The Club’s top 10 things to watch in the stock market Tuesday
The Club’s top 10 things to watch Tuesday, June 23 – Today’s newsletter was written by Jeff Marks, the Club’s director of portfolio analysis. 1. Nasdaq futures are down about 2.5% this morning. While the 10% decline in the South Korean stock market was also reflected in the US markets, semiconductors and artificial intelligence-related stocks were the ones that experienced the biggest decline. The pullback comes after the Nasdaq fell 1.3 percent yesterday; This decline was driven by hyperscaler stocks as concerns grew about the returns on AI spending. 2. Bank of America raised its price targets in the chip space, increasing Club Name Arm’s hold rating from $335 to $460. Intel, which we also own, increased from $135 to $160. Analysts reiterated their buy rating on the stock after raising it twice this month. BofA also increased its PTs on buy-rated Micron to $1,500 from $950 and on Applied Materials to $720 from $540. Jim Cramer’s Market column spent a lot of time examining memory chip manufacturers and semi-equipment suppliers. 3. Susquehanna initiated coverage of SpaceX with a hold rating and a $170 price target. Analysts said there was a wide range of results in the company’s relatively unproven markets and recommended waiting for a better entry point. Shares in pre-market trading are 16% above the IPO price. After raising $85 billion in its IPO, SpaceX is also planning a bond sale. 4. Club name Nike has been downgraded from buy level on Evercore ISI ahead of next week’s earnings. Analysts worry the administration will once again cut the numbers, forcing Wall Street to reset its expectations. We said Nike had one more quarter to prove we had to hang on during this frustrating comeback. 5. Wolfe Research is out with a major change in retail ratings. Analysts downgraded Club stock to hold on Home Depot and Five Below, while upgrading Target to buy and calling it their top year-end pick. Home Depot is our hedge against low interest rates and a recovery in housing activity. Wolfe favors rival Lowe. 6. Darden Restaurants was downgraded to hold from buy at Evercore ISI. While analysts say there is nothing “fundamentally wrong” with the parent company of Olive Garden and LongHorn Steakhouse, they expect limited earnings versus consensus. Darden reports earnings on Thursday. 7. A rare downturn in off-price retail: Wells Fargo moved Ross Stores from buy to hold, citing its exposure to lower-end consumers and tough comparisons and inventory building. We have owned Ross’ competitor TJX Companies for years. 8. IBM upgraded from hold to buy on JPMorgan on confidence in software acceleration in the second half. Like many other software companies, IBM’s shares have been hit hard since the beginning of June, falling more than 20% as of yesterday’s close. 9. JPMorgan puts the estimated value of an Amazon Prime membership at $1,440 per year; this is approximately 10 times the actual US annual cost of $139. They arrived at this prediction by breaking down all of Prime’s components. Analysts previously thought Amazon could raise Prime prices in 2026, but now think 2027 is more likely. According to JPMorgan, a $20 increase in U.S. Prime prices could generate $3 billion in revenue growth. Amazon’s Prime Day shopping event started today. 10. Citi maintained its rating while raising the Goldman Sachs Club’s price target to $1,110 from $930. The stock, which closed at a record high of $1,106 yesterday, has been a big winner for us thanks to the deal-making boom. Citi increased Morgan Stanley’s hold rating from $194 to $220 and Bank of America’s buy rating from $62 to $66. Sign up for free for my Top 10 Morning Thoughts on the Market email newsletter (See here for a complete list of stocks in Jim Cramer’s Charitable Trust.) When you subscribe 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 trading alert before buying or selling a stock in his charitable foundation’s portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after issuing the trading alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH THE DISCLAIMERS. NO CIVIL OBLIGATIONS OR DUTIES EXIST OR SHALL BE RESULTING FROM YOUR RECEIVING ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULT OR PROFIT CAN BE GUARANTEED.
