Wall Street rose this week in a holiday-shortened session, with the S&P 500 and Nasdaq both dropping some after hitting all-time highs earlier in the week. The S&P 500 and Nasdaq were able to finish the week with modest gains. The Dow, whose gains had cooled off recently, was the big winner this week. Nvidia was the big story this week, surging to an all-time high on Tuesday and overtaking Microsoft as the most valuable company in the U.S. However, back-to-back sharp declines on Thursday and Friday dropped Nvidia to third place, with club name Microsoft reclaiming the top spot, followed by Apple. Nvidia had a strong run for a few days after its 1-for-10 stock split traded on the market on June 10. This strength looked to continue into last week, with profit-taking coming in. In fact, the market retreated from AI trading on Thursday and Friday. We sold some shares on Tuesday because we didn’t want to lose gains on another semiconductor giant in our portfolio, Broadcom. Despite three straight declines, including Friday, Broadcom was up about 13% from the trading day before its jaw-dropping earnings announcement this month. The S&P 500 information technology sector was flat throughout the week, reflecting the sudden change in the AI ​​trade. Energy was the best performing sector as U.S. crude oil prices surged. West Texas Intermediate crude oil had its best week since early April. Consumer Goods, Capital Goods and Financials were also strong. Utilities and Real Estate were the only two sectors to decline throughout the week. Last week also saw the release of several important economic reports. On Tuesday, the stock market took the weaker-than-expected May retail sales numbers in stride, likely due to the belief that the weakness will bolster the view that the Federal Reserve will actually cut interest rates later this year. May industrial production and capacity utilization, released on Tuesday, came in above expectations, suggesting that the economy remains resilient, even if consumers are holding back a bit. The market was closed on Wednesday for Juneteenth. Housing data to close the week was mixed, with May housing starts on Thursday showing a bit of weakness and May existing home sales on Friday coming in slightly stronger than expected. After all, last week’s economic data showed that while U.S. growth remains strong, things are slowing, which is an ideal situation for stock market bulls. Continued economic expansion, with low interest rates expected if inflation continues to subside, will drive stock prices higher. The Fed’s favorite inflation metric and the end of earnings season will be what drives markets over the coming week. Economy The most important number next week is the core personal consumption expenditures (PCE) price index, the central bank’s favorite inflation metric. It will be released on Friday. The consensus forecast for May is for a 2.6% annual increase in both headline PCE and core rates (which exclude volatile food and energy prices), according to FactSet. These numbers are roughly in line with the year-over-year increases for each month since the beginning of 2024. The day before the PCE data, the final first quarter gross domestic product (GDP) will be released. While this is the highest level outlook for the US economy, it is important to note that the GDP release is extremely delayed. After all, the second quarter is nearing the end. The latest housing data will be released on Tuesday, Wednesday, and Thursday. Because housing costs are the largest single component of the inflation price basket, these reports can be used to get a sense of the direction of home prices, and therefore inflation overall. Earnings While there are no club company earnings reports over the next week, there are notable earnings from outside the portfolio that should be considered. FedEx: This delivery company has a huge impact and importance on so many industries, so management is uniquely positioned to provide a higher level view of economic activity. They also deliver a lot of packages, so they can provide insight into consumer online shopping activity. If broader consumer and economic activity is indeed stabilizing, we should see that in shipping volume trends. Carnival, Levi Strauss, Nike: Looking at these three companies, we can get a better understanding of consumer spending activity and where they are spending their money. Are they still focused on experiences (Carnival) or are spending shifting back to goods (Nike and Levi Strauss)? Paychex: This company is the largest payroll processor in the nation, with a focus on small and medium-sized businesses. It is uniquely positioned to provide insights on the state of the labor market. The U.S. is a consumption-driven economy, so low unemployment speaks to sustained purchasing power. This is key to the Fed’s ability to fight inflation while hopefully avoiding a recession. Micron: We’ll be getting as much insight as we can on the state of data centers and AI data center buildouts. Micron may not be as directly involved in AI as NVIDIA or Broadcom, but the company’s memory chips are needed to build these data centers. What Micron’s management is looking at will help us get a better understanding of where they are in the current investment cycle and how much room they have. We expect it will be several more quarters before demand for data center infrastructure solutions subsides.Micron’s insights into the PC and smartphone markets will also give us better information about the state of refresh cycles for Apple, Broadcom’s wireless business (almost all of which is Apple products), and consumer electronics, which is key to our Best Buy investment thesis. Monday, June 24th No major events Tuesday, June 25th Before the Bell: Carnival (CCL) After the Bell: FedEx (FDX) Wednesday, June 26th 10:00 AM ET: New Home Sales Before the Bell: General Mills (GIS), Paychex (PAYX), Unifirst (UNF) After the Bell: Micron (MU), BlackBerry (BB), Levi Strauss & Co. (LEVI) Thursday, June 27th 8:30 AM ET: Initial Unemployment Claims 8:30 AM ET: Gross Domestic Product 10:00 AM ET: Home Sales Pending Before the Bell: Walgreens Boots Alliance (WBA), McCormick (MKC) After the Bell: Nike (NKE), American Outdoor Brands (AOUT) Friday, June 28th 8:30 AM ET: PCE Price Index (For a complete list of Jim Cramer Charitable Trust stocks, click here.) If you join Jim Cramer’s CNBC Investment Club as a subscriber, you will receive a trade alert before Jim makes the trade. Jim will buy or sell stocks in the Charitable Trust’s portfolio 45 minutes after sending you a trade alert. If Jim talks about a stock on CNBC television, he will execute the trade 72 hours after issuing a trade alert. The above Investment Club information is subject to our Terms of Use and Privacy Policy, as well as Disclaimers. No fiduciary duty or liability is created by receipt of any information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
Shoppers walk inside Twelve Oaks Mall on November 24, 2023 in Novi, Michigan.
Emily Elconin | Getty Images
Wall Street rose in this holiday-shortened trading week, S&P 500 and Nasdaq Both indexes retreated slightly after hitting all-time highs earlier in the week, with the S&P 500 and Nasdaq finishing the week slightly higher. DowIt’s been slowing down recently, but it was this week’s big winner.
