What we're watching Friday — jobs still strong, Costco sales beat, Buffett ups oil exposure

Published Fri, Jul 8 20229:03 AM EDTUpdated Fri, Jul 8 20229:11 AM EDT

What the Club is looking at July 8, 2022 Labor market still showing strength after a better than expected nonfarm payroll report for June with 372,000 jobs added versus 250,000 expected, offset by negative 74,000 revisions for April and May. Average hourly earnings June were a tick higher than expected at 5.1% year over year, but a hair lower from the prior month's increase. Labor force participation rate at 62.2%, down from 62.3% in May. The 10-Year Treasury yield rose in response to the strong report, back above 3%. The Elon Musk-Twitter saga continues after The Washington Post reports the deal could be in jeopardy. Twitter (TWTR) spoke to reporters Thursday about its method for counting spam bots. Cybersecurity favorite Palo Alto Networks (PANW) price target increased to $650 per share from $615 by BMO Capital. Costco (COST), a Club holding, reports June monthly sales: U.S. core comps up 13.2% versus 12.8% expected; total company comps up 13% versus 11.1% expected. Oppenheimer raises price target to $535 per share from $525. Warren Buffett's Berkshire Hathaway (BRK.a) can't stop buying shares of Occidental Petroleum (OXY). Adds another 12 million shares in between July 5 and July 6, increasing its stake to 18.7%. Upstart (UPST) preannounces weaker-than-expected second quarter, citing a tight funding environment and the sale of some loans for cash. Shares plunge 17% in the premarket. The cloud-based artificial intelligence lending platform expects revenue to be $228 million versus guidance of $295 million to $305 million. Net loss expected to be in the range of $31 million to $27 million versus prior guidance of a $4 million loss to breakeven. JMP downgrades to market perform, Bank of America cuts price target to $34 per share from $41. Jim Cramer highlighted the challenges Upstart and companies in the Buy Now, Pay Later industry face in a rising interest rate environment on Wednesday's "Mad Money." XPO Logistics (XPO) upgraded to overweight by Morgan Stanley, which keeps price target at $75. Calls the stock "too cheap to ignore." Walgreens Boots Alliance (WBA) price target lowered to $45 per share from $52 by JPMorgan. Morgan Staley likes PepsiCo (PEP), expects a sales and earnings beat with a reiteration of guidance. Jim highlighted Coca-Cola (KO) on "Mad Money" on Thursday . Barclays cuts their price targets on a handful of industrials: 3M (MMM) to $143 per share from $146, Stanley Black & Decker (SWK) to $140 from $149, Illinois Tool Works (ITW) to $167 from $180 (also downgraded by UBS), Emerson Electric (EMR) to $80 from $87, General Electric (GE) to $81 from $96, and Club holding Honeywell (HON) to $204 from $220. Piper Sandler lowers Club holding Microsoft (MSFT) price target to $312 from $352 after reducing estimates further to account for the strong U.S. dollar. Club members may notice our cash position is $6,029 lower Friday morning from Thursday. This is due to administrative fees paid out by Jim's Charitable Trust. (Jim Cramer's Charitable Trust is long COST, HON and MSFT. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

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What the Club is looking at July 8, 2022

Labor market still showing strength after a better than expected nonfarm payroll report for June with 372,000 jobs added versus 250,000 expected, offset by negative 74,000 revisions for April and May.

Average hourly earnings June were a tick higher than expected at 5.1% year over year, but a hair lower from the prior month's increase.
Labor force participation rate at 62.2%, down from 62.3% in May.
The 10-Year Treasury yield rose in response to the strong report, back above 3%.