3 forces that drove the stock market during Wall Street’s comeback week
The stock market staged a comeback last week as Wall Street rode amid a flurry of headlines both optimistic and troubling. Nasdaq broke its five-week losing streak on Friday, boosted by strong advances from our big tech names like Meta Platforms, Nvidia and Amazon. The technology-heavy index completed the week with a 1.9% increase. The S&P 500 rose 1.1% in the holiday-shortened week, snapping out of a two-week decline. The Supreme Court’s ruling Friday challenging President Donald Trump’s emergency tariffs helped lift stocks of many consumer-facing companies that have been burdened by higher costs from imports. The index could have gained further value throughout the week if not for private credit concerns from Blue Owl Capital, which caused volatility in some financial names. At least all of our bank stocks remained above the fray and finished the week higher, led by Wells Fargo’s 2% gain. Goldman Sachs wasn’t far behind, up 1.9%. Capital One gained 0.5%. We will see whether this recovery can continue until Monday. Until then, here are three factors that have driven the stock market and our portfolio over the last four trading sessions. .SPX YTD mountain S&P 500 (SPX) year-to-date performance Supreme Court tariff decision The S&P 500 rose 0.7% on Friday after the Supreme Court struck down most of Trump’s sweeping tariff agenda in a 6-3 decision. The high court argued that no president has ever used the law “to impose tariffs of any kind, let alone tariffs of this size and scope.” Trump must “point to clear congressional authorization” to justify his “extraordinary” tariff powers, the majority wrote. “He can’t.” Trump backtracked on Friday afternoon, threatening 10% global tariffs. But these new taxes can only last 150 days without further congressional action to extend them. Trump also posted about the additional tariffs on Truth Social on Saturday. Perhaps a clearer picture will emerge when the President delivers his State of the Union address to Congress on Tuesday. But the court’s decision wasn’t entirely clear on whether investors should bid on stocks hurt by tariffs. Just look at Nike, which previously guided for a $1.5 billion tariff this fiscal year. While the stock initially rose on the court’s decision, it closed up 0.3% as the market realized Trump would find alternative ways to impose higher taxes. Our other consumer companies, including Costco, Procter & Gamble, TJX Companies, and Amazon, were also affected by the decision. Leading up to the court ruling, the club explained how these tariffs directly impact pricing, margin and stocking strategies for each company. Big Tech is coming back roaring Megacap tech stocks are finally making a comeback. Meta announced Tuesday that it will use millions of Nvidia chips in its data centers. Both names have jumped as a result, reinforcing the narrative of relentless AI demand and a new wave of hyperscaler spending. Meta and Nvidia finished the week with increases of 2.5% and 3.8%, respectively. Amazon shares also rose after a regulatory filing Wednesday showed Bill Ackman’s Pershing Square significantly expanded the fund’s position in the fourth quarter. The e-commerce giant rose 5.6% for the week, making it the top portfolio performer. Alphabet was left behind in the group at the beginning of the week as the stock continued its downward trend after earnings. The club bought more shares of the AI leader, arguing that the withdrawal was unwarranted. One session later, shares recovered and finished the week up 3%. In the same session, we corrected our Corning position after a huge run in 2026. While not a big tech name like others, the company has benefited from the AI business as its fiber optic cables play an increasingly important role in data centers. Corning was the second-best stock of the week, up 4.5%. Credit crisis? Private credit concerns at Blue Owl Capital sent ripples across the financial industry last week. Shares fell nearly 6% on Thursday after the asset manager permanently restricted withdrawals from its private debt fund for retail investors. Some on Wall Street are calling Blue Owl the “canary in the coal mine” and suggesting that the fast-growing private loan market, which has attracted billions in capital in recent years, may be in apparent trouble. Shares of the largest private asset managers, including Ares Management, Apollo Global, Blackstone and KKR, were hit hard on Thursday. Ares and Blackstone fell big again on Friday, finishing the week as the two worst names in the S&P 500 financial sector, down 8% and 6.6%, respectively. Apollo rose 1.2% on Friday, recovering some of its 5.6% decline in Thursday’s session. We do have some BlackRock proprietary credit exposure in our portfolio, but that is not of concern to us at this time. The market seemed to agree: Shares fell just 1% on Thursday, rebounded on Friday and finished the week up 2%. And more generally, Jim does not deny the existence of some bad loans in the private credit complex. But he wrote Friday morning that he did not believe the situation was “inherently tragic” at this stage. Capital One is the only Club financial institution we traded with last week and purchased additional shares of the credit card issuer on Wednesday. The trade on Wednesday also included the sale of Danaher and Texas Roadhouse. We exited the restaurant stock entirely on Friday after the previous evening’s earnings report convinced us that the beef inflation problem isn’t going away anytime soon. (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 would wait 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.
