Since the last CNBC Investment Club monthly meeting, stocks have fallen as renewed inflation concerns stemming from rising oil prices have pushed up Treasury yields, creating a detrimental situation for the market. It was much the same in early trading Thursday, with U.S. crude oil prices above $100 a barrel due to uncertainty over an Iran war, joining international crude oil already above that troubling threshold. In response, the yield on the 10-year U.S. Treasury rose above 4.9%, its highest level since November 2023. The worst was a roughly 1% drop in the Nasdaq in the early hours of trading, followed by smaller declines in the S&P 500 and Dow Jones Industrial Average. Nasdaq has since pared some of its losses. The decline from the last monthly meeting on Aug. 13 to Wednesday’s close was led by the Dow, which fell 2.7%, the S&P 500 by 2.1% and the tech-heavy Nasdaq, which fell 2.1%. Ahead of the September meeting livestream starting at noon ET, take a look at what our top three and bottom three stocks have moved over the past four weeks. Top performer Salesforce up 21.3% Salesforce delivered better-than-expected revenue and a positive outlook, providing new evidence that AI is helping businesses, not destroying them. CEO Marc Benioff dismissed the SaaSpocalypse concerns as “nonsense,” pointing out that nine out of the 10 largest AI companies use Salesforce products, and their spending is up 435% year over year. The software company also announced Claudeforce, which integrates Anthropic’s Claude and Salesforce customer data to help users automate tasks. After spending much of the year in the penalty box over concerns about AI disruption, Salesforce is finally showing investors that it’s a beneficiary of the technology. The company’s Dreamforce showcase event is scheduled for next week, which could provide further stimulus for the stock, which still has work to do to get back to its year-to-date level. Meta Platforms Up 9.9% The parent company of Facebook and Instagram went from being one of the worst-performing companies at its previous monthly meeting to one of the best-performing companies ahead of Thursday’s meeting. How did this happen? Two large overhangs have been alleviated. Meta Inc. has agreed to an $18 billion settlement with attorneys general across the country over claims that the social media platform harms young users, eliminating the risk of a lengthy trial and possible significant fines. Jim said the resolution is a “really big change” for the company. Investors also became more optimistic about Meta’s AI efforts after the release of Muse Spark 1.3, praising its features and low cost, strengthening the case that Meta can compete with leading AI labs. After months of skepticism about the company’s large AI investment, these developments give investors further reason to reconsider the stock. Micron is up 8.2% (remember, this increase is as of Wednesday’s close; the stock has been volatile and was down early Thursday). Micron’s stock has been trending better since its recent sell-off as the outlook for AI memory demand continues to rise. Bullish long-term forecasts from fellow club names Nvidia and Broadcom confirm that demand for AI chips remains supply-constrained, and readthrough for high-bandwidth memory and DRAM, or dynamic random access memory, is also positive. Both Microns are large. The stock was caught in a forced selloff earlier this summer over easing situational awareness, but the latest industry data points are helping investors refocus on fundamentals. We continue to believe that tight memory supplies and surging AI demand give Micron significant pricing power and a long runway for growth. That’s why I bought more shares last week. Bottom TJX company falls 18% The off-price retailer stumbled due to a rare execution error at its largest division, Marmaxx. While overall sales, profits and same-store sales exceeded expectations, comparable sales for the division that includes TJ Maxx and Marshalls rose just 1%, well below expectations. Management took responsibility for the incorrect mix of inventory. They said they have a plan in place to fix it and are already seeing improvements. Several Wall Street companies lowered their stock prices over concerns that the problems could be prolonged and that TJX was losing its competitive advantage. We took advantage of the sell-off to increase our position, but Jim said last week that he is closely monitoring this failure to be temporary. FedEx Freight falls 17.9% FedEx Freight continued to struggle after its spinoff in June, as concerns over tariffs and soaring oil prices weighed on transportation stocks. We do not believe this weakness reflects a deterioration in the company’s long-term story and believe that FedEx Freight is well-positioned to benefit when the freight cycle recovers. Jim said he would like to buy more stock in the sub-truckload leader, but wants to see oil prices settle first. Palo Alto Networks – 15.4% This cybersecurity company was sold despite reporting strong quarterly results that support our view that AI is a major tailwind for cybersecurity. CEO Nikesh Arora said that about $1 trillion in global cybersecurity infrastructure needs to be modernized to deal with emerging AI threats, highlighting the long-term opportunity. However, as the stock price was strong, investors took advantage of the financial results report to lock in profits. I’m glad I was able to lower the ranking before printing. We use the decline in earnings to indicate a holding pattern and upgrade Palo Alto’s rating from a 3 to a 2 for sell strength. (Jim Cramer Charitable Trust has long-term holdings in AVGO, CRM, FDXF, META, MU, NVDA, PANW, TJX. See here for a complete list of stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive advance trade alerts. Jim makes a deal. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in the charitable trust’s portfolio. If Jim talks about a stock on CNBC TV, he will issue a trade alert and then wait 72 hours before executing the trade. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
