The CNBC Investing Club with Jim Cramer released its weekly update, Homestretch, which provided insights into market trends and stock performance. Here’s a summary of the key points:
Stocks are off to a higher start after last week’s S&P 500 dip, but market breadth remains poor. The “Magnificent 7” stocks, excluding Nvidia, continue to drive the index higher.
In the consumer sector, China-related stocks took a hit due to disappointing economic numbers. Starbucks saw its shares drag due to weak retail numbers, but CEO Brian Niccol’s efforts to revamp the US business may help stabilize the stock.
China’s National Bureau of Statistics reported a 3% increase in retail sales in November, missing the forecast of 4.6%. This news has raised concerns about the country’s economic outlook.
Meanwhile, Broadcom surged 24% last week and is now one of the biggest gainers in the market. Despite being technically oversold, the company’s rapid price appreciation has pushed its position size to a large portion of the portfolio.
The Investing Club downgraded Broadcom’s rating to 2 due to concerns about its rapid price growth. However, the team remains bullish on the long-term AI outlook and plans to sell some shares and reinvest the proceeds in Advanced Micro Devices (AMD), which is struggling due to competition from custom AI chips.
No major earnings announcements are scheduled for Monday or Tuesday. On Wednesday, the November retail sales report will be released, providing insights into holiday spending and consumer sentiment.
Source: https://www.cnbc.com/2024/12/16/were-downgrading-broadcom-after-shares-go-parabolic-a-rival-is-a-buy.html