Major Fed rate dissent, Powell to stay on — plus, Boeing takes an unwarranted hit
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks pulled back for the second day in a row — a little wobbly as oil prices continued to rise. West Texas Intermediate crude topped $107 per barrel, while international Brent crude prices exceeded $119. U.S. gasoline prices were also increasing, with the AAA national average up to nearly $4.23 per gallon from roughly $4.18 on Tuesday and $4.02 one week ago. Bonds were on the move with the 10-year Treasury yield back above 4.4%, despite the Federal Open Market Committee on Wednesday afternoon leaving interest rates unchanged at the conclusion of its two-day April meeting. The 8-to-4 vote from the FOMC, the Federal Reserve’s policymaking group, was significant because it’s the first time since 1992 that four central bankers dissented. Fed governor Stephen Miran voted again for a cut. Regional Fed presidents Beth Hammack, Neel Kashkari, and Lorie Logan voted to hold rates steady but “did not support the inclusion of an easing bias” in the policy statement. During what’s expected to be his final post-meeting news conference as Fed chairman, Jerome Powell said that when his chairmanship ends next month, he plans to stay on as a central bank governor for a yet-to-be-determined period of time. He said he wants to stay on to make sure the Justice Department won’t reopen its criminal investigation into the central bank’s renovation. Powell also congratulated Kevin Warsh on nearing confirmation to replace him. Boeing shares took a hit after its main rival scored a multibillion-dollar deal from one of China’s major state-owned carriers. It was announced on Wednesday that China Southern Airlines ordered 102 Airbus A320neo jets and one of its subsidiaries ordered 35. The orders were valued at $21.37 billion before any discounts, according to the South China Morning Post. The news is being taken as a blow to Boeing , which hasn’t received any new orders from China since 2017. We, however, don’t see it that way. Boeing is expected to receive a “big number” order — in CEO Kelly Ortberg’s words — from China in the future. That date is heavily dependent on the upcoming summit between President Donald Trump and Chinese President Xi Jinping. Previous reports indicated that a Boeing deal could be for up to 500 planes. The Post called Boeing’s rumored deal with China “elusive,” and that could explain why the Club stock fell more than 3% on Wednesday. We are not swayed and remain upbeat about the odds of a China order for Boeing if the Trump-Xi meeting goes well. We think the decline in Boeing stock on the Airbus news is an overreaction. It’s the most important earnings night of the quarter , with Club names Amazon , Alphabet , Meta Platforms , and Microsoft all scheduled to report. In addition to revenue and earnings, we’ll be focused on what the companies have to say about AI demand trends, supply constraints, and capital expenditures. Last quarter, the four guided to at least $608 billion in capex this year to keep in the AI arms race . Also on the evening earnings docket are results from Chipotle, Ford, Carvana, and Qualcomm. Before Thursday’s opening bell , we’ll get earnings from Club names Eli Lilly and Cardinal Health , as well as Bristol Myers, Merck, Caterpillar, Mastercard, and Molson Coors. On the data side, we’ll see the March reading of Fed’s preferred inflation gauge — the personal consumption expenditures (PCE) price index. Weekly jobless claims and the first read on first-quarter gross domestic product are out. (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 . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
<
