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. MARKET UPDATE: Stocks are up on Friday, with the S&P 500 trading at record highs, extending its gains to about 2% this week. Markets are shaking off concerns about a potential trade dispute with Canada on Friday after President Donald Trump announced he was ending negotiations with the country. Rather, the market rose as September’s CPI was slightly weaker than expected. The report brought a sigh of relief, allaying fears that the economy was facing the double whammy of a weakening labor market and reaccelerating inflation. Based on September’s consumer price index (CPI), the market expects the US Federal Reserve (Fed) to cut interest rates by 25 basis points (bp) next week. Bank stocks are rising today on hopes that lower interest rates will stimulate economic activity. Earnings Scorecard: Nearly a third of S&P 500 stocks report earnings, so the results so far have been pretty good. Approximately 82% of companies that reported exceeded revenue expectations, and approximately 87% exceeded profit expectations. According to LSEG, this beat rate is higher than the typical beat of 62% sales and 67% profit. Double beats (companies outperforming on both revenue and profits) are also occurring more frequently. Nearly three-quarters of the companies we’ve reported to date have achieved this feat. This compared to approximately 69% and 54% in Q2 and Q1, respectively. Next week: The quarter results were good, but next week is the real test. This week is earnings week, with more than 150 S&P 500 companies and 10 portfolio stocks scheduled to report. Within the portfolio, you’ll hear from Corning, Boeing, Starbucks, Meta Platforms, Microsoft, Bristol Myers, Eli Lilly, Amazon, Apple, and Linde. This week is also Fed week, with the two-day Federal Open Market Committee concluding with an interest rate decision on Wednesday. The market has seen a 25 basis point (bp) rate cut as a de facto lock, but traders will want to know whether a December rate cut is also on the table. On trade, President Trump is scheduled to meet with Chinese President Xi Jinping in South Korea next Thursday. (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.
