Every weekday, the CNBC Investing Club with Jim Cramer does a live “morning session” at 10:20am ET. Here’s a recap of Friday’s highlights. Market action this week reaffirmed oil as a hedge Quick mentions: AAPL, QCOM, JNJ, DHR We want an update on Cisco’s supply chain woes 1. Market action this week has steadied oil as U.S.-hedge West Texas Intermediate crude futures fell on Friday after settling higher on Thursday. We believe Thursday’s gain may have been one of the reasons for Thursday’s intraday market reversal, which started strongly after a positive inflation report but then gave up its gains. Also worth noting: the market appears to be overbought, perhaps after Wednesday’s big rally. The S&P 500 short-range oscillator, which is the Club’s most reliable indicator of when the market should pull back or bounce, hit 5.55% after Thursday’s session. The move in oil this week reaffirms our decision to hold oil as a hedge. It worked in our favor on days like Thursday when stocks were down but oil managed to rally. Now that oil is down and stocks are up, the Club’s other non-oil holdings are coming into play. 2. Quick Mentions: AAPL, QCOM, JNJ Apple (AAPL) has told its suppliers to build at least the same number of iPhones this year as in 2021, according to Bloomberg. That’s interesting considering that worldwide smartphone shipment demand fell 9% in the second quarter from a year earlier. While iPhone shipments were still strong, Apple supplier Foxconn recently warned that demand for smartphones is waning. However, we heard from Qualcomm ( QCOM ) that the slowdown in demand mainly affects lower-end phones, while demand for premium 5G smartphones is stronger. This could mean that Apple is banking on its wealthier clientele, something to watch out for. Drug stocks fell on Thursday on concerns of exposure to a lawsuit related to the heartburn drug Zantac, which was pulled from US markets in 2020 after cancer-causing impurities were found in samples of the drug. Although Club Holding Johnson & Johnson (JNJ) does not appear in the litigation, its stock still took a hit. However, we think that was an overreaction. 3. We are looking for an update on Cisco Cisco (CSCO) reports next week and want an update on supply chain issues. The company posted lower-than-expected revenue in its most recent quarter and called for a surprise sales decline in the following period. The company cited factory closings in China as pressure on component supplies. We recently cut our position and downgraded our rating to a 2 after Arista Network (ANET) reported a surprising pace in the final quarter last week, prompting our concern that it is being pulled market share in Cisco. We don’t know what to do with Cisco yet, as we have no visibility into their supply chain, but we’ll look for answers when they report back. (Jim Cramer’s Charitable Trust is long AAPL. CSCO, JNJ, QCOM. See a full list of stocks here.) As a subscriber to the CNBC Investing Club with Jim Cramer, you’ll receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a share in his charitable trust portfolio. If Jim has discussed a stock on CNBC TV, wait 72 hours after issuing the trade alert before executing the trade. THE INFORMATION IN THE ALTERNATE INVESTMENT CLUB IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, WITH OUR DISCLAIMER. NO OBLIGATION OR FIDUCIARY DUTY EXISTS OR IS CREATED BY YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTOR CLUB. NO SPECIFIC RESULTS OR BENEFITS ARE GUARANTEED.
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