The S&P 500 hit a wall on Friday, ending the week lower just one day after closing at a record high. The rotation of tech stocks that supported the Dow was on full display. Wednesday’s all-out rally after the Federal Reserve cut interest rates for the third time this year has long been forgotten. .SPX .IXIC,.DJI 5D Mountain Last week’s S&P 500, Nasdaq, Dow Over the week, the broader market S&P 500 fell about 0.6%, while the tech-heavy Nasdaq fell 1.6%, ending a two-week winning streak. A sector shuffle, with weekly winners in materials, financials and industrials and weekly losers in communications services and information technology, pushed the Dow up 1% last week, its third consecutive week of gains. Despite December being a historically strong month, the S&P 500 and Nasdaq fell 0.3% and 0.7%, respectively. The Dow Jones Industrial Average rose nearly 1.6%. Perhaps the big man will bail out Wall Street. The so-called Santa Claus Rally begins on December 19th, with a seasonal pattern that occurs on the last five business days of the year and the first two business days of the new year. Until then, here are the four key moments that moved the market last week. 1. Broad(com) Concerns The market was dominated by a sell-off in tech stocks on Friday, led by Broadcom’s 11.5% plunge. The semiconductor maker’s quarterly results on Thursday were overshadowed by management’s misleading statements on its earnings call. The Broadcom attack has ignited concerns about smoldering AI stock valuations. Jim Cramer said during Friday morning’s drop that the custom chip maker’s business is “strong” and that the drop could be a buying opportunity. Broadcom was the worst performer this week, followed by Meta Platforms and Nvidia. 2. Wounded Oracle Oracle’s second trade on Friday didn’t help. Shares fell nearly 11% on Thursday after a disappointing quarterly revenue update, a disappointing outlook update and an increase in spending guidance. The magnitude of the stock price decline was compounded by something management didn’t mention on Wednesday night’s conference call: OpenAI’s ability to deliver on its massive commitment to buy AI computing power from Oracle. On Friday, the stock fell another 4.5% after Bloomberg reported that Oracle was pushing back the completion date of some data centers being completed for OpenAI. Oracle pushed back, insisting that “all milestones are on track.” 3. Nvidia gets OK from China While Nvidia caught some flak from AI trade concerns, the king of multipurpose artificial intelligence chips received some much-awaited good news last week. After trading closed on Monday, President Donald Trump said on social media that Nvidia would be allowed to ship its second-best H200 chip to “authorized customers in China” and the U.S. government would receive a 25% tax break. Nvidia reached an agreement with the US government in August to provide 15% of H20 sales with reduced production to China in exchange for export licenses. It turns out that China did not want the H20s. The question of whether China wants H200 has been debated all week. 4. Strong Guidance On the industrial side of AI trading, GE Bellnova was the top performer despite a 4.6% decline on Friday. The energy equipment company, which provides products and services to power AI data centers, received incredibly positive guidance through fiscal 2028, and closed at a record high on Wednesday. CEO Scott Strzyk on CNBC further emphasized the compelling short- and long-term growth story that management outlined during Tuesday night’s investor conference. On Wednesday, we raised our price target on GE Vernova from $700 to $800 per share and reiterated our rating of 1, equivalent to Buy. Honeywell spinoff Solstice Advanced Materials and Dover were also weekly winners. (Jim Cramer’s charitable trusts are long AVOG, META, NVDA, GEV, SOLS, DOV. See here for a complete list of stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive trade alerts before Jim makes a trade. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in his charitable trust’s portfolio. If Jim talks about a stock on CNBC TV, he will issue a trade alert and then wait 72 hours before executing the trade. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
