Every weekday, Jim Cramer’s CNBC Investment Club releases The Homestretch, an actionable update on the trading day, timed to coincide with Wall Street’s Last Hour. In order to get this new documentation feature to our members as soon as possible, audio recordings will no longer be made. Click here for Monday’s edition. Breaking out of lows: After a slow start to the week, stocks were well off their lows on Monday afternoon. The topic of the day may be the bond market. In the same market, yields have soared after Federal Reserve Chairman Jerome Powell announced interest rate cuts on “60 Minutes” amid continued strong economic data. Our six signature stocks were having a mixed day. Nvidia has soared to new all-time highs, while Amazon and Metaplatform have clawed back some of last Friday’s big gains. Believe it or not, Apple stock rose on Monday. The stock is currently trading higher than it was trading ahead of last Thursday’s earnings. Alphabet rose after a weak last week. Microsoft was depressed. “Microsoft is the first buy on the quality of last quarter and weakness on the outlook,” Jim Cramer said Monday. Show-me story: Luxury beauty company Estée Lauder’s stock rose more than 12% in response to earnings, but fell below session highs. Here’s what Jim and I need to see next to increase our rating on the stock to a 4. It’s a show-me story for sure. “Reducing staff is a positive step to address costs, but the next question is how do you restore brand equity after pushing out large amounts of inventory through travel and retail and then dumping it at bargain prices? That’s it,” Kramer said. Sector Leaders: Monday’s leader was information technology, thanks to continued strength in semiconductor stocks. Growing analyst interest in Nvidia and less-than-expected earnings from ON Semiconductor boosted the group. Healthcare rose thanks to a big move in its biggest weight, the club name Eli Lilly. Earlier on Monday, Novo Nordisk announced it would acquire contract development and manufacturing organization (CDMO) Catalent in a strong sign of future demand for GLP-1 obesity and diabetes drugs. Both Lilly and Novo Nordisk have hit record highs as the market is cornered on these treatments. Energy was helped by a roughly 1% rise in oil prices. However, recently volatile natural gas prices have fallen. Laggard sectors: Materials is the worst performing sector, with the group being his second-worst performer year-to-date, down more than 5%. Monday’s spikes were in aviation products and chemicals. The company’s stock price fell nearly 15% after the industrial gas company lowered its full-year adjusted earnings per share (EPS) forecast, citing the slump in China’s economy and declining demand for helium. The downward revision to Air Products’ outlook may cause some concern about Linde’s earnings Tuesday morning, but the latter is a much higher quality company. “Air Products has nothing to do with Linde. It’s terrible and has real problems. Linde is a much better operator,” Jim said. Consumer discretionary stocks fell 2%, weighed down by Tesla’s continued weakness and McDonald’s post-earnings rebound. Interest rate-sensitive sectors such as utilities and real estate suffered from rising bond yields. Earnings Continue: No portfolio names will be reported after the bell on Monday, but stocks to watch include Palantir, Vertex Pharmaceuticals, Simon Property Group, and his NXP Semiconductors. But be prepared for a busy Tuesday morning. In addition to Eli Lilly and Linde, the same club names GE Healthcare and DuPont are also registered. Other notable companies include Fiserv, Spotify, Spirit Aerosystems, Check Point Software, Carrier Global, and Jacobs Solutions. Club Name Ford reported after the final bell on Tuesday. (See here for a complete list of Jim Cramer Charitable Trust stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive trade alerts before Jim makes a trade. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in a charitable trust’s portfolio. If Jim talks about a stock on his CNBC TV, he will wait 72 hours before executing the trade after issuing a trade alert. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
Traders work on the floor of the New York Stock Exchange (NYSE) on February 1, 2024 in New York City, USA.
Brendan McDiarmid | Reuters
Every weekday, Jim Cramer’s CNBC Investment Club releases The Homestretch, an actionable update on the trading day, timed to coincide with Wall Street’s Last Hour. In order to get this new documentation feature to our members as soon as possible, audio recordings will no longer be made. Click here for Monday’s edition.
