Portfolio because the most popular and widely owned stocks in america are getting pummeled. Were talking about amazon, facebook, google, apple, all losing ground again today after a red week. Last week those stocks have shed a combined 132 billion in market cap since the election. So at what point do these names become a buy or are they simply a notouch right now. Guy . Steve talked about this the last week, week and a half, about the great rotation and youre obviously seeing it now. When amazon reported, we talked about the potential to trade down to 700. If you looked at the end of last year it traded up to 700 a number of times before breaking lower at the beginning of 2016, so past resistance becomes support. Youre going to find now traded down at 710 today. I thought that was going to correlate with an s p trading down to 2025, and we did see that the night of the election. Here we are within a whisper of an alltime high. To me amazon out of all the ones that have flushed might be the most interesting to trade on the long side. And you have continued to buy tech . I have continued to buy those that i own, google and facebook. Today bought some more google. Now full on google so i hope the opportunity is now over. But i think that i know i understand completely the rotation sentiment is not here, its a reversion to the mean. All of that having been said, on google first, google is not expensive here and its still a Great Company and its still growing. All of the things that benefit the market, better tax structure, potential repatriation of money, all of those are still positive for google and its a great business. Could it trade lower . Of course it could, but i think buying it here, as i did friday, as i did thursday, ultimately will work out fine. When you back out the cash now, the multiples, sub20 pe. These stocks, facebook, google, amazon is a layup here. If you look at it over the past eight years and youre talking a little bit about this downstairstheyre before ebitda multiple is 12 to 25. Its trading below 15. So you look at this company and say at these levels i would be backing up the truck and buying look, if youre a shortterm trader youre looking to clip points here and there, of course youve got to evaluate. But if youre a longterm investor, facebook, amazon, google, these are names that you need to own. This is a rotation trade, people. They are moving into sectors that have been beaten down. It may last a little bit longer but it will not last forever. Those three stocks david just mentioned are oversold. Netflix is not oversold yet. Lets look at both sides of the story. Xlf, trading at 31. Today, trading at 22ish. You have to believe that all of the regulation is going to be pulled out to get back to that level. Does everyone on this desk believe all the regulation will get pulled out . Why cant we just go 4 higher or 3 higher . Im saying 4 is possible. But 30, i dont think is possible. So youre playing for middle 20s. Huge move. Still fine. But buying facebook, buying amazon, buying google, bang 4 buck is probably more. Remember what jeff bezos can do. Once earnings comes out, he can turn on that spigot again and really show trump. You often say price is truth. What does this tell you, though, that tech these particular tech stocks can go down every single day since the election. At what point do you have to say i have to trade the market that i have, even though i believe these are good, solid companies . Think about the huge story this would be if the market was trading commensurate with the moves weve seen in amazon and facebook. It would be a huge story, right . But its flying under the radar screen because the s p is within a whisper of an alltime high. I think it is a major story and absolutely something you have to take into consideration. Is the s p going to follow these stocks or are these stocks going to balance the current level. Thats the question. Thats the rub. At certain levels amazon specifically is going to bounce. But well have mohammed elerani on. If the selloff weve seen in these four names specifically could accelerate in a major way. You have to define your risk. You think they would accelerate rather than outperform the s p. Well, if the market starts to break down, i think the potential for a move lower on these things a further move lower could be exacerbated. I think they do outperform. I think they have already taken it on the chin and its a yearend bet. If the market now starts to roll off a cliff, the overall, which i dont think is going to happen. So we revert back to the prior trends prior to the election. The amazons, facebooks and google will be hurt less than the overall market. But it is time to start legging in if you do not have a position in those company. They are at levels where you should be buying these stocks, no question. The question is if the biotape continues to work and the financials trade continues to work and thats a big if, right . What are people going to sell when theyre exhausted selling these highly crowded Technology Names . Does it become more broad based . I dont know what the answer is right now, but i would say i do think that these names right here from a valuation basis are a buy. Weve got some breaking news here. Reporter the s. E. C. Just putting out a statement now saying Mary Jo White, the s. E. C. Commissioner, will be leaving at the end of the Obama Administration. Now, this is not unexpected. Typically you do get a changeover at the top of the s. E. C. Between administrations, so Mary Jo White will be leaving at the end of january when the Obama Administration also leaves town and that clears the way for donald trump to appoint somebody of his own at the s. E. C. And there are going to be a lot of names speculated about here but i cant tell you that any one of them has the lead for this slot. Eamon, what would you say her number one issue was in terms of championing a particular issue . Clearly, the whole implementation of doddfrank we were just talking about in the earlier hour is how doddfrank rolled out has been the biggest challenge of Mary Jo Whites tenure. Now youre seeing an administration coming into power with very much of a deregulatory bent, so the question is will the challenge for the next chair of the s. E. C. Be to roll back large portions or all of doddfrank. That seems to be something thats in the cards here in washington. Eamon, thank you. That is something that a lot of the financials have been trading on. Mary jo is out. President elect trump is free to get his own head. Rudy giuliani popped into high head. Dan gallagher is in private sector now, thats going to be a name on the short list. Lets get back to the markets here. Our next guest says a selloff in tech is creating a major buying opportunity. Mohammed elerian joins u now. Great to see you. Thank you for having me. Does that mean that tech will do a catchup to the overall markets . What happens with technology if youre saying buy the dips in relationship to the rest of the markets . So i agree with the discussion so far that the extent of the differentiation that weve seen is too large. Yes, i can explain it in terms of the specific proposals that the president elect has put forward, but not to that extent. So if you compare whats happened to banks on the one hand and whats happened to technology on the other, its simply too far. Theres a good reason for it technically, but i, like you, will start fading. I think theres relative value Trading Opportunities here as there are outside these sectors as well. So if you are to believe that the dips in tech should be bought and perhaps the people are using this money from technology to go into other sectors, are there then other sectors that you think are overbought . So i think banks are one of them, yes. This is a better environment for them with yields going up, with regulation probably coming down. But not to that extent. Also look whats happening in the emerging world. Were having a highly differentiated reaction here in the u. S. And were having totally indiscriminate reaction over there thats causing opportunity. So simply put, i would start fading a lot of the recent moves, but do so within the context of an overall risk budget that doesnt go up too much. Its david. Quick question. Just with the larger banks, donald trump is not a fan of big banks. I dont think hes used a bank since 1993. Hes gotten his lending from overseas or from general electric. So i look at him and say bigger banks versus the regional banks. Do you think the regional banks outperform . I think theres a point there mainly whats happened to the big banks i thi is excessive. Again, i understand the driving forces, but its the extent of the move that is striking and we know why. But yes, theres value in there too. I just would be careful about piling into things that have moved a lot very fast. And look to other areas where the Investment Investors reaction has been totally y indiscriminate. So do you think the dollar should fade wands are a buying opportunity . Does it apply to that too . Do you just extrapolate across the spectrum . So far i was talking to risk assets, be it equity versus high yield, be it the banks versus technology, be it the u. S. Dow versus emerging markets. That so far. The dollar i would differentiate. I think the dollar will continue to strengthen against the majors, but i think that the weakening of the em currencies has been excessive and i think there is value there. Its bumpy but there will be value there. Bonds, id be very careful. We are seeing a significant repricing of the macroeconomic prospects for the united states, higher growth, high inflation. We are going to see some further technical dislocation. Yes, theres a limit to how far they can go. The liabilitydriven investment is going to come in, but i would be very careful in terms of going long the Government Bond market at this point. Well leave it there. Thanks for joining us. Always good to see you. Thank you. Mohammed elerian. What do you think . Be careful piling onto things that have moved significantly the last couple of weeks. For example, look at caterpillars move over well, over the course of the year, look at it since the election. The stock is up 40 year over year, made a 52week high today. They beat on eps okay. Missed badly on revenue. Guided lower for the rest of next year, i believe. The stock is trading close to 30 times forward earnings. To buy caterpillar, youve got to believe every hole dug in the world over the next five years is going to have a cat tractor on the back of it. Let me just go back to you because you bought the day karen was selling some uri, united rental its still go up by the way, her sale was a great sale. Its right around the level where she sold it. Not every single hole will be filled with a piece of equipment rented at uri. Sure. When this positioning trade starts to really become long in the tooth, when uri starts to fade and starts to have lower closes, thats when i know its out of momentum. Then you would rotate back into i owned eem as well. I probably load up more on eem when i sell my uri. Only because then it becomes to me that that infrastructure play is out and the fears we saw on eem are probably overblown. To the downside youre comfortable to say buy certain names in Blue Chip Technology even though they continue to go down. On the upside you want to see them stall out. You dont want to see technology on the upside, i think people were still caught off guard because they dont know the specifics of this infrastructure play. Hillary clintons was 250 billion. Trumps is probably going to be double that. Thats a huge number for uri. What do we do today. The amazons, took a look at it. The financials, the larger cap banks did take some profits in that and i do see real buying in the larger banks than biotech. I see a real rally. I do think theres going to be weakness in biotech, the larger banks pull back a little bit so i do agree. The regional banks, you buy any kind of weakness until year end and theyll outperform. The day after the election we said the plush in Kansas City Southern was a flush to be bought. We explained the reasons why, obviously their huge exposure in mexico. I think the stock is up almost 4 today and they have an event with Raymond James this wednesday. The low has been put in quite some time. Mr. Trump will be far more conciliatory towards mexico than he was when he was running for president , which to me is bullish for names like ksu that have been blujonned the last couple of weeks. Coming up, you will not believe which stock is surging on the trump win. Its sure to drive the liberals even crazier. Dont look now, but mall stocks are surging on the hopes of a tax cut. The names and how you can profit. Later, the banks continuing their incredible run today but two stocks just had their worst day in five months. Well tell you what they are and whether theyre worth the buy when fast money returns. Welcome back to fast money. The once left for dead mall stocks are surging. Take a look, all up 15 or more in just the past week. This as the xrt retail atf has rallied 11 in the same period. So this move prompted citigroup to upgrade many of the names in the space. Do you buy that . Well, im long it so i guess i do. Thats not the only reason. Theres so many reasons. One, i think the space was so cheap going into this. As part of this big rotation to finds an area thats really cheap like this, its great. I think the consumer was always healthy but was sort of concerned about the election and pulled back and so now theyre feeling a little more comfortable. Theres certainty either way, whether you like the outcome or not. Gas prices may be coming down a little bit. Weve seen oil tick lower and lower, thats another good thing. People are employed. I think that its a nice move, but i still think theres room to run because these were way, way undervalued before. You mentioned the comps were working in their favor too. They have a comp tailwind if you will. Next quarter the comps will be a lot easier which is going to help the setup. They have done a really good job, especially the mallbased stores like macys and nordstrom, they have done a really good job cleaning their inventory issues up. Id be very cautious on whether or not these numbers are going to actually improve dramatically, so i think theyre probably going to get to a point where they may be a little top heavy. Would you rather . Im going to think about it. Amazon or macys . Amazon. At these levels, amazon i think. So yes, amazon. And quickly about nordstroms, karen mentioned, last quarter was good but this stock went from 35 to 60 almost in a Straight Line. I had would say 19 1 2 to 20 times forward earnings. If youre not taking profits at 60 bucks, i dont know what youre looking for. The reason why in retail, the reason why these stocks are outperforming is money had to come out of amazon, you talk about that repositioning trade, its a retail specific trade. Came out of amazon, it had to go someplace specific to retail. Thats why the stocks rallied. Lets get some unlikely winners and losers from the election. The New York Times rallying more than 14 since last tuesday. This even as donald trump called the newspaper, quote, dishonest and blasts the organization for its coverage of the president ial race. Then there are the gun stocks getting a big boost today, but still down sharply in the past week. Smith wesson falling more than 14 while stern ruger is down 23 . The New York Times is fundamentally flawed. I dont like the setup here. Its a name id stay away from. They sold more papers during the election, i hope they did, so sell the New York Times. As far as the gun stocks are concerned, if you look at the permits pulled in gun stocks over the Obama Administration, its pretty sinteresting. People buy on fear. Fear of gun regulations being tighter or getting harder to get a gun. Now you say whats the rush . Theres no real rush to step out and accelerate that purchase, so i look at smith wesson, any of these names, i wouldnt be chasing them. These things trade on fear, not on necessarily people rushing out when they dont need to. Smith wesson, which is changing its name announced shortly before the election to American Outdoor brands because of the vast array of things other than guns apparently that they sell. I love that bleeding sarcasm. I scroll through ten pages and i only got guns. Think about when that came out. That came out preelection. So the thought is sort of like massage it a little bit and make ourselves look a lot more wholesome. Because they thought she was going to win the election and they needed to do it before she got elected than after. Now they want to go back to smith wesson. They probably do. We have some breaking news on the Dakota Access pipeline. The news is that the army corps of engineers is saying that theyre going to delay their decision on the Dakota Access pipeline, whether to green light the project or not. They say that more discussions are needed, according to a government notice. They also say that they are encouraging the Standing Rock sioux tribe to weigh in and provide input. The back story is Energy Transfer partners is trying to put together an approximately 1200mile pipeline that connects the shale formations in north dakota where they do a lot of fracking for oil and gas, to connect it to parts of illinois. Right now theyll have to use somy. S from the army corps of engineers. They have not given them and thats the latest development on that front. Melissa, back to you. Of course this on a day when there were a lot of protesters out there, whether it be environmentalists or activists out there. I think you have to trade this all off macro, its got to be crude. Crude specific. Xle, large integrated names. When you look at the whole complex, it hinges on opec. Thpace rallied into the idea that opec was going to cut production. Then it sold off because theyre not going to be biting regardless of what theyre going to do. Saudis really want to cut production. Theyre trying to get a deal done. I think regardless, bearish crude. Obx up 10. 5 today, rallied from 38, trading 50 right now. I dont think thats bullish crude oil. So all the supply thats coming on the glut of oil to me is bearish. Way to expensive. Missed the rally in bank stocks . Fear not because we have an under the radar way to play the surge of financials. Im melissa lee, youre watching fast money. In the meantime her