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. Green light : Stocks rallied Friday in reaction to Federal Reserve Chair Jerome Powell’s speech at the central bank’s annual Jackson Hole Economic Symposium. While stocks were off their highs of the day by afternoon trading, the market liked how Powell was undeniably dovish, signaling that interest rates would be lowered at the Fed’s policy meeting next month. That’s the box investors wanted to see checked. Here were some of the key lines from Powell’s speech : “The time has come for policy to adjust,” Powell said. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.” “My confidence has grown that inflation is on a sustainable path back to 2%,” he said, referring to the Fed’s target level for inflation. “It seems unlikely that the labor market will be a source of elevated inflationary pressures anytime soon. We do not seek or welcome further cooling in labor market conditions,” Powell said. In recent weeks, Wall Street has placed greater emphasis on jobs data as investors try to gauge the health of the U.S. economy. Jim’s quick takes: Though he’s out Friday, Jim Cramer sent along his observations on Friday’s action. One stock, in particular, that caught his eye is one we’ve been saying for many months is a rate-cut winner: Stanley Black & Decker . The stock added more than 1% in Friday’s session. “Stanley Black & Decker rallying toward $100 ahead of the rate cut is why we stuck by it on every short-term rate spike,” Jim said. “As mortgage rates fall in the months ahead, we are considering other housing-related stocks like Lowe’s that benefit from increased transactions.” Best Buy is another portfolio name catching a bid Friday, up more than 2%. It’s been an up-and-down ride lately for shares of the electronics retailer, which reports earnings next week. “The action in Best Buy shows you how difficult the stock is. The quarter next week could be soft but it’s trading off rate cuts and the idea of strong AI PC sales this holiday season,” Jim explained. Our top-performing stock Friday is solar-tracking technology maker Nextracker , a newer holding that benefits from lower financing costs. No. 2 is a familiar face on performance leaderboards: Nvidia , which announced Friday that its senior engineers will present at the Hot Chips 2024 conference next week. “The series of talks will be on the Blackwell platform and research on liquid cooling for data centers,” Jim said, referring to the leading AI chipmaker’s next-generation platform. “The market will parse through these presentations for clues on the company’s earnings and outlook.” As we’ve seen at various points this summer, political developments may also be influencing moves on Wall Street. “The market liked Powell’s pivot, but the DNC may have mattered too,” Jim said, referring to the Democratic National Convention, which wrapped up Thursday night with a keynote speech from the party’s nominee, Vice President Kamala Harris. “Vice President Harris did not hammer business as much as feared,” Jim said. Up next: It’s a big week on both the economic data and earnings front. The Fed’s preferred inflation gauge, known as the core PCE price index, is due out next Friday. The biggest earnings report of the week, meanwhile, is slated to arrive after the bell Wednesday from Nvidia. As we wrote earlier , this is not the make-or-break report some will make it out to be, but exercising some caution is sensible. Salesforce also is set to report Wednesday night. Best Buy’s results are scheduled for Thursday morning. (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.
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.
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