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    Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

    Bulls & Bears

    This past week's "Bulls & Bears": Gary B. Smith, Exemplar Capital managing partner; Tobin Smith, ChangeWave Research editor; Charles Payne, Wall Street Strategies CEO; Bob Froehlich, DWS Scudder chairman of investor strategy; Patricia Powell, Powell Financial Group president, and Lenny Dykstra, TheStreet.com columnist.

    Trading Pit: Bush and Stocks Coming Back?

    President Bush is starting to rally in the polls after the death of al-Zarqawi and a surprise visit to Iraq. Stocks are also on the way up. The Dow bouncing back strong this week after losing a thousand points in the last month.

    Is this a big rally for both President Bush and stocks?

    Bob Froehlich: Yes. What drives the stock market is what drives the President's approval ratings. Once we stop tightening interest rates, the economy and the market will rally, which in turn means the Bush rally will continue too.

    Gary B. Smith: First off, I have to give Bob props from a few weeks ago when all of us thought the market was going to make a new high and Bob said, “Not next week.” We've been going down ever since! I do agree with him that everything fundamentally signals that Bush is on the upswing but the market needs to experience more pain. Right now, I think Bush's approval and the market are going in different directions.

    Lenny Dykstra: Bush is definitely on the comeback trail. Bin Laden is dead. If he's not dead, I'll go over there and get him myself for the $25 million reward. We are in a bear market right now. Stocks had a nice little run on Wednesday and Thursday and there will be more of those stints. However, I think the Dow will hit 10,000 before the next World Series winner. I say, “Sell on strength.”

    Charles Payne: The White House and Wall Street are both making comebacks. Both are down for the same reason: unrealistic expectations. When people think of the stock market, they are thinking back to the sell off of 2001. When they're thinking of the war in Iraq, they are thinking back to Vietnam. We are not in those times. Both the President and the market are going to come back up.

    Tobin Smith: We always look at things we don't have control over. We got Zarqawi and that's a good thing. The newspaper articles on how the U.S. is winning the war are few and far between. It is the same thing with President Bush. All you read are negatives, but we are trying to turn that around. As for stocks, the “Toby Bottom” is in and the market is coming back.

    Patricia Powell: Bush is bouncing back, but the market is not. It's just too soon. We've got to get through a tough couple of months this summer. But by the end of 2006, we will all be smiling.

    Stock X-Change

    The Nasdaq's been down, just like the president, but both are starting to make a comeback. Get the names that are ready to make the biggest comebacks.

    Tobin Smith: Parallel Petroleum (PLLL) is really ready for a comeback. It has so many wells now and can pay them off in a year. This company has a lot of cash and I think it will double it in 2 years. The stock's worth $35. (Parallel Petroleum closed on Friday at $21.01.)

    Lenny Dykstra: Energy is tired. I don't like it.

    Charles Payne: I do like it. The stock looks good. It may not go up tomorrow, but it is one to have in your portfolio.

    Bob Froehlich: I love stocks that pay dividends and this is one energy company that does not.

    Gary B. Smith: I'm going with Adobe Systems (ADBE). When you look for a beaten down stock, you look for high reward and low risk. Adobe has fallen hard since April, but is ready to come back. I would just sell if it drops below $25. (Adobe Systems closed on Friday at $29.12.)