Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. We’re no longer recording the audio, so we can get this new written feature to members as quickly as possible. Here is Friday’s edition.
Down to the wire: It has been a choppy day. The key part is that the market recovered its early losses, shrugging off a hot reading on producer prices and rising bond yields. It’s a different trading pattern than on Tuesday when a hot print on consumer prices spiked bond yields and slammed stocks. The S&P 500 finished at a record high Thursday, putting the index just above the breakeven line for the week. If the gains can hold, that would mean the S&P 500 closed higher on a weekly basis in 15 of the past 16 weeks. It’s been that big of a run.
Broadening out: What’s notable Friday is the S&P 500 is hanging in there without much help from the Magnificent Seven – Alphabet, Apple, Amazon, Meta Platforms, Microsoft, Nvidia and Tesla. Most of them are trading lower in session, with the notable exceptions being Nvidia and Tesla. Remember, Jim Cramer kicked Tesla out and renamed the group of mega-cap market leaders the Significant Six. We own all six in the Club portfolio. The top sectors in Friday’s market are materials, health-care and consumer staples.
Club winners: Wells Fargo was the top performer this week, thanks to the 7% surge Thursday in response to regulators terminating a consent order. GE Healthcare was second on the list. UBS upgraded the health-care company to neutral Monday. HSBC initiated coverage with a Street-high $100 price target Thursday. Surprisingly, despite news of a 13 million share secondary offering tied to General Electric‘s stake in GEHC, shares reversed early losses Friday and traded higher. That’s a great sign. Other notable outperformers this week included Eli Lilly, Foot Locker, Danaher, Linde, and Disney.
Club laggards: The mega-cap tech stocks led our portfolio lower this week, with Alphabet, Microsoft, Apple, and Amazon among the worst performers. Starbucks also underperformed. After back-to-back ugly sessions, we added to our Starbucks position Wednesday when shares fell back to their pre-earnings levels. While the coffee giant needs to prove that it can reaccelerate same-store sales growth, the fact that the stock did not fall on earnings despite bad news indicated to us that the market has priced in a lot of downside at these levels.
Next week: Four companies in the portfolio are scheduled to report in the holiday-shortened week ahead following our recent Club earnings lull. Palo Alto Networks and Nvidia are after the closing bell Tuesday and Wednesday, respectively. They are the big ones. Both stocks are off to blistering starts to the new year. Bausch Health and Coterra Energy both report Thursday. Outside the portfolio, we get earnings from Walmart and Home Depot.
Mark your calendars: On Saturday, February 24, we’ll be hosting our 2nd Annual Meeting for members of the CNBC Investing Club with Jim Cramer. Check your email for more details.
(See here for a full list of the stocks in Jim Cramer’s Charitable Trust.)
As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade.
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