tv Fast Money CNBC February 12, 2016 5:00pm-5:31pm EST
it there. mike, thanks for joining us after an extra long day today. thank you. have a lovely long weekend. >> my day wasn't as long as mike's. >> go to lots of book stores and tell us all about it. thank you so much evan. that does it for us on be "closing bell." up next "fast money." tim seymour, steve grasso david seeberg and guy adami. tonight on "fast" oil surging seeing its best day in more than stefan years closing above $29 a barrel and one well-known energy experts says do not buy the hype just yet and he'll tell us what he sees as the next real test for oil. plus be a undercover tech standout. despite this week's volatile swings it's the one fang stock that manages to pack a major bite. does this countertrend move mean it's time to buy? we've got a few retail reports next week that could send the consumer trend tumbling.
we'll explain. first starting off with the markets, what else stock market closing at the highs capping an end to an extremely extremely rocky week. the dow soaring 350 points seeing its second best day of 2016, crude oil staged a massive rally along were big rebounds in the banks but the rallies failed to turn the major indices positive. we sit back here on friday and say what the heck happened guy adam? >> what the heck happened. >> yeah. >> i'll tell you what the heck happened. yesterday you had a couple of good things happen. at 2:30 you had the uae headline. stop the s&p on a dime at 1810. steve and i have been the 1780 camp. maybe close number one. after market jamie dimon, all love jamie dimon, he announces he's buying jpmorgan stock. geffen they're critically the all clear for banks and then the deutsche bank headline overnight. >> right. >> those three things confluence of events long weekend. >> does that address the major concerns in. >> i'm not saying that i knew the market was around but what
we did say yesterday, whatever starts today, whatever that initial move is don't fade t.marbling it open on the lows of the day and close on the highs. >> i do israel. >> that's power going into a weekend, especially when people are like the chinese will come back from their holiday and it's a case where it's back to business and back to fearmongering, but the things we talked about yesterday, i thought dan nathan made an interesting point and challenged me on the negative feedback. that implies that it's not real and what you have here in the case of oil, nothing happened at all, and in fact the sentiment is so bearish you're in a case here where even the prospect of an opec cut, it was the journal article that did that. i don't think anybody has varified this so the fact within opec and russia they have blinked, and i think that's enough to tell people that at some point the supply pullback could be a big part of it. same thing with the banks. it doesn't really change anything that deutsche bank bought distressed bonds but they at least are sending the message we've got plenty of fire power.
i said a couple of days ago when larry is on. this is effectively the state bank of germany. they have as much firepower as they need and can do what they need and market conditions are so oversold very positive. >> what everyone is saying a couple of things have to happen. you need to have oil stabilize. i don't think one day off is going to do that for us. you need to have the banks stabilize. i don't think a one day off is going to do that for us. but we ear also saying that we can balance. if you look at the level 1863 that's the level i had said at the -- what do we call it smart board. >> smart board. >> at the simard board, i guess not that smart. >> well, i don't know. >> if you're wearing a sweater apparently not. >> 1863 is the level to watch, close one handle above that so i do think obviously we have a three-day weekend. i want to see china get back online and a couple things happen you need oil to stabilize the market and one day does not make a trend. >> here's the way i look at it.
it was de-risking essentially a little bit of good news shows you exactly how clients are positions or how institutions are positions, total de-risking ahead of a long weekend. >> de-risking meaning taking off negative speculation. >> you're short equities and short oil, short let's say equities and oil, you're covering. it's in absolute reversal of every team we've seen as far as positioning and that's how you have to look at the market right now. look at it and if you're trading short term bring themes into that and create a longer term struck tour. >> don't fade this bounce that we saw today on tuesday, what's your inclination for the market? >> i think -- well it's -- that's a good question because -- >> it's a long ways off. >> and it's a long weekend. >> long weekend. >> historically a tough foim for volatility. >> i'll say this. if you somehow get positive news out of asia if the european banks stabilize and firm up again you'll see the s&p get
back to the levels we have talked about, 1920 to 1940. >> huge ifs. >> 1940 is the upper end of the region and i think on the downside we break through these levels, 1820 level, 1780 is a foregone conclusion. >> a key ingredient to today's rally oil. saw its best day, rebounding from a 13-year low. our next guest says do not buy the hype. the worst is definitely not over for the crude trade. we'll welcome tom kloza of the oil pricing industry. tom, always great to get your perspective. >> hi, it's an interesting day and we were down on the week for oil. >> it's melissa, by the way. the worst is not over tom, then where do we go? >> well the next 45 days are really challenging for crude because in addition to all the refinery maintenance that is normally schedule you had a situation where refiners were running crude oil for let's say
$28 or $30 and selling gasoline for $20 to $25 a barrel. they are cutting back. we're actually going to see less demand for crude oil in the united states over the next few weeks or so, so i think that we haven't necessarily seen the lows. i think there's a lot of pressure that's going to be brought to bear and the report about the united arab emirates they are probably the lesser member of the troika. it's the saudis and kuwait. kuwait announced earlier this week that they were going to increase production by 150 n.o.w. barrels a day by the third quarter so it still looks colleague for the next few months. >> that's it. it's all about timing and i'm not sure that a lot of people on this desk i should say, at least our audience are looking to time the market perfectly. i know it's turnaround season for refiners and saudis certainly, their whole market share experiment is far from over. they want to see what iran's capability, is but can't you say we are getting very close and if
it's very close. i'm not going to ask you to invest in oil stocks but to say that things are going to be so depressing the next couple of weeks. it's been depressing for the last year and a half. the prospect i think spring is going to be a lot better and ultimately you have the dynamics that in the short term will change very quickly. >> well, i mean, you're making the case for how far ahead do you look. >> and i'm saying fundamentally the next 40 days look very, very ugly for crude oil for the u.s. and abroad. after that i think it looks a lot better. if you're a refiner you probably saw the turn this week. i think gasoline prices in the united states have probably bottomed. at 169.9 we saw overnight. that may be it for the first eight months of the year so yeah, i think it gets better in the second quarter. people will be using a little bit more fuel. if you don't have a breakdown or attrition in the emerging markets, you get a demand kick of about $1.2 million barrels a day or more owe it gets better and i agree with the prognosis that 2017 and '18 are higher
prices, but, boy, it's hard to see light at the end of the tunnel for cruise. we did see light at the end of the tunnel for the gasoline market. >> but the bottom line here is tom we make another run for 21 to 26? >> i think the big technical numbers people are looking at are between 22 and the previous lows hit earlier in the week. again, wti is much much more pressured than brent because the cutbacks we've seen in refining are u.s.-based so once we get through that and we get into the second quarter i think that things improve and don't be surprised to see the price of gasoline on a per barrel basis trade for twice the price of crude oil somewhere in the next 60 days. >> tom, thanks for phoning in. have a great weekend. >> take care. >> tom kloza. if the next 40 days will be rough and we make that run to 21, does that necessarily mean that stocks move along with crude? >> if the bottom falls out of crude, a couple of things happen when we open up the show.
you saw crude tick higher and the banks tick higher people put their money to equities and crude comes back in it will break 1784 the next level to look. already cracked the recent low in crude. i think that goes lower and i do believe the rest of the market goes lower as 12 i'll say something else i said on the show before. $50 is your top in crude. it will never trade there again. >> i think closer to the 40 you get you keep laying it out because that's where the hedging will really start to begin. once we get to 40 bucks, if we get to 40 bucks, i think you'll continue to see massive, massive production in the u.s. i look at it and say it's very simple. i can't imagine buying an equity right now unless it's for a very short term period. >> an oil equity. >> oil equity the lower quality guys have to be burged. there's obviously positioning going on there, but they need to seat bankruptcies which have to occur before you can step in and feel comfortable. even though there's a lot of money on the sidelines, a lot of big institutions that want back in this space. they will not do it unless
there's absolute comfort. they can't explain to their investors why. >> if i have a six month horizon does it change? >> it does. >> steve saying they are never getting back above 50. >> i did replay it a couple of times when i said never. >> trying to figure out the direction. >> i will say for an extended period of time because as we're looking at this now all the producers become more efficient at what they do so their break evens become lower. you've had advances in drilling alternatives come on so you have a bunch of countries that are never going to stop producing, and they are banging everyone. >> meanwhile -- >> hold on. i -- >> doesn't realize you need investment in oil, it's going to stop flowing. >> i need an answer though. short show. if you don't agree with six in the next six months you think oil equities could be a buy, which ones? >> i think they are a buy now. >> okay, fine. integrated where? >> oxy, apc, exxon, bp you got it. >> real quick. on this note the ovx, oil
volatility index closed over 80 and closed up 1.5% and not necessarily giving you the all clear. >> a blue chip beat-down and a fang stock bucking the trend. we'll give you the names and trades next. retail's moment of truth from bellwether walmart to department store nordstrom. two key retailers on deck to report earnings. whether they are worth a buy ahead. results and later, don't look now. jpmorgan is having its best day in more than five years but one of are our traders says look out below. he'll explain why he's getting short right now. much more "fast money" right after this.
welcome back to "fast money" money." a crazy week in the market led to some wild moves for stock. the biggest moves of the week in a special edition of top trades. netflix bucking the trend, shares up nearly 6% this week. guy? >> kudos to tim. 95 was the line in the stand. i think mark cuban just talked about buying puts against this netflix position. yes, it had a good week. in my opinion only had a good week only because we were so oversold. got to be true to my word. love the story, but in my opinion to trade it it's got to recapture 95. we're still about 10%, 11% away from that. got to wait for it to get back
there, hold it and maybe we is can have the next leg higher. >> where do you stand on it? >> i like the stock long term. you know where i stand from that perfective. near term have to wait for them to perform sub numbers. people want to see where it comes out. wait for them to report and see how the number looks and how the guidance looks and move forward. >> there's questions about international intervention as an engine of growth. >> u.s. is already saturated and if you think that these guys can have the same cultural impact in other places. i get developed europe maybe possibly but to think it's already not happening in japan, going to not happen in china or not happen in india, the stock, multiple-wise that's what this market cares about. do not chase this stock. >> what's the multiple for it? >> first of all, should trade a like a cable company. >> if it earned 7 bucks in 2017. >> 20 times. >> i get how it applies, but it sort of doesn't apply because a southern sector.
market where there is not a comparable and it will never apply. >> as they start having money and having earnings come in. the margins will shift and the spending will be cut down dramatically. >> it should be. >> look at 7 bucks, probably an easy do. >> first of all, had a great call on this and alsogrowth. you nailed that as well and the way they exploded. that was a shock. >> yeah. >> when they exploded. >> good good call up or down? >> he's been all over it. had a good call on the way up with international growth and a good call saying it was petering out and momentum was failing. >> come on, tim. >> here's the thing all over the place. >> international growth where everyone thought they would come out in four different countries and blew it out of the water. i think people -- nobody saw that coming. so i think that still shocked the market but if we're in an environment where momo is not paid momo and you don't have a multiple on it then you have a problem. >> solar city getting crushed the past five days. huge declines came after a q4
weak guidance in the first quarter. >> a couple of downgrades and outperforms still on the street. higher costs and operating costs spread between deployments and ultimately where the actual projects are coming out. one thing i think you can take solace at if you believe these guys continue to finance themselves, they trade at asset levels, one time their asset levels so make an argument there should be a floor underneath the stock but a lot of people believe none of these guys can finance themselves in the new market environment. i think it's challenging. i think the stock is a no-touch but i don't think it's going out of business and probably getting very interesting price-wise. >> yeah. you know there was -- it was once viewed that the expiration. investment tax credit would shake out some of the weak players in the industry. with the extension you're allowing the other players to just to sort of continue existence and that's not necessarily a good thing for the market. >> some powers have a better business model and that gets thrown in with everybody else. up 4% had tomorrow western on a
number of times and that's the great place to be. a great call for a while and been a louis call but at 29.50, i heard what tim said about solarcity, rather be in solar power. >> boeing falls 12% this week. grasso grasso? >> concerns about pricing or repricing but if you look at the stock longer term there's no fighting. it goes from in dennis gartman's words lower left upper right and i've been a long investor since the middle '80s in this up. if we're in a slow global growth environment this one is going to be challenged. the balance zone is right around par. $100 in the name. >> i agree. >> we came out and defended the stock pretty aggressively on the pullback. our analyst has been covering the stock for like 40 years and his thought is essentially, you know the s.e.c. investigation is the bottom of the list as far as his concern. pretty decent level, like this company long term and wouldn't be too concerned over that. i'd be a buyer.
>> i don't understand why you wouldn't be concerned into any s.e.c. investigation into any company when it comes to a major program like the 747. >> seems like the level of communication has been different for this company over the last two or three months so you know, it gets to this place. when times are good things seem to be -- >> meaning they should be talking to investors more. >> or maybe they should not be talking to investors as much all the time. i don't know. clearly it's inconsistent and that's troubling for a company like that. >> very inconsistent when you take into consideration over the summer, i think it was a delta ceo, correct me if i'm wrong said something about peak demand for airliners, correct. boeing came out and said wrong, wrong, wrong. then they came out and talked about their cargo planes. they cut that down, and then they reported a quarter and then they sort of gave -- it's been a number of things this being the last so you have to -- at a certain point you need to take the credibility into question so i think it's got to recapture 120. i don't see it happening any time soon up. >> next, china is officially open for business next weekend and it could have major
implications for the markets. first trades for tuesday right after this. i'm melissa lee, and you're watching "fast money" on cnbc first in business worldwide. meantime, here what else is coming up on "fast." >> coming up it's been a bright spot in the markets. retail, but with walmart and nordstroms still set to report is the consumer still spending? it's the ultimate test and we'll tell you what to expect. plus why one laggard of a leading sector is about to break out. the name and you can make money. all that and more ahead this hour. hey, jesse. who are you? i'm vern, the orange money retirement rabbit from voya. vern from voya? yep, vern from voya. why are you orange? that's a little weird. really? that's the weird part in this scenario?
welcome back to "fast money." we'll get our first taste of how retailers performed this quarter when walmart and nordstrom report on tuesday. take your position ahead of next week's earnings. walmart has been a standout this year? >> stay with walmart because i think the bar is extremely low. these guys in the last quarter, almost two quarters have started to show a reversal of what was a terrible trend in terms of same-store sales. management is starting to focus on competitive advantage which is price so if i had to choose one or the other, nordstroms has had a pretty decent run off the floor, very very cheap. probably very overdone but walmart is the sustainable in this environment. valuation certainly works. >> look, i'll give you my
long-term is walmart and next week a trading opportunity in jwn. i think they will report and numbers will struggle. they will guide down. the stock will get hurt on the earnings report. that's when you buy it for a short-term pop. >> grasso? >> look at wall markets the chart is much more constructive than if you look at jwn. look for it to trade and close above 67.75, the 200-day moving average. jwn, 50/50.50 that's the 50-day moving average. >> macy's is interesting. struggled with $40 a couple of days and ever since they gave disastrous comps it's traded remarkably well in what's been a lousy tape. macy's is cheap on valuation and the news flow behind them in terms of the bad news. i think you can own macy's and visa and square announcement was pretty interesting. yeah. square's got issues quickly and now you have visa up big, sq. i think there's a trade to be
had on the long side in square. yeah, you can knock it on valuation on a number of different metrics, but with visa now in this boat, i think for trade you can own the stock. >> i noticed today a lot of these stocks have not recovered when they raised the minimum wage. if you look at walmart, that was the line in the sand for walmart. that was the peak in the stock price. it was december and then january 1st, 2015 and you've never seen it regain. i wonder what a burden that's been for a lot of these names. >> look. i mean i hate to be pandering to the masses but for walmart's case it should be a burden. these people have been underpaying people for a long time and it's a case where you've got a company >> what does it do with the stock, does the stock recover? >> it's in the stock price the same way as it is in mcdonald's and all the others. >> what does it mean as far as profits and spending and whether or not the consumer that's shopping hat walmart is making more money is going to spend
money there. >> this stock went from the $90, has never recovered. this was the month where if you look at it on a chart it's clear as day. january -- >> it's recovered. >> recovered what? >> 57 to 65 bucks. >> i'm talking about $90 when the minimum wage was raised. >> okay. >> when they raised it the stock was $66. >> are you saying they are not investable at this point or at a certain point we move past that. >> it's had such a appropriate to us drop i don't know if it can ever get back that level pre the minimum wage raise. >> final trade? >> 29 is your buy on eem to 31 that's the range, 29-31. >> steve? >> disney still in it been all over and watching it like a hawk. had to buy it back when it traded above 10. still in the name still try. >> siebert. >> american airlines looking to buy it here and i think the stock will work near term. >> guy? >> whole food markets, wfn. >> have a great long weekend. do not move.
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hey there. bad news it's freezing outside and good news stocks actually rallied today. these guys are make sense of it all. while they are doing that here's what's coming up. >> i'm, shocked. >> that's what wall street is saying about the huge move in oil today, and we'll tell you why we may have just witnessed a bottom. plus -- ♪ coke and a smile ♪ ♪ makes me feel good ♪ >> and the charts will make you feel even better. we'll explain why coke could be on the verge of a major breakout. and market it your toil this week had traders running for cover in safe haven assets but could these trades be a little overdone. we'll tell you how to protect yourself from the crowded