Recap of CNBC's Fast Money, Friday April 11. Click on a stock ticker for more analysis.
General Electric (NYSE:GE), Honeywell (HON, Siemens (SI)
General Electric’s poor earnings sent shockwaves through the market, and Jon Najarian commented “not even Nostradamus” could have predicted a poor report for GE and added the company has to earn back The Street’s trust. Jeff Macke was disappointed GE blamed the last two weeks in March for an uncharacteristically bad performance and Guy Adami said infrastructure and overseas businesses were strong, but the medical devices segment was shocking, and GE’s news doesn’t bode well for Siemens. Adami added he would have been bullish on HON if GE’s quarter had been good. Tim Seymour noted that stocks not levered to GE traded with sparse volume and attributes that to a “wait and see” attitude.
Oil and Commodities: Halliburton (NYSE:HAL), Schlumberger (NYSE:SLB), Baker Hughes (NYSE:BHI), U.S. Oil Fund (NYSEARCA:USO), StreetTracks Gold (NYSEARCA:GLD), Freeport-McMoRan (NYSE:FCX) and Southern Copper (PCU).
For the third consecutive week, oil rose and this time reached $112. Seymour noted the International Energy Agency, which usually says more oil is needed in the market, cut its demand forecast for the third month in a row. Adami says oil is high, but continues to be bullish on HAL and SLB. Jon Najarian agreed with Adami about SLB and added BHI to the list. Macke revisited his recommendation that investors sell off half their positions once oil reached $110. He doesn’t think oil will break out and thinks it will drop back down to $100. While Macke would not buy refiners, he likes oil ETF USO and Gold ETF GLD on a decline. Seymour is bullish on copper and would buy FCX and PCU.
Wal-Mart has performed well this year and Macke said it isn’t too late to buy the stock. Adami also noted HD’s strong showing.
The following week features many earnings calls for the tech sector and the group asked Gene Munster if it was worth buying tech this spring. In spite of the risk, he would buy GOOG ahead of earnings. Jon Najarian and Adami would pick up GOOG after earnings, because they expect a decline. Adami prefers Intel to Google. Najarian noted volatility in IBM and is concerned about its tie to the financial sector, and expects the stock to dip below $110. Adami observed IBM has risen to about 17% lately and would take profits if earnings news is good and buy later if the numbers are strong.
CNBC on-air editor Charlie Gasparino discussed MER’s claim that it does not have liquidity problems, and said it is unlikely CEO John Thain would be dishonest about the company’s balance sheet. He recalls that when Thain became chief he urged traders to raise cash by selling bonds and thinks Thain will sell part of the company. The group discussed their favorite and least favorite financial services stocks. Macke liked MS Adami chose USB and Seymour picked Merrill and the three disliked LEH the most. Najarian likes JPM but dislikes WB.
Volatility and the Week Ahead with Microsoft (NASDAQ:MSFT)
Najarian predicted the volatility index would reach the mid-20s in the coming week, and will dip back to 20 unless a company goes bankrupt. He would short premium going into earnings. Seymour thinks the index would rise above the mid-20s and is selling puts into earnings. Macke would be a buyer because he’s noticed selloffs are being sparked by news reports. He would consider Intel, Wal-Mart and Microsoft on declines.
Trader Radar: Delta Airlines DAL traded on unusual volume.
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