The bulls got what they wanted this week: cooler inflation data and record highs. The Dow Jones Industrial Average closed above 40,000 for the primary time on Friday, capping a 1.24% gain for the week. The S&P 500 and Nasdaq Composite, meanwhile, closed at all-time highs on Wednesday, boosted by weaker-than-expected inflation data released before the bell that day. Indices showed tame but inconsistent moves on the last two trading days of the week; Both ended Friday barely below their highs from Wednesday. The S&P 500 gained 1.54% for the week, while the tech-heavy Nasdaq gained 2.1%. The market moved into extremely overbought territory throughout the week, forcing the club to take care of our discipline. We reduced our positions in Morgan Stanley and Palo Alto Networks on Wednesday and Thursday, respectively, after each stocks rose significantly. On the opposite hand, we bought additional shares of Estee Lauder on Tuesday after seeing some positive signals from the cosmetics retailer’s key Chinese market. Here’s a more in-depth have a look at what drove the moves within the portfolio’s top five stocks this week. PANW YTD Mountain Palo Alto Networks (PANW) Year-to-Date Performance Palo Alto Networks landed at No. 1 with weekly gains, rising 6.9% for the period. The cybersecurity stock had a very strong session on Wednesday, gaining 3.57% after Morgan Stanley gave one other positive view of the corporate ahead of its quarterly earnings report on Monday evening. The stock got an extra boost Thursday from news of a stronger partnership with IBM that may give Palo Alto access to a bigger customer base. Palo Alto has delivered significant outperformance for the reason that starting of April, which was reflected in our Trim Thursday. We remain optimistic for Palo Alto in the long run. DHR YTD Mountain Danaher (DHR) Year-to-Date Performance Danaher rose 4.9% for the week to secure second place. Shares are riding a four-session winning streak and hitting a series of 52-week highs, including on Friday. The stock is now trading at levels last seen in October 2021. The biggest catalyst this week was the corporate’s positive presentation Tuesday at a Bank of America healthcare conference. CEO Rainer Blair reiterated what was said in a better-than-expected quarterly earnings report in April and offered encouraging comments about destocking within the bioprocessing business. Danaher’s recent rise – up 11% within the last month – shows the advantages of staying invested in a well-run company that’s managing its inventory problems. AVGO YTD Berg Broadcom’s (AVGO) stock performance year-to-date. Broadcom got here in third with a gain of 4.7% this week. Its strong performance included a record closing price of $1,436.17 per share on Wednesday. There was no single catalyst for Broadcom’s advance this week. But artificial intelligence-related announcements from ChatGPT maker OpenAI on Monday and later at Google’s I/O developer conference can have boosted the chipmaker’s stock (more on Google in a moment). Broadcom has been a giant beneficiary of AI trading in 2024: shares are up 25% year-to-date, while the S&P 500 is up 11.2%. Broadcom helped develop Google’s internal AI chip for years. GOOGL YTD Mountain Alphabet (GOOGL) Year-to-Date Performance Alphabet landed at No. 4 with gains as shares gained 4.4% this week. The stock closed at record highs for 3 consecutive sessions, sparked by Alphabet-owned Google’s annual I/O developer conference on Wednesday. Management unveiled quite a lot of recent generative AI products on the event, renewing investor confidence in Alphabet’s position within the heated AI arms race despite quite a few setbacks since ChatGPT’s launch in late 2022. Wall Street analysts expressed optimism concerning the updates and we’re also pleased with what we have now heard. AAPL YTD Mountain Apple (AAPL) Year-to-Date Performance Apple rounded out the highest five, with shares rising 3.7% over the period. It’s difficult to attribute Apple’s performance to a single event. But for the reason that release of the corporate’s quarterly earnings report on May 2, the tech giant has been on an upswing, rising nearly 10% after management delivered an increase in sales and profits despite concerns about its business in China. The iPhone maker also announced its largest corporate buyback ever, with stock buyback authorization value a whopping $110 billion. Investors have also received several signs recently that Apple is taking AI more seriously. Recent updates from OpenAI and Google could also boost sentiment, as previous reports suggested the iPhone maker may partner with either for its latest iPhone software system. (Jim Cramer’s Charitable Trust is Long PANW, MS, EL, DHR, GOOGL, AVGO, AAPL. See a full list of stocks here.) As a subscriber to 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 stock in his charitable foundation’s portfolio. If Jim discussed a stock on CNBC television, he waits 72 hours after the trade alert is issued before executing the trade. THE INVESTING CLUB INFORMATION SET FORTH ABOVE IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, ALONG WITH OUR DISCLAIMER. THERE ARE NO fiduciary duty or duty IN RECEIVING YOUR INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
Traders work on the ground of the New York Stock Exchange (NYSE) in New York City, USA, May 15, 2024.
Brendan McDermid | Reuters
The bulls got what they wanted this week: cooler inflation data and record highs.
