Here are 3 reasons we are not going to buy stocks in Friday’s nosediving market
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. Market moves : The S & P 500 was dropping almost 2% on Friday as weak jobs and new tariff levels unsettled the market. Investors also were digesting President Donald Trump’s decision to order the firing of the labor statistics commissioner , alleging political manipulation of jobs data. After closing at a record high on Monday, the index was set to finish the week on a four-session losing streak. While some of these lower stock prices were tempting, we are not going to make any buys on Friday for three reasons. First, the monthly jobs report plays a significant role in our outlook and worldview, and the weakness over the past three months — especially after the downward revisions — is a concerning signal. Second, the impact of the tariffs is still unclear. Third, there are obvious signs of greed following Figma ‘s 250% increase on its first day of trading on Thursday. We would like to see some of that froth leave the market. So, heading into the weekend, we’re watching the market closely with our big cash position, waiting to pounce if even more attractive prices emerge next week. Earnings season : As our CNBC colleague Robert Hum points out, 81% of S & P 500 companies that have reported quarterly results so far beat earnings estimates. This is the highest beat rate since the third quarter of 2023. For context, Hum said we usually see a beat rate somewhere in the mid to high 70% range. On the revenue side, 79% of companies reported beats, representing the highest levels since the second quarter of 2021. Next week : It’s another important week of corporate earnings, with about a fourth of the S & P 500 set to report. Six companies in the Club portfolio are on the schedule: Coterra Energy , DuPont , Eaton , Disney , Eli Lilly , and Texas Roadhouse . On the data side, expect the major economic reports to face a greater level of scrutiny following Friday’s soft jobs report and ugly downward revisions. Some releases to be on the lookout for next week are factory orders, capital goods orders, the ISM services index, and weekly jobless claims. (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.
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