Take a Load Off Fannie - Fast Money Recap (7/10/08)

Recap of CNBC's Fast Money, Thursday July 10.

 

Dow Out of Doldrums: Alcoa (AA)

The Dow rose along with general stocks on hopeful comments from Bernanke, a major deal for Dow Chemical, and Alcoa’s good news that the Chinese are going to cut aluminum production by 10%. Jeff Macke noted GM’s stock dropped after CEO Rick Wagoner’s comments that the company will not eliminate any more brands.

Take a Load Off Fannie: Fannie Mae (FNM), Freddie Mac (FRE)

Freddie and Fannie plunged on Bill Poole’s remarks that the companies are “insolvent.” “Stop talking trash about Freddie and Fannie, that’s not constructive.” Former Federal Reserve Governor Wayne Angell said on Fast Money. He said the answer instead was more constructive regulation and predicts the second half of the housing downturn won’t be much better than the first half.

Wow for Dow (DOW) Rohm & Hass (ROH), Eastman Chemical (EMN), Celanese (CE), Huntsman (HUN)

Dow’s announcement that it will acquire Rohm & Hass in a deal aided by Warren Buffet boosted commodities. The fact that Dow has decided to pay a 75% premium is a good indication that “corporate America sees value out there,” commented Guy Adami. Pete Najarian thinks Eastman or Celanese could be the next takeover targets, while Finerman likes Huntsman.

The Two Minute Surge: USO (USO)

In the last two minutes of trading oil jumped on supply threats due to Nigerian militants and news of a missile test in Iran. Macke, who is bullish on oil, particularly USO commented “Nigerian militants remain militant.”

Tech Rebounds: Cisco (CSCO), Intel (INTC)

Cisco and Intel recovered from earlier losses, and Najarian says in tech, he prefers wireless. Karen Finerman, however, prefers Intel and Cisco.

Retail in the Red: Wal-Mart (WMT), Target (TGT), Costco (COST)

Even though the retail sector reported better than expected numbers, led by Wal-Mart, many retailers went lower on feelings the stimulus check story is over and the back-to-school season will be tough. Finerman said she thought retail stocks were dealt with too harshly and likes Target. Macke says the only retail stocks he likes in the sector are Wal-Mart and Costco.

Wynn (WYNN) Some, Lose Some

In addition to announcing an aggressive buyback program, Wynn said its domestic earnings were down 70% while its revenue in Macau doubled. “Casino stocks are exactly the kind of stock that you have to be horrified about,” says Jeff Macke.

 New iPhone is a Giant: Apple (AAPL)

Just how big will be Apple’s new iPhone? "The iPhone is going to change the whole mobile world,” says Piper jaffray analyst Gene Munster on Fast Money. “Essentially this is mobile 2.0 This is mobile that we’re going to want to use. And it’s not in the stock.” Munster added the new phone will actually improve people’s lives and will move Apple’s share price enormously.

Priced In? Genentech (DNA), Celgene (CELG), Elan (ELN)

As has been said several times on Fast Money, biotech is safe haven in the volatile environment. DNA has performed very well, but the group was wondering if its success has been priced in ahead of earnings. CNBC’s Pharmaceuticals Reporter Mike Huckman says The Street is expecting $645 million in Avastin sales. Najarian thinks high expectations are already in DNA and he would look at Elan. Adami still likes Celgene.

Best of Breed: Corning (GLW)

Corning has moved beyond glassware and into making glass for flat panel TVs. According to Wal-Mart, sales of these large TVs are still strong and the market is expected to double in the next four years. Adami noted the stock has 58% market share and strong valuations.

Family Dollar  (FDO) CEO Howard Levine

Howard Levine was confident in his company’s ability to survive a tough retail environment, but analysts commented Family Dollar’s increase in June was a “one-time bump” caused by stimulus checks. Levine pointed out Family Dollar is the exclusive seller of the popular Bugle Boy Brand. The group was not bullish on Family Dollar, and Najarian doesn’t think Family Dollar can compete with Wal-Mart.

Final Trade: Macke: United States Oil ETF (USO), Najarian: Cisco (CSCO), Finerman: Big Lots (BIG), Adami: Alcoa (AA)

Seeking Alpha is not affiliated with CNBC, or Fast Money

Comments

[User 164588]

Fanny and Freddy with 200 over compensated bureaucrats as "over_sight" watch dogs ran up 10 trillion eigh hundred billion in debt for the dumb people in this country to pay off. Why do we think our government can solve our problems when their own house is in shambles? Anybody with a brain has seen this coming.

[AmesTiedeman]

The US housing sector will remain depressed for the next 10 years, not the next 10 months.

[User 164588]

Good post! Fanny Mae and Freddy Mac executives should go to prision for the 10 trillion dollar rip off of America....or what is left of it.


On Jul 12 10:41 AM Ames Tiedeman wrote:

> The US housing sector will remain depressed for the next 10 years,
> not the next 10 months.