Can the S&P 500 hold on for a 7-week gain? Plus, the best and worst Friday stocks
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch – an afternoon update that can work, during the last hour of trading on Wall Street. Stocks retreated on Friday, but the S&P 500 is still on pace for its seventh straight week. The market fell due to a massive bond selloff, which pushed the 10-year Treasury yield to around 4.6%. The 30-year Treasury yield rose 5.1%, the highest level since last May. Bond prices and yields move inversely. Oil rose, with West Texas Intermediate crude retreating above $105 a barrel. Rising market interest rates, reflected in bond maturities, and rising oil prices fueled profit-taking in the hot AI trade, with stocks such as portfolio names Arm Holdings , Nvidia, Qnity Electronics, Broadcom , Corning, and Eaton returning recent gains. The five biggest gainers in the portfolio this week were Palo Alto Networks, CrowdStrike, Qnity, Nvidia, and Cardinal Health. Our cybersecurity names became big winners after the market realized that AI is accelerating their industry, not replacing it. A blog post published by Palo Alto Networks on Wednesday estimated that organizations have three to five months to act now before AI-driven exploitation becomes the new norm. Qnity had a great week after reporting a strong beat and rise. Nvidia hit a new record high on Thursday thanks to AI enthusiasm. Also, investors viewed CEO Jensen Huang joining President Donald Trump on his trip to China as a positive sign for the chances of Chinese companies buying chips again. Cardinal Health finally put together a good week with encouraging pharmaceutical volume data. The five biggest losers in the portfolio this week were Boeing, Home Depot, Dover, Salesforce, and Amazon. Boeing met before the meeting in China expecting a large order, but the 200 jet deal Trump announced had no details and was below the expectation of 500. Many consumer discretionary stocks sold off this week on renewed inflation concerns, but Home Depot was hit hardest as rising mortgage rates threatened to freeze the housing market. Dover fell for unclear reasons. It was actually a little surprising to see industrial stocks so low on the list. But higher prices can slow industrial activity, and companies in short-cycle industries are often the first to feel the impact. Dover is coming out of a segment where orders are up, and management says demand continues in April, so we haven’t made any decisions on stock yet. A strong Friday for Salesforce couldn’t shake off its bad start to the week. In the current environment, traditional software stocks tend to have an inverse relationship with AI trading. Finally, Amazon jumped from its record high made last Thursday. Although its Amazon Web Services (AWS) cloud continues to perform well, concerns about weak consumer spending weighing on the retail side of its business have weighed on the stock. A big earnings week is coming up, with several consumer names and Nvidia scheduled to report. Within the portfolio, Home Depot reports Tuesday before the open, TJX Retailer reports Wednesday morning, and Nvidia reports after Wednesday’s closing bell. Other reported keywords are Walmart, Target, Toll Brothers, Cava Group, Analog Devices, VF Corp, Intuit, Deere, Take-Two Interactive, Workday, BJ’s Wholesale, and Ralph Lauren. On the data side, we get weekly jobless claims, April pending home sales, housing starts, and building permits, the S&P Global US Manufacturing and Services PMIs (purchasing managers’ indicators), and the latest University of Michigan survey of consumer sentiment and 1-year inflation expectations. (See here for a full list of stocks from 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 stock in his charity portfolio. When Jim talks about a stock on CNBC TV, he waits 72 hours after issuing a trade warning before making a trade. THE PRIVATE INFORMATION OF THE BURNING CLUB IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AND OUR PRIVACY POLICY. NO LEGAL LIABILITY OR OBLIGATION EXISTS, OR IS CREATED, BY YOUR ACCEPTANCE OF ANY INFORMATION PROVIDED BY CONTACTING THE INVESTMENT CLUB. NO PARTICULAR RESULT OR INTEREST IS GUARANTEED.
