Eaton finalizes a smart acquisition to advance its AI data center ambitions
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. The S & P 500’s oversold bounce could not hold on Friday, and the early gains were erased. The reason was oil, which was lower for most of the morning but reversed by the afternoon. U.S. benchmark WTI crude traded as high as $98 a barrel Friday, before retreating a bit. Global oil standard Brent crude traded north of $100 a barrel. Some equity investors may also be hesitant to “stay long” ahead of what’s expected to be another busy weekend of military action in the Middle East. While the market action during the Iran war may feel draining, our plan remains to be more opportunistic as the S & P Oscillator drops toward minus 10%, a level the Oscillator reached in September 2022 and April 2025. Both of those instances proved to be good times to put money to work. As of Friday afternoon, the Dow Jones Industrial Average was down nearly 2% for the week. The S & P 500 was down about 1.5%, while the tech-heavy Nasdaq was off a little over 1%. Eaton announced late Thursday it closed its $9.5 billion of Boyd Thermal. The deal brings Boyd Thermal’s liquid cooling solutions to a company that is best known for its electrical equipment and power management solutions, increasing its exposure to AI data centers. One of the key points Eaton CEO Paulo Ruiz emphasized on Eaton’s third-quarter earnings call — just days after the Boyd announcement — was that the liquid cooling market is seeing unprecedented growth, driven by each new generation of AI chips from Nvidia requiring more power per rack. We’ll hear more about chip power requirements next week at Nvidia’s GTC conference. Eaton’s data center exposure will further increase early next year after it spins off its Mobility unit , an “addition by subtraction” move because that’s a slower growing, lower-margin business. There are no Club companies scheduled to report next week , but there are two highly anticipated earning releases outside the portfolio. The first is Micron after the closing bell on Wednesday. What the company has to say about tightness in the memory market could impact other semiconductor stocks and technology names like Apple and Cisco Systems , who source a lot of short-term DRAM memory from the likes of Micron, SK Hynix and Samsung. The other is FedEx , which is a bellwether for commerce. It’s a great time to hear what CEO Raj Subramaniam says about global trade. FedEx also is in the midst of a breakup plan to separate its freight business into a standalone company. Conference season is also in full swing next week , and expect to hear first-quarter updates from the Bank of America Global Industrials Conference, JPMorgan Industrials Conference, Optical Fiber Communications Conference, and more. But the biggest of them all will be Nvidia’s annual GTC conference, where CEO Jensen Huang will showcase new products and update his view on the AI infrastructure buildout. Earlier Friday, we explored Nvidia’s potential plans for a new type of AI chip focused on daily usage of AI models. Finally, next week is Jerome Powell’s penultimate Federal Open Markets Committee meeting as the Federal Reserve’s chair. The central bank’s policymaking committee is largely expected to leave rates unchanged at the meeting, and bets of rate cuts later this year are dwindling due to rising oil prices. President Donald Trump has nominated former Fed governor Kevin Warsh to replace Powell. This meeting will give us an update to date view on how the Fed is balancing softness in the labor market with inflation risks. (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.
<
