gas stocks such as Chesapeake will see an upside in the coming years.

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Comments

[jimmy46:]

Kirk Kerkorian sold his remaining stake in Ford after his company,""""

That probably has as much to do with get a tax loss for the year as anything else.

2008 Dec 30 02:17 PM

[mike40:]

Why comments from Monday on Wednesday? Why not do this in a more timely manner?

2008 Dec 31 10:22 AM

[mike40:]

Why comments from Monday on Wednesday? Why not do this in a more timely manner?

2008 Dec 31 10:23 AM