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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. Manic Monday : U.S. stocks were getting slammed to start the new week, with the Dow down more than 1,000 points or 2.5%, the S & P 500 down over 3%, and the Nasdaq down more than 4.5%. A sharp drop in bond yields wasn’t even helping. Economic fears gripped Wall Street after President Donald Trump went on Fox News Sunday but didn’t rule out a tariff-induced recession. He also said he needs to build a “strong country” and “can’t really watch the stock market.” The worst sectors Monday were information technology, led lower by Club names Nvidia and Apple , and communications services, led lower by Club names Alphabet and Meta Platforms . Financials were also taking a hit: Wells Fargo was the portfolio’s worst performer and Goldman Sachs was not too far behind. Health care, which has recently been strong, was pretty flat Monday, but Club names Bristol Myers Squibb and Abbott Laboratories were both solidly in the green. Trade tracker: Our approach on Monday has been the same as last week’s flurry of activity – target beaten-up stocks that still have strong fundamental outlooks, while opportunistically trimming outperforming names that have benefited from the market rotation into defensively oriented pockets. Friday’s rally snapped the S & P 500 Short Range Oscillator out of oversold territory for the first time in four sessions. But Monday’s avalanche of selling will likely put the Oscillator right back into oversold. We started Monday’s session with a purchase of CrowdStrike , which has come under heavy selling pressure after providing light guidance for its current fiscal year alongside earnings last week. We followed that up by locking in profits on Abbott, a clear winner from the market rotation, and Linde, which has proven resilient so far this year. We used a portion of those funds to buy more of Goldman, as shares of the investment bank hovered around 20% below their highs reached last month. We used more of the cash we raised Monday morning to scale deeper into our newest position, Capital One Financial . We initiated a stake last Thursday and bought some on Friday, too. We also added to our Disney position, in what will likely be our last trade of the day . We think Disney has a good chance of weathering any slowdown in the consumer. Google news : Shares of Alphabet sank nearly 5% on Monday after the DOJ filed a revised proposed final judgment in its antitrust litigation against the Google parent with only minor changes, mostly retaining the remedies proposed by during President Joe Biden ‘s term. The Trump DOJ reaffirmed the agency’s request for Google to sell its Chrome browser, a key gateway for the company’s search services and advertising business, but is no longer compelling Google to sell its artificial intelligence investments, such as its stake in OpenAI competitor Anthropic. Still, Alphabet will be required to notify regulators before making more AI investments. Regulators kept their remedy to ban payments to distribution partners like Apple and Android manufacturers. The ongoing litigation remains a major overhang for Alphabet stock since the outcome could impact Google’s business model and market dominance. Google has long argued that too much regulation could impact its ability to compete. Many investors assumed that Trump’s administration would take a less aggressive stance on antitrust measures against Big Tech, given he’s generally viewed as having a pro-business stance. It’s hard to forget the prominent attendance of tech CEOs at the inauguration, including Alphabet CEO Sundar Pichai, Meta CEO Mark Zuckerberg, and Amazon founder Jeff Bezos, which may have suggested improved relations between Trump and those companies. Yet, MoffettNathanson said the DOJ’s latest proposal “shouldn’t be a surprise,” citing the Tunney Act, which claims that the settlement of antitrust cases serves public interest and “prohibits any change of heart” for the DOJ. Although the government “gave a small bit of ground” for Google to continue its AI investments, the antitrust case “isn’t just going away,” analysts said. In a note to clients Monday, JPMorgan said the DOJ’s remedies “do not provide Google with the relief that many investors had hoped for under the new administration.” Jim Cramer has been cautious about Alphabet, which dropped 13% year to date, and the long-term risks the antitrust cases pose to its business. While acknowledging the company’s dominance in search and advertising, Alphabet is far from being a bad actor. Jim has suggested that Alphabet’s strong market position may not warrant legal action since advertisers can always find other companies to advertise with. At the same time, Jim struggles to see Google Search’s potential as chatbot adoption keeps accelerating. However, the Club is balancing those concerns with Alphabet’s strength in AI, cloud computing, and YouTube. Up Next : No companies in the portfolio are scheduled to report. Oracle is the biggest name scheduled to report, and we’ll be interested to see what co-founder Larry Ellison and company have to say about AI demand and investment. Others reporting after the bell are Mission Produce and Vail Resorts . Before Tuesday’s opening bell, we’ll see earnings from Dick’s Sporting Goods , Kohl’s , and Viking. On the economic data side, the key reports are small business optimism from the National Federation of Independent Business (NFIB) and the government’s latest Job Openings and Labor Turnover Survey, or JOLTS as it’s commonly known. — CNBC’s Kevin Stankiewicz and Jeff Marks contributed to this report. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) 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.
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.
