Every weekday, CNBC Investing Club with Jim Cramer publishes Homestretch – an actionable afternoon update just in time for the ultimate hour of trading on Wall Street. (We are not any longer recording the audio so we are able to get this latest written feature to members as quickly as possible.) Market Talk: The S&P 500 and Nasdaq jumped to latest intraday highs on Wednesday, extending gains the previous meeting from rally late within the day. In fact, the S&P 500 broke 5,300 for the primary time ever. The Dow, meanwhile, was about half a percentage point away from its all-time high. Wednesday's meeting was triggered by a weaker-than-expected consumer price index for April, which led to an increase in government bond prices and a fall in yields (corresponding to their inverse relationship). As a result, market odds for multiple Federal Reserve rate cuts this yr increased. A weak retail sales report for April, also out on Wednesday, was seen as “bad news is good news” as slowing demand for goods could help moderate inflation. The only thing we remain vigilant about on this rally is how overbought the stock market has change into. You need to look back to last December to search out a time when the S&P 500 Short Range Oscillator was so overbought. To be fair, only a slight decline was needed to beat the overbought condition on the time – the S&P 500 fell about 2% from December 28, 2023 to January 4. However, the market took a number of weeks to digest the late 2023 run-up before heading back up. New High: We had a probability to read Danaher's bullish presentation on the Bank of America Healthcare conference on Tuesday. We thought management's discussions were consistent with what we heard last month, when the life sciences and medical diagnostics company delivered strong results across its three core businesses. We saw it as an indication that the long-awaited turnaround within the biotech industry was finally here. At the conference, Danaher further noted that inventory depletion within the bioprocessing industry might be accomplished by the second quarter, driven by the normalization of inventory levels and ordering patterns from major customers. The company cautiously forecast continued low activity in China. One point from the conference that we found particularly interesting was that if drug prices decline in consequence of the Inflation Reduction Act, Danaher could see a tailwind because it is predicted that the volumes and consumption of those drugs to patients would increase. Danaher's business consists primarily of consumables and is subsequently volume-oriented. Danaher shares rose greater than 1% on Wednesday, adding to three% gains from the day past. The move takes the stock to a brand new 52-week high, although still about $30 per share below its Covid pandemic record. The stock's strong performance over the past yr is a very good example of how holding on to an investment in a high-quality company will pay off while the corporate weathers temporary inventory issues. In these cases, the stock price is prone to bottom long before its economic cycle. Cramer quickly gets to the purpose: “It could be a big deal for unemployment claims that Red Lobster suddenly closed about 50 restaurants. That’s a lot of employees,” Jim Cramer said. “Disney doesn't deserve this drop as it's becoming a very cheap stock, but people don't think Disney is serious about the layoffs now. No Peltz.” “Data centers are natural gas guzzlers. I believe loads of natural gas power plants are being built to satisfy the electricity demand.” Next up: Cisco Systems reports after the closing bell on Wednesday, and we're excited to hear what the networking equipment maker has to say about its Splunk acquisition. On Thursday morning we will hear from Walmart, Deere and some Chinese companies in Baidu and JD.com. (A complete list of Jim Cramer's Charitable Trust stocks can be found here.) As a subscriber to 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 foundation's portfolio. If Jim discussed a stock on CNBC television, he waits 72 hours after the trade alert is issued before executing the trade. THE INVESTING CLUB INFORMATION SET FORTH ABOVE IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, ALONG WITH OUR DISCLAIMER. THERE ARE NO fiduciary duty or duty IN RECEIVING YOUR INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
image credit : www.cnbc.com