Every weekday, Jim Cramer’s CNBC Investment Club releases the Homestretch, a practical afternoon update to coincide with the last hour of trading on Wall Street. The S&P 500 was mostly flat on Friday afternoon, but the market continues to expand. For years, the conversation has been dominated by the Magnificent Seven: Apple, Amazon, Alphabet, Meta Platforms, Microsoft, Nvidia, and Tesla. But one of the big themes of the first two trading weeks of the year has been the rotation of these stocks into the rest of the market, including small-cap tech stocks and “hard” economy sectors such as industrials, materials and energy, which tend to perform better as the economy heats up. We’re seeing this play out across the portfolio as Apple, Amazon, Meta Platforms, and Microsoft fell this week. Meanwhile, the biggest gainers in the portfolio were GE Vernova and Eaton (both companies building AI data centers), Qnity Electronics (more on that below), BlackRock (which posted below earnings), Boeing, and Honeywell. Qnity Electronics is one of the technology sector’s biggest gainers, with investors increasingly recognizing that its products are critical components in semiconductor manufacturing, including chip manufacturing, which will account for about half of the company’s net sales in 2024. That’s why our eyes lit up when Taiwan Semi, the world’s largest chip manufacturer and Qnity customer, said it expected a significant increase in capital spending this year. But there was some news worth mentioning on Friday. The company announced that Matt Harbaugh, chief financial officer, will step down from his role and Mike Goss, chief accounting officer and controller, will serve as interim CFO until a permanent replacement is found. The sudden departure of a chief financial officer often makes investors nervous. That creates speculation as to why he or she left. Does the CFO know something that investors don’t? In Qnity’s case, Mr. Harbaugh’s departure was due to health reasons, i.e., non-financial circumstances. Qnity also reassured investors by reaffirming its full-year 2025 net sales and adjusted pro forma operating EBITDA guidance. As a lesson for the future, it’s a red flag if a company doesn’t restate its guidance after a CEO or CFO leaves office. Earnings season is in full swing next week, with the announcement of 29 S&P 500 companies. Within the portfolio, you’ll hear from Procter & Gamble before the opening bell on Thursday and from Capital One Financial after the closing bell. Other notable companies reporting are DR Horton, 3M, Netflix, Johnson & Johnson, Halliburton, Schwab, Prologis, Teledyne, GE Aerospace, Abbott Labs, McCormick, Intel, Intuitive Surgical, CSX Corp, Freeport-McMoRan, and SLB. (See here for a complete list of Jim Cramer Charitable Trust 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.
