Every weekday, the CNBC Investing Club with Jim Cramer holds a “Morning Meeting” livestream at 10:20 a.m. ET. In a recent meeting, several critical market developments were discussed.
On Thursday, stocks witnessed a modest increase following reports of a renewed agreement between the U.S. and Iran to extend their ceasefire for an additional 60 days. This also set the stage for negotiations concerning Iran’s nuclear program, which emerged as a significant macroeconomic narrative of the day. Earlier that morning, the personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, revealed a seasonally adjusted increase of 0.4% in April. This figure fell slightly below economists’ expectations of a 0.5% rise. Year-over-year, headline inflation maintained a rate of 3.8%, aligning with projections. This data contributed to alleviating some concerns about lingering inflation, resulting in a slight relief for the markets.
Shares of Snowflake, a data analytics firm, saw a remarkable surge of 35% following a robust quarterly earnings report released the night before. Cramer highlighted this shift, noting that CEO Sridhar Ramaswamy has effectively transformed Snowflake from a conventional software company into one focused on artificial intelligence. Of particular interest was Snowflake’s announcement of a $6 billion commitment to Amazon Web Services, which included expanding its use of Amazon’s custom Graviton chips and AI computing infrastructure. Cramer pointed out that this partnership enhances confidence in Amazon’s growing custom chip sector, adding that investors should seize the opportunity presented by a minor pullback in Amazon shares.
Meanwhile, Club holding Starbucks showed signs of progress in a pivotal aspect of its recovery strategy: afternoon traffic. New reports indicated an uptick in visits to U.S. coffee shops during the afternoon, particularly between 3 p.m. and 5 p.m. This increase was identified by management as crucial to optimizing staffing levels and boosting profitability. Cramer encouraged those not yet invested in Starbucks to consider purchasing shares, predicting a target price of $120, which suggests a potential upside of approximately 17% from current levels.
Towards the end of the meeting, Cramer briefly covered stocks such as CVS, Eli Lilly, and Marvell, summarizing the market’s pulse as he remains committed to the long-term prospects of Amazon and Starbucks. The CNBC Investing Club offers subscribers trade alerts before transactions occur in Cramer’s charitable trust’s portfolio, with specific waiting periods depending on the circumstances surrounding each stock.
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