Strong bank earnings, bad loans, spinoff prep, and Dreamforce wrap
The stock market rebounded this week after seesawing on concerns about U.S.-China trade, the ongoing federal government shutdown, and credit. For the week, the S & P 500 and tech-heavy Nasdaq jumped 1.7% and 2.1%, respectively, after each lost more than 2% the prior week. Late in the week, trade and the shutdown took a backseat to worries about regional banks, which spilled into the market. Zion and Western Alliance both disclosed bad loans during a two-day stretch, sparking a selloff in financial names on speculation of cracks in credit quality. Shares of Zion and Western Alliance lost 13% and nearly 11%, respectively, on Thursday after their disclosures. The two stocks clawed back some of those losses Friday as traders bet that those two situations were one-offs and not part of a larger emerging crisis. .SPX .IXIC 5D mountain S & P 500 and Nasdaq weekly performance Wall Street firms tied to U.S. consumer health, such as credit card issuer Capital One , were hit the most. Club name Capital One fell 5.5% on Thursday but then rebounded 4% a session later, turning in weekly gains. Wells Fargo, a giant in consumer banking, fell Thursday and Friday — perhaps, more profit-taking than credit worries after the Club stock surged over 7% on Tuesday following a strong earnings report. Goldman Sachs and BlackRock also issued their quarterly results Tuesday. Wells Fargo Wells Fargo posted a top- and bottom-line beat for the third quarter. Wells Fargo also hiked its return on tangible common equity (ROTCE) target, which is one of the most important profitability metrics for a bank. Wells Fargo is now aiming for a ROTCE of 17% to 18%, which is up from its previous target of 15%. The Club increased its price target on Wells to $92 per share from $90, and reiterated its hold-equivalent 2 rating on the stock as a result. For the week, the stock gained 7.3%. WFC YTD mountain Wells Fargo YTD “What a difference a quarter can make. Back in July, when Wells Fargo reported its second-quarter results, the narrative was that Wall Street’s financial projections were too rosy after a cut to its net interest income (NII) outlook, and that management wasn’t moving fast enough to create opportunities following the removal of its Federal Reserve-imposed asset cap. The stock fell more than 5% to $78.86 that day, and we quickly said buy the pullback due to our longstanding faith in CEO Charlie Scharf,” Jeff Marks, the Investing Club’s director of portfolio analysis, wrote in Tuesday’s earnings analysis. He continued, “Fast-forward to today, and shares are up more than 7% and trading near their all-time high in reaction to a strong quarter. The results weren’t perfect — for the third quarter in a row, Wells Fargo missed the consensus estimate for NII, a crucial revenue source for traditional banks. However, investors let out a sigh of relief when management left the full-year outlook unchanged and provided a fourth-quarter NII guide that was above the Street. That made the market feel encouraged about 2026.” Goldman Sachs Goldman Sachs posted record third-quarter revenue , buoyed by an outperformance in its dealmaking division. Goldman’s investment banking fees surged 42% compared to the same period last year. Still, shares dipped on Tuesday’s report without a clear reason why. The Club, in turn, upgraded Goldman to a buy-equivalent 1 rating. We also hiked our price target to $850 from $750. For the week, Goldman shares fell 1.8%. GS YTD mountain Goldman Sachs YTD “This was a very strong quarter from Goldman Sachs, and any persistent weakness in its stock should be viewed as a buying opportunity. Though expenses were a bit higher than expected, that’s not a concern given the strong Q3 revenue and earnings. More importantly, the high-level metrics investors use to grade financial firms were all ahead of expectations,” wrote Zev Fima, portfolio analyst for the Club. “With initial public offerings and mergers and acquisitions set to further improve into next year, and deregulation as a tailwind, we see plenty of room for Goldman shares to run higher.” BlackRock BlackRock followed suit Tuesday, with its own better-than-expected quarter. Shares jumped that session as Wall Street saw that BlackRock’s pursuit of growth outside of its lower-cost stock and bond funds was paying off. That included an increase in organic base fees, which CFO Martin Small attributed, in part, to its iShares Bitcoin and Ethereum exchange-traded funds. BlackRock was “exactly the dream quarter” that we bought the stock for in the first place, Jim Cramer said during Tuesday’s Morning Meeting. The Club maintained its hold-equivalent 2 rating, while raising its price target to $1,300 from $1,200. The stock rose 2.5% on the week. BLK YTD mountain BlackRock YTD That wasn’t the only positive news BlackRock received this week. On Thursday, CNBC first reported that BlackRock overhauled one of its money market funds to appeal to stablecoin issuers. The retooled fund, called the BlackRock Select Treasury Based Liquidity Fund (BSTBL), is compliant with the GENIUS Act, a landmark piece of legislation that places federal guardrails around stablecoins for the first time. Another benefit of BSTBL: The fund is designed to have more liquidity than its previous iteration, and provides additional access by extending its trading deadline as well. Abbott Labs It wasn’t just financial stocks that released earnings reports this week. Abbott Laboratories posted yet another underwhelming quarter on Wednesday. The diversified health-care company continued to let us down. The Club, in turn, lowered our price target to $140 from $145. We also downgraded the medtech name to a 3 rating from a hold-equivalent 2, meaning we would consider selling into strength. That’s exactly what we did Thursday, exiting our Abbott position entirely. From the sale, the Club realized a gain of roughly 24% on shares purchased last year. For the week, Abbott lost 3%. Honeywell, DuPont Two of our industrial companies, Honeywell and DuPont , disclosed new share distribution details on Thursday ahead of their respective spinoffs. In the case of DuPont, shareholders of record as of Oct. 22 will get one share of Qnity, its soon-to-be separated electronics business, for every two shares of DuPont on Nov. 1. Qnity and DuPont will begin trading as separate stocks on Nov. 3. On Monday , we put out an analysis on what investors should expect once Qnity is spun off next month. Two days later , we put out a follow-up on what the remaining DuPont. On Friday, DuPont was named a short-term catalyst buy idea at Deutsche Bank ahead of the split. The analysts said DuPont trades at a 38% discount to an estimated sum of its parts. DuPont jumped 8% for the week. Honeywell investors as of Oct. 17 will receive one share of its spinoff Solstice Advanced Materials unit for every four shares of Honeywell on Oct. 30. Later that session, Solstice later will start trading independently under the ticker “SOLS.” Honeywell will continue as “HON.” Then, in the second half of 2026, the industrial conglomerate will split its remaining automation and aerospace businesses into separate companies. Here is a breakdown of what investors should expect from the upcoming Solstice split. Honeywell stock turned in a 1% weekly advance. Salesforce Salesforce shares were able to eke out weekly gains during Dreamforce week. Strong gains on Monday before the event started — and then, again, Thursday after a rosy longer-term forecast — carried the week. Late Wednesday, Salesforce outlined an upbeat multiyear financial roadmap. The company forecasted annual revenue of $60 billion for fiscal year 2030, without its pending Informatica deal, higher than the LSEG consensus of $58.4 billion. The news caused Salesforce shares to surge as management rejected Wall Street’s narrative of sluggish revenue growth that’s been weighing on investor sentiment in 2025. “It’s the old Salesforce, and I’ve been waiting for the old Salesforce,” Jim said Thursday. (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 . 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