Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. (We're no longer recording the audio, so we can get this new written feature to members as quickly as possible.)
What's new since the Morning Meeting: If you only looked at the S&P 500 and noticed it was little changed Monday, you may think it was a quiet day in the market. However, there's still plenty happening underneath the surface. Pullbacks in Club holdings Apple and Alphabet, as well as Tesla, weighed the S&P 500 down, but there was still plenty of strength in semiconductors and anything tied to artificial intelligence, such as the industrials integral to the construction of data centers needed to power generative AI workloads.
Nvidia, the leading AI chipmaker, surged nearly 6% Monday. Shares were already heading higher into the company's afternoon presentation at a Morgan Stanley tech conference. However, the stock took another leg higher as CFO Colette Kress made it clear that despite all Nvidia is doing to ramp up supply, there is still not only a ton of unmet demand for the currently available H100, but also strong demand for its next-generation AI chips such as the H200 and B100.
Apple shares fell over 2% Monday. "We can't get Apple right every day, but we can accept that it can go down and recharge," Jim Cramer said Monday. "I believe this is really about how the Samsung phone is now superior to the Apple iPhone because of its [multiple] gen AI properties that make it so it is red hot at Best Buy."
Alphabet's slide "was only a matter of time," Jim added. "It is why we haven't pounded the table one bit on it and have been very critical. I would say that the decline could wake up management to the possibility the market has had it with their lassitude. It is time to get serious there and they aren't serious."
Tesla may be lower, but its decline had no impact on Ford Motor after the Club name reported strong February sales. "Ford is in breakout mode and numbers have to go higher," Jim said.
Meanwhile, some are looking at the ongoing momentum in AI server maker Super Micro Computers as a warning sign that these stocks have moved too far too fast.
"Is the Nasdaq getting too hot? I know that parts are, and we have no inclination to buy a short pullback except Palo Alto Networks if it does pullback," Jim said, referring to the cybersecurity company that we've owned for the past year.
Elsewhere, the food stocks are getting hurt Monday, but, unlike last year when weakness in the cohort pushed down other consumer staples such as Club name Procter & Gamble, the maker of Tide detergent and Crest toothpaste "is recognized as not being a food [stock]," Jim said. Shares of P&G rose about 0.2% Monday, to $159.20 each.
Banks jump: Our two banks are having a strong day, with Wells Fargo making a new all-time high, up nearly 2%, and Morgan Stanley among Monday's leaders in the S&P 500, jumping more than 4%. It's hard to pinpoint the exact cause of Morgan Stanley's strength, but one reason could be a bullish note from Jefferies. The analysts said the bank is "moving past deal integration and toward cross-firm connectivity, with a focus on the large [wealth management] opportunity already embedded in its existing client base and more collaboration across its three business segments." We've held onto Morgan Stanley for the coming rebound in investment banking activity, but progress toward its Wealth Management division hitting its goals of $1 trillion in net new assets every three years and 30% margins is the main driver of the stock. However, investors were dealt a setback last quarter after management acknowledged margins will consolidate in the mid-20s. The market needs to regain an appreciation for this business in order for the stock to make its way back near $100 per share. With Monday's pop, the stock is trading around $90.30 per share.
Up next: Don't forget Coterra Energy CEO Tom Jorden is on "Mad Money" on Monday night. Tuesday morning features Target earnings and a slew of economic data, including S&P Global US Services PMI, Durable Goods orders, and ISM Services Index.
(See here for a full list of the stocks in Jim Cramer's Charitable Trust.)
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