implementation. "fast money" with melissa lee and all the traders starts right now. from the nasdaq in new york city time square i'm melissa lee, this is "fast money." they have your winning game plan. alocoa to become the first dow member -- or serving after hours and pointing to a higher open tomorrow morning. headlines out of alocoa, loss is smaller than expected, revenue better than expected. in terms of cost savings the compy is doing better than they planned. they said $2 billion in procurement savings over the next two years. they record a billion dollars in the first half of the year. they're way ahead. very positive signs. >> higher shares of shipments and alumina, very positive. we got a lot of news on this yesterday. stock was beaten down. alocoa always disappoints.

this was a very positive number from these guys. first stock beaten down. from a trader's perspective you're offside if you followed the rally yesterday. which i had done. i had a long position which i lightened up yesterday. i'm still long but not earning season we say it's not a be bellwhether. in this case it coo it be? >> what's important about this report is it highlights the intensity of the credit global crisis. management managed that bottom line so well and you're seeing in protection how they cut back on production, work force, cost, labor. i think going forward you'll see other companies that have managed the bottom line particularly well and they have done so because this crisis was so intense, it really scared management. >> i think it's a bellwether. this will give it further smart to maybe rally but now you have

a bit of a benchmark. it got there today. closed, yes, low on date but rallied nicely. alocoa on the back of that. might bode well tomorrow? >> is this a bellwether in your view, karen? keep in mind alocoa is the smallest on the dow jones industrial average because its share price is the smallest. >> i don't put a whole lot of stock in this as being a great cater for what we'll see in the weeks to come. >> managing the bottom line, they did that very well, nothing? >> this is the third con sec pif quarterly loss for these guys. the protection element -- joe said this. they've cut back production and that's the key with aluminum. people believe there's supply, 5 to 10% away. they need to bring that down. >> i believe the earning season is going to be about how companies are managing the

bottom line and cutting back. >> oh, i think the earning season will be about outlook. i think the last quarter wasn't great and the beginning of the quarter was particularly -- it did improve -- >> we're 1 for 1. >> feels good, america. so far we haven't gotten any headlines on the outlook but rebecca jarvis is listening in on the conference call and tweeting. we'll check back with her for any -- >> it's like we're running a telethon. stand by. >> we'll take your money. >> it go to a good cause. >> we'll check in with rebecca later on. back to the markets, s&p 500 hitting the lowest levels since may 1st. where's the best place to be heading into earning season? do we continue on with this rotation we've seen in the markets day after day, this week at least? >> the we were talking about this before the show started. the most interesting thing to me was the reversal of the oih.

oil finished down sharply but the oih turned it around later in the day and went up on the day. decoupling entirely from the underlying oil. >> let's bring up the chart so viewers can see exactly what they're talking about and see the divergence. what is the reason for that, joe? >> i think what you're seeing is a lot of the investment community right now wants to get exposure to energy outside of the energy features themselves. we have we've talked about the derivative, ice, they're under pressu pressure. looking at oih, oil trading at $61.50, oih is down around $87. oil continues to go lower. i bought oih after the inventory numbers went out. oil goes out trading $60.12, oih trading $90.25.

i think oih it gives you a point of revens and clearly the bottom is in place there. >> wie been talking about oih going down to $90 and we said buy when you get there. i'm not trying to be a jerk but it's not a surprise to me because we talked about the 50% correction coming in exactly where it stopped. we said the same thing about slumber j. we gave it the 870 level on the s&p. things are working out as planned. >> we talked about the potential impact the cftc limits on contract but in terms of the impact we could be seeing in the equities and you mentioned the exchanges, ice, et cetera. what you're saying, hearing from the trading desk is that they will see less volume and therefore they will be -- >> you want energy exposure. that's not going to change. they're just going to move your exposure away from oil futures, which are down -- >> so the volumes will be down on exchanges like this. >> you have to move away from the exchanges and look at the

energy equity names, oil services, integrated names, get the -- >> this kind of attack on speculators, which i think they're really going -- >> it's zombie buyers. >> this is also going to hurt liquidities in the futures market which is where real players are. i ent know they're helping people. i think the comments out of the french and germans that you're going to begin to stifle the return of the economy because of higher energy prices is totally off base. i don't think that's where we're going to see, you know, the recovery run into steam. so i think the speculation is one more case where people are taking that, along with fundamentals and using it as an opportunity to sell oil because the fundamental reason which does not look good. today's inventory numbers said that. >> in terms of exchanges, just to put a button on this thing, is the reaction overblown? >> completely. people blew out of those thing. joe was talking earlier, people got short these stocks

yesterday. a nice trade but don't hold onto the shorts, folks. you can get your you know what squeezed. i think there are great opportunity. you look at the volumes in exchangin exchanging, especially cme. you heard donahue on "closing bell," he made great comments. i think cme is a buy right off the bat. >> all of this stuff, it is trading vehicles. a lot of names made reversal as today. oil lower six days in a row. on the seventh day it rest. i got oil long on the close on the seventh day hopefully we rest. take a look at rncht i.m., you saw a powerful reversal, got below $64, hasn't done that in a long way. we were looking for the capitulation moment. the price of rimm jumps from $65.25 and goes $65.50 that's a tell bottom is in place.

gives you a great point of revens. i bought it. >> let's move on to the next. in addition to oil banks weighed on the market. bernstein cutting estimates for morgan stanley as well as goldman sachs. trimmed back earnings on these names partly because of the fdic cost assessment and because of the t.a.r.p. could this be an opportunity? we're seeing goldman sachs trade although $136 and change. that's the best in clas. we've been taughting it here for some time. >> it's a big dollar stock. these stocks do move in inches. goldman was ahead of itself. i think it could come in a little more. and that would probably be a decent place to buy it. i wouldn't be buying it just for this quarter's earnings. i think the bar is high. i think the earnings will probably be pretty good but you have to look at it as a longer chance -- >> i'm sorry. it doesn't mean we hate the

company. we talk about goldman sachs trading lower, this stocks got ahead of themselves. it means you can dip your toe. doesn't mean i'm a raging bull. another point of reference. >> you are a raging bull but not on this particular stock. again, brad we love, he comes on the show all the time. what he's alluding to or ultimately positives, the cost of repaying the taemp .a.r.p. w hurt these guys but it's a one off. credit spreads are tightening, this isn't accounting cal thinnic. this wasn't nothingly driven to undermine the fundamental diet of these guys going fwrd. >> it goes back to what morgan stanley did last quarter. they had to mark up the liabilities and the street punished them. for a day or two it was the low and morgan stanley was a buying opportunity. >> we had something that aired

earlier by aaron burnett and he said he sees a recovery in 2010. he said some reforms could hurt a consumer-led recovery. does that make you more cautious? this guy has his pulse on the consumer and entrefshlg trenched in the financial world saying the recovery isn't happening this year. >> sure. we got a consumer credit number saying consumer credit has declined some $60 billion over the last eight months. this is a significant claw back in the spending power, especially that which drives a recovery. i am concerned about that pip don't think we can't rally off lows. i think a sustainable recovery, which is what i think he's referring to, it's not here and not in the future. >> the number was that it wasn't down nearly as what people estimated so, in fact, the consumer is spending more and that led to a turnaround in some consumer names. weet get same store sales

tomorrow to see how they held up in the quarter. that was interesting. maybe the consumer is -- >> not as bad -- >> it's exaggerated. >> exactly. >> the market itself will tell you whether the environment is improving. last week everyone was wildly bullish. today if you listen to everyone on the network, everyone was wildly bearish. we talk about revisiting the lows back in march. everyone has a different interpretation in what's going to happen in the economic landscape. this morning, imf raised the growth outlook for 2010. >> let's move on to the next trade and this is the other thing that could help that consumer out there surging. strong demand for the ten hich year note auction. we saw the ten-year dip down to two-year lows which is a good sign for anybody looking to lock in a mortgage ralt. >> not a good time if you are a short longer term treasury, which i happen to be. for this particular consumer it wasn't delightful. >> but longer term -- >> i still think -- >> ultimately, juxtaposed

against the consumer number, falling yields is a big negative for our economy. it means people are not very bullish on the short term prospects and the ten year means the outlook on inflation isn't quite as bad. the bid to cover was the highest they've seen in 15 years of this auction and this is the ten year auction. this is the auction. this was an extraordinary event. and i think it was five bips through where they were expecting it to come and rallied another five after that auction. an exclamation point on economic weakness. >> gold, we talked about at 950, we said no man's land, any hint of inflation around the corner. now we're traiting 910. if you're long, this stock a trade. as an investment, i get it. as a trade, you're vent feeling good right now. i think it moves lower from here. >> let's move to the next one. topping the day, walmart, jcpenn jcpenney, the discounters closed higher following -- ahead of

tomorrow's june sales figures and on the back of positive results out of family dollar, which is a story we brought to you here yesterday. john was talking about -- >> he nailed it. >> yes, he absolutely nailed it. this did make the bid for the dollar type source. the dollar frees of the world, the discounters higher today. is there still value here or is this trade, this trading down trade passed its prime? >> the consumer is looking for the basic item at the lowest possible price. names like kohl's, that works well. dick's was upgraded as well. family dollar, all these names where you allow the consumer the ability to walk in and get what they need at the cheapest possible price, i don't think that story -- >> walmart, if you're looking for where can the consumer go that's the cheapest, the biggest, it's walmart, no doubt. >> in terms of trading the stock, family dollar closed up 12.5%. you would say take money off the

table. we saw it at 5 a couple weeks ago and then it corrected. i think there was a neglect journal or barron's article or something. i think it has room on the upside. >> google announced it's developing an operating system to compete with windows, had the drudge report running this headline. googe plots death blow to microsoft. >> never happen. >> how much will it be. google comes up to attack microsoft's core progress. >> which is precisely my point. let's talk about this for a second. when microsoft unveiled binge they laughed at it as any type of threat to googled because microsoft was entering the

search business. as soon as google announces plans for an operating system, all of a sudden it's microsoft's death now. let's not forget that kromos is at least a year away, and windows 7 from microsoft, which is getting real good reviews, is a couple weeks away from hitting the marketplace. by and large, if you're going to trade on this or invest on it, you might be soarly disappointed as far as any real action is, based on these headlines. >> is part of the root of the concern, jim -- there you are. we had a flash with your satellite. part of the concern that perhaps kron could be used on network in the pc market? >> that's very much the case. but it's not as though microsoft is sitting still. it's not as if xp isn't interesting or windows 7 may not be interesting in some new fork

for netbooks down the road. google has tried the operating game before. an droid is enjoying some pretty good traction with mobile smartphones, if you will, and big companies like hewlett-packard are testing it as far as using it on new netbooks. google is looking at net books down the road but this isn't anything until 2011, 2012 at the earliest. >> i totally agree with you. it's joe. the smartphones have evolved into the technology of today, 2009. when you look at the operating systems, it seems this is where the technology is not based on 200. what google doing advantageous to everyone, including microsoft where they'll look at what they haven't tried and bring it up to 2009 technology levels? >> yeah, that's a great point. if you look at what we're seeing with smartphones today, that's one of the reasons apple isn't getting involved in netbooks because it says look at the i

want phone. this is essentially our version of the netbook because it does everything all the other netbooks do and then some. google is playing the groundwork, trying to put a lot of this operational capability as far as operating systems are concerned into the cloud, on the web, that's good for google, the more people who go on the web will search on google, at least that's the conventional wisdom at google. i don't think microsoft is sitting still, though. i think that when you look at what google is doing today, it is not such a stretch to believe this is exactly what microsoft is already doing and microsoft's got, what, 20, 30 years on google in the operating system business? i don't think it's just an -- you know, an automatic slam dunk that merely because google has now shifted its spotlight to the operating system that it's going to be the defacto winner. >> and 90% of the market share. >> got it, jim. thanks. this remind me, google entered the search market when yahoo! was the leader and everybody said yahoo! has it on google because they've been in the market so long.

that's just a cautionary tale. the share price did go below $400 a share. you were talking about the levels there. i don't know. it seems like a bounce back -- >> the s&p made a low. if it does hold and google is a proxy stock to be long. 870 felt like it held today. we'll re-evaluate. >> you're using the weakness in microsoft to buy, joe? >> i -- >> lover of microsoft. >> i did not buy microsoft just yet. i will. >> what level? >> it's -- you know, when you look at it, it is more about seeing the price action, the reversal price action higher. i would like to see follow through in the s&p and results of next week's earnings. microsoft is a slow mover. . gives you plenty of time. >> karen knows that well. time now to see what's going around the trading floors today. the latest, to jump on the regulation band wagon, you'll never guess. >> who? >> pope benedict xvi.

>> liar. >> pope benedict in his latest he criticized the financial system where pernicious effects are seeing evidence and urged the establishment of a true world mrig authority to oversee the economy. so he wants a global regulator. i guess, beyond the almighty. that was the word on the street. the latest from the alocoa conference call from rebecca jarvis and here's what else is coming up on "fast money". alocoa after hours. we break down the economic bellwether's outlook to see where this market's headed next. steel wars. china detaining an executive as one of the biggest iron ore producers in the world. it's an international espionage story. one sizzling fast food trade is losing steam. will new items whet the appetite

of beaten down consumers?

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welcome back. we're live at nasdaq smashgt

site. alocoa is trading higher after hours. 26 cents a share was the loss. rebecca jarvis was on the company conference call and she joins us with the lateest. >> we have the company ceo of alocoa going over the numbers. a couple of big highlights. he talked about the auto industry, clearly important to this company, given they dial in aluminum and that's a key xoen end in the auto industry. he said he's seeing signs of stabilization in the auto industry. for the month of june he said orders have gone up 10% for class 8 trucks and obviously we know the headlines here. we got to those earlier, but the earnings upbeat on top and bottom line. on the top line it was $4.2 billion versus expectations of $3. billion. bottom line, their consecutive quarter of losses but fewer cents lossed on the share basis than many were anticipating, 26 cents loss a share versus

expectations of 38 cents a loss. >> it's karen. did he talk about the breakdown in the airline business, what are they seeing there? >> he's actually talking about it right now and i've got it sort of a little light on the speaker because i'm talking with you. and i will definitely tweet that as soon as we have that information. sorry. >> did he stress, though, the bottom line? what i think is these guys are very close if not free cash flow positive for the first time in a long time, their balance sheet is what's worried people. if they can withstand the downturn, this is the story. >> absolutely. the cost side has been a major element they've been expressing throughout the conference call. they talked about the head count reductions. 21,000 in head count reductions, down 18,000 of them. they say 75% of them they estimate will be formally in place going forward. those people will not be rehired. they talked about the liquidity position. the cfo said liquidity position is showing market improvement and he said they're exceeding

expectations in every segment, and that is being realized in their financial position but they are happy with the cost savings. they've cut a lot back on cap backs and in terms of driving down their inventory. they said they've been living up to that goal and continue to pursue it. >> thank you. get back on that conference call and keep tweeting because i'm sure our viewers want to know what this ceo says. the ceo is seeing a cyclical downturn in aerospace. based on what he's saying, based on rebecca, doesn't make you any more bullish about alocoa. the fact of the matter is upturn in demand, we -- >> i think auto production in the fourth quarter is where you want to get on this trade but it will help these guys and help the steel companies. >> didn't we know that already? didn't we -- >> i don't thirpg it's that big of a surprise. the surprise was on the bottom line, not the top line. it means this company has

cleaned up over the last few months and positioning themselves. aluminum and steel stockpiles have 20% ahead of themselves. >> your favorite nfl quarterback will be very happy about this. >> yeah? >> yeah. >> why? >> loving alocoa. >> let's check on dow futures. it looks like we are ticking slightly higher. alocoa once again because the dow is a price-weighted index, alocoa is the smallest member because its share price is the smallest on the dow so the impact on the dow is contained, but still -- >> s&p is up two points -- >> you have to remember the dow has really become irrelevant. look how it closely -- not closely, decoupled from the s&p. the dow is down way -- it's not even relevant. >> that's a good trade school. it decoupled from the s&p 500 because it's rigged by share price as opposed to market capitalization. >> rigged is the right word. rigged.

>> i just meant rigged meaning wired. let's move on here. >> pretty heavy accusation there. >> yeah.1á one word, it's a firestorm. much more to the metal story than alocoa. we'll uncover a steel deal with international intrigue. while china has execs from rio tinto. heading over to prop desk, if you've been noticing there are fewer and fewer ten ents living in your condo building, karen has found a way to trade that that. >> i think most of the trade, if you look in the last month what's happened to the commercial real estate and the rental space, avalon bay is a name we have in that space, this stock and this industry in general has sold off very hard in the laos month. down 16%. you see stories like this coming out today and talking about a new york rentals down and there was a hope that people who

couldn't buy homes would then go to rented. if you lost your job you're not doing either. and because -- >> where do you live? >> you live on a couch with your friends. >> you have to live somewhere. >> the prices of houses continue to come down and they're more affordable so the rental cushion people thought was there isn't there. all that having been said, with the stocks, avalonbay, it's done 14 point from the high. it's it's a cover more than a short. the move has happened already. >> let's move on on to the next. burger wars heating up. mcdonald's announced the launch of a new angus burger and maybe a $1 cheeseburger. the ceo of cke restaurants, andy twister, who owns carl's jr. as well as hardee's joining us on the fast line.

>> good to be here. >> so many people offering the economical offerings. are you ramping that up and how will that impact margins? >> we are not ramping up value offerings, we have very good affordable, value offers. we focused on the premium product. when you come out of an economic recession you want to be known for something positive. we've been known for our premium burgers, char broiling, black angus beef and we're not going to lose that so we have not changed our focus. >> i'm getting hungry with those offerings. in the short term if burger king offers this $1 double cheese be burger, it will be out on the market, will you feel the impact? consumers are pinched for pennies. they may not go to the premium angus burger, as a possible? >> we call them bottom-feeders. burger king is run by smart

guys. they're doing what's best for their company. to the extent we've had any hit in sales in the past six months, it's been two things. fewer people getting fewer come bows, not premium burgers. i guy a year ago said i'll take a $6 combo is now saying i'll take a $6 burger and a glass of water. the other consumers we're losing are the 99 cent guys which are the least profitable consumers. so for first quarter, our margins were about 19.9%. and i think burger king was in the 11% range. you know, they're doing what's smart for their company. that would not be what i would do. >> you're a smart guy as well. i know you're going to tell me north american opportunity is a great growth engine but they're kicking it in asia. what are you doing? >> i'm figuring we'll open in shanghai in october, september. and we have commitments for 100

restaurants in beijing and shanghai and talking to people in other parts of china. we have restaurants in singapore and malaysia. and we opened in singapore, and those are huge opportunity markets for us. >> quickly, where do you see the u.s. economy? when will we number a recovery? >> i think we'll number a recovery when the government starts doing the right thing to encourage business instead of trying to spend us into prosperity? >> which would be when? >> i think they have to get really scared. 9.4% unemployment would scare me but it squared the government into spending more money. continuing to spend on roads and bridges isn't going to do it. >> great to talk with you. hope you'll join us again soon. andrew puzder. >> if, in fact, this asia move is for real and he's got his arms around it, then you can be buying a yum early on with ckr.

we've had him on before. stock hasn't done much but it could be an early play. >> you're also buying what the strategy is going forward. when you come out of the economic recession, how does he keep the market share that he has gained during that recession? that's the strategy. if you're buying this longer term for an investment, you're buying that -- >> that's a concern about this burger king strategy, that is, it will canibalize their profits. >> mcdonald's, moving into coffee was a high margin business was the rye the way to go. that's what you need to look to, especially growing globally. >> that was a shout out to pete. >> i was feeling the loss of pete here and -- hey, pete. >> never got that hamburger last night. >> we will be talking to pete, the pit boss, later in the show. >> let's ask him about it. >> the imf predicting strong

global recovery in 2010. what should be on your buying list? joining us with his picks, washington redskins player turned four star mutual fund manager, eugene profit. >> is it a real name? >> it's for real. >> let's second the record straight. you believe in a recovery in 2010. what are the best ways to play it? >> i think you heard him a say the second half 2010. i say 2010 we'll see the best improvement. we to want look at companies that executing right now. so one of the names we bring is u.p.s. u.p.s. we know, big brown, global transport company, had 20% better yields on package delivery than fedex. it's now at a price point that you can buy it because of the economic recession. they're using this time period to sell off some old dc-8s so improving their bottom line. when the company turns around,

packages still occur and u.p.s. will be a major beneficiary. early cyclical play. another name is visa. we actually bought visa today. we had it up on our list to buy when it got down to about the $59 area. we think it has a $70 valuation price. the benefit of visa is that with e-commerce you'll continually have more transactions occurring. visa is the leader in debit card transactions. internationally you're starting to use debit cards for transactions -- >> like an e-commerce site as well? >> i do. online jeweler, the largest certified jeweler in the united states. they had 6% revenue growth. their average ticket is about $2500 per ticket. they're big in the 25 to 35-year-old male market. they spend a lot of time online. we think economy will turn around being people will be getting engaged, people will

still be buying diamonds and blue nile has the most. >> eugene, great talking with up. hope you come back. >> my pleasure. coming up next, if you thought you could wait out a correction in the stock market by hiding in gold, think again. we explain why clouds are forming over this supposed safety trade. on tonight's "trader radar "qult we look at stock lighting up screens across wall street today. founded in the late 1980s, this casino operator has seen a good run this year after expanding into the far east. >> my cost safings and higher traffic. >> today the shares nt far south afthey said they need billions to finish their hotel projects. whis it? on the trader radar,

las vegas sands, among the most active names on the nyse today. welcome back to "fast money." here's what's coming up in the second half of the program. trading the globe, steel wars, latest international intrigue between china and australia that got one executive locked up.

you might be ready to give up the energy trade. and trading after dark, the bit boss pete dials in with the biotech live from his trading desk. time to test the technicals. greg has your fast forecast. >> cloud conditions persist in the s&p market. last week we warned you in this consolidation we had key support although 74. the fact is yesterday we came down to 875. did not close below 874. that's my key point on a close basis. warned you about it. we're still in the consolidation. we closed before 874, full rain conditions but we're not there just yet. watching it day in, day out. gold, near term support around 920. we failed to get above resistance of 950 last week. moving average line starting to turn over. this at this point still cloudy if gold breaks before 950.

turning to the treasury market, nice downtrend here that the market violated. price action to the upside. that is the inverse to stocks. there's a flight to quality taking place right now in the treasury market. hence, we have price action moving up as stocks remain under pressure. that could reverse rather quickly if stocks do have that 874.11. s&p 500 market, september contract, that's the tradeable one. expect rain only if we close below 874. we talked about that point are for the last week and a half. gold, sun comes out above 950, between 920 and 950. mixture of sun and clouds. we're down lower into that range, cloudy. treasuries, flight to quality, treasuries moving up based on the fact that stocks are under pressure. that could also reverse if we hold the 8874 level. we have your backs covered. >> thank you, greg. the bottom line is carry your umbrella and wear your shades. >> can i change one thing?

in gold you have to change that to a siberian winter. that's the outlook in gold right now. let's move on to today's editions of pop and drops. family dollar up 13%. >> we talked about getting above $35. i agree with him. they're managing the bottom line well. earnings are increasing. >> btu, what's popping, 4%. >> goldman upgraded it. the difference they said peabody is heavily exposed to asia. >> general electric, parent company of this network, down 3%. >> they're worried about debt concerns. the right price for the stock is 12, 12.50 so anywhere around 10 you want in. >> pop for costco, up 3%. >> it was on the back of family dollar's figures. same kind of space. if you want exposure to the space, walmart is the name to go to. >> we got a drop for john meriwether, the iconic trader, shutting doors to the hedge fund

he started ten years ago after losing almost 40% over the past couple of years. this follows the 1998 crash of long term capital, another hedge fund meriwether founded which proves to you on wall street there's always second, third, and fourth chances out there. coming up, the case of international intrigue, why china's authorities locked up an exec from australia's steel company. next tsydney.is trying to download theocs. which rned out to be the old-nedocs... rather than the new-new cs. then bob dialed in from home and s... whh katyissed because she was buyi shoes online. and then hit mute... to talk timelines with my team. gettg lots of dirty looks through the phone in the proce. - erall... - a great call. - great call. yeah. introducing a better way. learn more at cisco.com/nways

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welcome back. we're live in new york city. steel wars after stalled negotiations iron ore, china detained a manager from rio tinto on espionage. let's go to sydney with karen. >> four rio tinto executives were jailed. one is an australian man. according to shorts, rio shanghai offices raided and computers moved after the detentions. sources in china are saying it's part of a broader investigation

into allegations of kickbacks paid during the allocation of raw materials to state owned steel mills. speculation about the real arrest, the timing is significant to some. china has been pushing for a steeper cut in iron ore price. some believe behind scenes agreeing to a 30% reductions. but rio has been a producer at the front, pushing for a higher iron price. rio general manager of marketing was arrested in china and he determines who receives what. rio/china relations are strained. china feels as though it was strung along by rio. the two were to partner with injecting $19.5 billion into rio. rio snubbed. the detentions, of course, have

unnerved foreign business people in china. from a global perspective as china demands a bigger role it throws into questions the practices behind the great wall. china official as the g-8 will be under pressure to reassure other countries that china does, indeed, engage in fair dealings. while china authorities don't always detail allegations in this case it will be pressured to do so, especially if it wants to maintain relations with australia. >> karen, thanks for that. karen out of sydney for us. >> karen raised an interesting point. the reality is that rio tinto almost did a deal with china chenlco for an aluminum stake but also to get closer to iron ore. i goent think this changes anybody's view whether they wanted to do business in china before or not. i think it shows the value in

the ore company. rio tinto and bhp, they are cutting deals with chinese. i think great opportunity here and i think the steel trade is just starting to come on board going into the fourth quarter. weeg seeing steel prices rise around the country. if you look at u.s. steel and nucor. >> there you have it. coming up, today marked the sixth consecutive drop of crude oil. don't declare it dead.

time now for what you've been waiting for, an oil trade that actually works. >> melissa, you have to cuddle up to the ugly duckling. you have to cuddle up to the duckling and the refinery section is priced for armageddon. we have not seen any increase in expectations. take a look at the names and buy the worst one, the one down the most. i bought sunoco, trading at 21 bucks. it is a great way to play a potential turnaround in the auto space, miles driven, a great way

to play turn around in economic activity in terms of trucking activity. how about the hurricane? potential hurricanes, refinery margins will move higher. you can't replace barrels of lost gasoline. it's low trading at $21 but it is a very ugly duckling. >> let's get to trading after dark. >> straight from trading desk tonight is the one and only pit boss, aka pete watching biotech, big shares in amgen. we talked about that yesterday on the desk from positive results from the study. what are you looking at? >> the impressive thing, melissa, by the way, hello, amgenn has been a phenomenal stock. when you look at it, it trades at a price to earning ratio much more like a utility stock. it's incredible. it trades even at $60 a share, which it is now, and $60 billion market cap, we're talking about

a 15 pe. you're also talking about the potential of this drug they've already got at phase three that had so much following yesterday, including today. you're talking about a multibillion dollar drug. then you look at the rest of the pipeline for amgen and the biotech space. it's not priced like the old days of biotech. we're seeing pricing very favorable. the beet that is a 0 poth 4 so moves at half the voluntarility to the s&p. soist a very, very interesting stock even at the $60 level. >> we missed yesterday. s&p. soist a ry, very interesting stock even at the $60 lel. >> we missedesterday.

welcome back. let's goat straight to it. the final trade? >> mt cutting deals with cut on covenants. this is a trade up. >> intel made a 1578 today. >> karen? >> wells fargo preferred. >> got to love american express, top performer in that irrelevant industrial average, performed well today, so much exposure to the consumer but yet it continues to defy logic and moves higher. >> i'm melissa lee, thanks for

watching. see you 12:45 and back at 5:00 p.m. for more "fast money" on cnbc. tomorrow, where in the world is recession receding? "fast money" takes you around the globe on the hunt for the strongest economies, the smartest trades, what's your next play? travel with the pros on "fast money," 5:00astern on cnbc.i ty for an annuity with guaranteed income for lif th's right, guaranteed ince for life. my annuityrom fidelity means my retement income is safe. it's guaranteed, no matr what happens. if guarad income for life sodsood to you, dohat i did -- let fidelity be your guide. call felity ... for details about guaranteed income for li.