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CNBC
an hour ago
- Business
- CNBC
One stock we might need to buy on the dip and another Cramer would buy big now
Every weekday the CNBC Investing Club with Jim Cramer holds a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Monday's key moments. The S & P 500 fell on the first trading day of June after a weekend of no progress on China trade talks. In fact, China refuted President Donald Trump 's accusation Friday morning that Beijing violated its trade agreement with the U.S. The White House on Monday said Trump will likely talk with Chinese President Xi Jinping this week. "I think the Chinese would be nuts to make a deal," Jim Cramer said during the Morning Meeting. "China does not seem to have as much to lose as we think." In Jim's Sunday column , he looked at how the president's tariff unpredictability is holding back the market in 10 ways. Late Friday, at a rally in Pennsylvania, the president said he's doubling the tariff rate on steel to 50%, starting June 4. Shares of steelmaker and miner Cleveland-Cliffs on Monday jumped more than 25% on the news, while rival Nucor , which is in our Bullpen, gained more than 10%. Steel tariffs, in theory, can even the global playing field on price. Companies that make steel and service the domestic industry may benefit in the near term, but what about industrials that rely on steel as an input cost? Many of them are down Monday, including Club name Dover, which has some steel exposure. "We might have to go pick at this one," Jim said. "I think that's way too low." "Let's go to something I find actionable in our portfolio that I do not get," Jim said. "The action is Capital One." The Club stock, which was down Monday with the banks, has not been rewarded for its Discover acquisition. Goldman Sachs put Capital One on its conviction list. "When I worked at Goldman, I would have picked up the phone and told everybody they have to be in this stock," Jim said. To investors without positions in Capital One, "I would be a huge buyer of this thing," Jim said. The benefits of the acquisition are "intrinsic and excellent," Jim said, noting the catalyst of Discover's payment network and the prospects for second-half stock buybacks. Stocks covered in Monday's rapid fire at the end of the video were Campbell's , Bullpen name Boeing , and Club name GE Vernova . (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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
CNBC
3 days ago
- Business
- CNBC
Bad trade headline after another hit the market — but a key economic tracker is looking up
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. Markets and trade: Stocks dropped Friday but are still on pace for a solid weekly gain. The market broke down around noon ET after Bloomberg reported that the Trump Administration was planning to broaden restrictions on Chinese tech companies. According to the report, the new rule would require U.S. licenses for transactions with subsidiaries of companies on the U.S. sanctions list. It's too early to know the impact, if any, this could have on U.S. tech companies. One would think most companies have stopped selling to businesses associated with U.S.-sanctioned companies, like Huawei. Until we know for sure, these restrictions represent a negative headline for the tech sector and China-exposed companies that were hoping for the recent detente to continue. Developments over the past 24 hours suggest a notable decline in goodwill between the United States and China. On Thursday, Treasury Secretary Scott Bessent said on Fox News that trade talks with China "are a bit stalled." Then Friday morning, President Donald Trump said on Truth Social that China had violated its recent trade agreement with the U.S. He ended the post by saying, "so, much for being Mr. Nice Guy," in a possible foreshadowing of these new restrictions. We all know by now that everything is subject to negotiation with the current administration, and the technology sector is going to be a big focus of upcoming trade talks. The recent episode involving a threatened tariff increase on the European Union — delayed just days later — served as a key reminder not to overreact to individual headlines. But, the market probably needs the U.S. and China to get along for this rally to continue, so we have to stay focused on what the two countries are saying. Economic activity: Following Friday's data releases, the Atlanta Fed's GDPNow tracker was upwardly revised to a gain of 3.8% for the second quarter from its previous estimate of 2.2% on May 27. To be fair, the model isn't always the most accurate predictor of the growth rate of real gross domestic product. On Thursday, the Bureau of Economic Analysis released its second estimate of first-quarter gross domestic product, showing the economy declined 0.2%. That's much better than the GDPNow final forecast of down 2.7% for Q1 (or down 1.5% using the alternative model that adjusts for imports and exports of gold). So, that's our caution about reading too deeply into one model or forecast. Still, the tracker provides a useful gauge of economic momentum, and the fresh data suggest the economy rebounded solidly in the second quarter, with one month remaining. Up next: Two companies in the portfolio are scheduled to report next week: CrowdStrike and Broadcom . Other notable earnings report includes Campbell's, Dollar General, Five Below, and Lululemon. On the economic data side, it's jobs week. That means data on job openings on Tuesday, ADP private payrolls on Wednesday, and the government's nonfarm payrolls report on Friday. Some of the other key reports are ISM manufacturing, factory orders, and durable goods orders. (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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
CNBC
3 days ago
- Business
- CNBC
Why Jim Cramer is frustrated by Friday's lower market — plus, good news for 2 of our bank stocks
Every weekday the CNBC Investing Club with Jim Cramer holds a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Friday's key moments. 1. Wall Street was lower Friday after President Donald Trump said in a Truth Social post that China violated a preliminary trade deal between the two countries, suggesting a tougher stance may be afoot. "We have to literally expect that maybe something happens today, and it just drives me crazy because ... we would have a good market" if not for Trump's threats, Jim Cramer said. Case in point: Stocks temporarily came off their lows after a better-than-expected consumer sentiment survey from the University of Michigan, which showed that respondents' one-year inflation expectations came down from the very high levels seen in prior readings. On top of that, the Federal Reserve's preferred inflation gauge came in mostly aligned with expectations and continued to trend lower. Meanwhile, Jim said he's keeping an eye on headlines out of this weekend's OPEC+ meeting, which could determine where oil prices go next. On Friday, U.S. oil benchmark WTI hovered just above $60 a barrel. 2. Club name Goldman Sachs actually worked on a deal in the oil industry announced Friday — good news for the bank as merger-and-acquisition activity shows further signs of a rebound. The bank is the financial advisor for EOG's $5.6 billion purchase of Encino, while also providing financing. "Deal chatter really, really picked up" after Trump paused his "reciprocal" tariffs in April, Jim said. Shares of fellow Club financial Wells Fargo are slightly lower on Friday after Thursday's 1% gain. On Thursday, the bank confirmed its termination of a 2015 consent order with the Office of the Comptroller of the Currency. The last remaining enforcement action left against Wells for a series of scandals is the Federal Reserve's asset cap imposed in 2018. Thursday's OCC news is a positive sign that we could see the asset cap removed by year-end, said Jeff Marks, director of portfolio analysis. "If you just joined [the Club], buy it," Jim said of Wells Fargo's stock. 3. CrowdStrike and Broadcom are set to report earnings next week on Tuesday and Thursday, respectively. CrowdStrike shares are up a little over 1% Friday, a reaction that Jim said was driven by cybersecurity peer Zscaler's good quarter. With custom AI chipmaker Broadcom, we're also looking forward to seeing the progress its making with cloud software firm VMWare, particularly on gross margins. "The VMware deal has been awesome for them," Marks said. "The stock is up huge since that deal closed." 4. Stocks covered in Friday's rapid fire at the end of the video were: Dell Technologies , Marvell Technology , Ulta Beauty, Gap Inc. , and Airbnb . (Jim Cramer's Charitable Trust is long AVGO,CRWD, GS, WFC . See here for a full list of the stocks.) 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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
CNBC
4 days ago
- Business
- CNBC
Why the stock rally fizzled — plus, our latest thinking on Goldman and Bristol Myers
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. Markets: Stocks rose modestly Thursday but were well off their highest levels of the session. The strong quarter from Club name Nvidia is lifting the broader artificial intelligence trade. As we explained in our earnings commentary Wednesday night, four positive developments have gone Nvidia's way since its annual GTC event in March, fueling additional momentum in its business. The market also got a brief boost after the U.S. Court of International Trade ruled President Donald Trump doesn't have the authority to impose "reciprocal" tariffs on virtually every nation. However, the path forward for this case is unclear, which is why the market's initial gains on the news didn't last. The Trump administration plans to take the case to the Supreme Court on Friday. Tariffs can still be imposed through alternative ways. For example, sector-specific tariffs remain an option, and the president can still invoke Section 232 to impose trade restrictions on the grounds of national security. Bank update: Goldman Sachs President and Chief Operating Officer John Waldron spoke at the Bernstein Strategic Decision Conference on Thursday. Shares were down on the session, underperforming the broader financial sector. The line that may have hit the stock was Waldron explaining that investment banking activity in the second quarter has not been as strong as in the first quarter. It's hard to get deals over the finish line in a highly volatile, uncertain environment like the market dealt with in April. "When you have this kind of volatility, you just fundamentally have a harder time prosecuting transactions that may be in your pipeline, but they don't happen as quickly as you might otherwise expect," Waldron said at the conference. Nobody should have been surprised by Waldron's comments. Peers have said similar things. For example, on May 19, we pointed out that JPMorgan said it expected investment banking fees in the second quarter to be down by a mid-teen percentage year over year. There are two other things to keep in mind: While volatility is bad for mergers-and-acquisition activity, as well as initial public offerings, it is a great thing for Goldman's trading desk. Waldron said Thursday that equity trading client activity has "remained robust" throughout the year, though levels for fixed income, currencies, and commodities (FICC) are now "slightly softer" than the company's strong results this time last year. FICC revenue increased 17% year-over-year in the second quarter of 2024. There has also been a significant pickup in capital markets activity over the past few weeks. We recently highlighted fresh signs of life in the initial public offering (IPO) market. More companies are filing to go public, including Omada Health, expected next week , targeting a market cap of slightly more than $1 billion. Goldman is involved in the Omada deal. This follows last week's IPOs of Hinge Health and MNTN . We're also starting to see more mergers and acquisitions (M & A), with a notable one this week from Club name Salesforce , which agreed to buy Informatica for $8 billion. With one month remaining in the second quarter, we expect muted investment bank fee growth when the banks report earnings in mid-July. However, a stronger second half for Goldman Sachs should be in store, provided the current pause in high tariffs remains in place. Cobenfy comments: Bristol Myers Squibb CEO Chris Boerner tried to assuage investor concerns about the company's key schizophrenia drug, Cobenfy, on Thursday. During the Wall Street Journal's Future of Everything conference, Boerner came to Cobenfy's defense after it failed a key late-stage trial in April that evaluated how it worked when used as an add-on treatment. He argued Thursday that the results "don't have really any impact on the long-term potential" of Cobenfy, explaining the focus has always been to use the drug as a primary treatment. "What we like about Cobenfy is we're seeing efficacy on par with, if not better than, all the existing therapies, but without some of the really onerous side effects," Boerner added, citing impacts from other treatments like significant weight gain. While this was welcomed commentary, the company argued a similar case when it reported earnings in late April. The surprising adjunctive trial result turned what we thought was a straightforward story of a drug with underappreciated potential into a more complicated "show me" situation. And what we need to be shown is better Cobenfy data in future trial readouts. That's why we haven't bought back any of the stock we sold in the low $60s a share earlier this year, as Jim Cramer explained on the Monthly Meeting last week. The stock was up about 1% to around $47 per share Thursday. Asked about the potential for pharmaceutical-specific tariffs, Boerner said that Bristol Myers would prefer the Trump administration take a different direction. But he added he's tried to communicate ways to "do it without messing things up." Whatever the Trump administration does, they have to recognize the "reality of the dynamics of biopharmaceutical manufacturing," he offered. "If you don't get that right, you will end up with supply constraints, and that's something nobody wants, including the administration. Incidentally, it's also why typically when you've had tariffs, pharmaceutical and biotech products have been excluded." Up next: It's another big night of earnings ahead with Club name Costco , Marvell Technology and Dell Technologies scheduled to report. Other companies reporting are Gap , American Eagle Outfitters , Ulta Beauty and Zscaler . There are no major earnings reports after Friday's close. On the data side Friday morning, we get the Federal Reserve's preferred inflation gauge — the personal consumption expenditures price (PCE) index. According to FactSet, PCE is expected to have risen 0.15% month over month in April and 0.12% on a core basis, which excludes volatile food and energy prices. That would mean increases in the headline index and the core of 2.5% and 2.2% year over year, respectively, marking slightly cooler readings than in March. (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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
CNBC
4 days ago
- Business
- CNBC
Jim Cramer says a rare dip in our newest stock may be a buy for new investors
Every weekday the CNBC Investing Club with Jim Cramer holds a "Morning Meeting" livestream at 10:20 a.m. ET. Here's a recap of Thursday's key moments. The S & P 500 was modestly higher Thursday. While cheering Nvidia 's strong earnings and 5% rally in the stock, investors were cautious in the face of new trade policy uncertainty. That uncertainty stems from Wednesday night's ruling by the U.S. Court of International Trade that President Donald Trump does not have the authority to impose his "reciprocal" tariffs. Jim Cramer said the ruling gives countries looking to cut a trade deal with the U.S. some breathing room to wait for a Supreme Court decision. Jim thinks the nation's highest court could side with the trade court. Following Nvidia and Salesforce earnings Wednesday evening, quarterly results from fellow Club name Costco will be our focus after the closing bell. The company does report sales on a monthly basis, so that part is well understood. The question is what do margins look like in an evolving tariff environment? Jim said he wouldn't be surprised if Costco shares were to trade lower following Thursday evening's quarterly numbers. However, he said that, like Club holding TJX , which fell after its earnings but is now coming back, Costco could follow a similar pattern. Jefferies downgraded GE Vernova , our newest stock, to a hold from buy. It was a valuation call after shares surged to record highs. Out of respect for the rally, we downgraded GE Vernova to our hold-equivalent 2 rating on Tuesday. We did, however, raise our price target to $500 per share. Jefferies analysts boosted theirs even higher to $517. GE Vernova shares dropped more than 3% on Thursday after eight straight higher sessions. Jim said this may be a chance to buy for investors looking to start a position because it's been straight up since we initiated it about two weeks ago. Stocks covered in Thursday's rapid fire at the end of the video were: e.l.f. Beauty , Burlington Stores , HP Inc. , and SentinelOne . (Jim Cramer's Charitable Trust is long NVDA, CRM, GEV. See here for a full list of the stocks.) 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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
