Every weekday, the CNBC Investing Club with Jim Cramer releases Homestretch — an actionable afternoon update, just in time for the final hour of trading on Wall Street. (We are no longer recording audio, so we can get this new written feature out to members as quickly as possible.) Good News is Good News: The stock market has correctly viewed good jobs data as good news — no matter what it means. For the timing of the first interest rate cut from the Federal Reserve. Some may worry that a still-tight labor market is leading to hyperinflation. But the reality is that strong job gains with high but moderate wage growth is a great scenario for the US economy. If the market needed the Fed's first rate cut after a tightening cycle so badly, why did the rise go so little? A lack of news can also be good news: Friday's market rally has an impact on more than just jobs numbers. It thrives due to the lack of new escalation in the Middle East. These concerns were the catalyst that caused oil prices to rise late Thursday and the stock market to rise. We must monitor the Middle East and the oil dynamics. More importantly, the reversal that occurred Thursday afternoon had nothing to do with the Fed. Our advice is to dismiss the day-to-day Fed talk and just focus on what Fed Chairman Jerome Powell is saying. Powell said this week that interest rate cuts will come when needed, but central bankers will need more time to figure that out. This is no different from what he's said before, and it's consistent with what Jim Cramer and I have been saying for a while. Ford gets a surprise: Morgan Stanley auto analyst Adam Jonas raised his price target on the Ford club name to $17 per share from $16. The move comes in response to the automaker's announcement on Thursday that it would postpone production of its all-electric SUV and pickup truck to focus on its more profitable and in-demand hybrid offerings. Jonas believes slower adoption of electric vehicles is great for legacy American automakers like Ford. We agree. Ford's evolving plans to produce fewer electric vehicles means narrowing losses and reducing capital expenditures. This has had a positive impact on earnings, and we know that stocks tend to move in the direction of earnings. The focus of Ford's strategy should also be to enhance free cash flow, increasing the potential for greater cash returns for shareholders. While Ford has preferred to return its excess cash through a special dividend, we'd prefer to see more buybacks next time around as the stock trades at just seven times forward earnings and already pays a huge dividend. General Motors' timely buyback last November did wonders for the stock price. Weekly Best Performing Stocks: The four best performing stocks in the portfolio this week are Meta Platforms, Eaton, Wynn Resorts, and Amazon. Meta was also one of the biggest gainers in the S&P 500, buoyed by a lot of positive commentary on how it is gaining ad market share with its generative AI tools. Eaton rose thanks to multiple analyst upgrades. Wynn Resorts rose Monday on better-than-expected overall gaming revenue data in Macau. Wynn stock outperformed the selloff on Thursday thanks to Mizuho initiating coverage with a buy rating and a price target of $131 per share. Amazon rose on a number of positive notes – hitting a new 52-week high on Friday and trading back to levels last seen in 2021. Worst Weekly Performance: The four worst-performing stocks in the portfolio are Foot Locker, Estée Lauder and Palo Alto Networks. and TJX Companies. It's no coincidence that we see three retail stocks on this list. Retail ETFs (XRT) suffered their worst weeks in more than a year on weak earnings from PVH, a minor update from Ulta Beauty, and gasoline prices hit a six-month high. The thing about a major retail decline like this is that it tends to bring down the good with the bad. Costco and TJX should hold up better because they are market share winners and offer great value to their customers. Both stocks look like opportunities to us. Palo Alto Networks' performance declined despite a lack of specific news, and we are considering whether to add further to our position on this recent weakness. (See here for a complete list of stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you'll receive a trade alert before Jim takes a trade. Jim waits 45 minutes after a trade alert is sent before buying or selling a stock in his charitable fund's portfolio. If Jim talks about a stock on CNBC TV, he waits 72 hours after the trade alert is issued before executing the trade. The above Investment Club information is subject to our Terms and Conditions and Privacy Policy, as well as our Disclaimer. No obligation or fiduciary duty exists or is created by your receipt of any information provided in connection with the Investment Club. No specific results or profits are guaranteed.
Every weekday, the CNBC Investing Club with Jim Cramer releases Homestretch — an actionable afternoon update, just in time for the final hour of trading on Wall Street. (We are no longer recording audio, so we can get this new written feature to members as quickly as possible.)
