Wall Street rediscovered its winning ways last week, thanks to some promising inflation data. Investors are now focusing on Donald Trump’s first week back in the White House and another bundle of earnings. It was no surprise to see relatively muted action last Monday and Tuesday, given markets were reeling from a hot December jobs report on Jan 10 that sent interest rates soaring and equities sinking. A weaker-than-expected producer price index last Tuesday had investors feeling a little more at ease following the jobs “scare.” Still, it was last Wednesday when the animal spirits really hit the market. That’s when we got an encouraging December consumer price index and a batch of big bank earnings that kicked off the fourth-quarter reporting season with a bang and foretold of a positive year ahead. The CPI, in particular, took the hammer to Treasury yields and quelled fears that the Federal Reserve may not cut rates all that much this year. It added up to a week in which the S & P 500 climbed 2.9%, the tech-heavy Nasdaq gained 2.45%, and the Dow Jones Industrial Average leaped 3.7%. It was the first positive week of the year for the major indexes after beginning 2025 with back-to-back losses. The S & P 500 and Dow, meanwhile, had their best weekly advances since the week of the presidential election in November. A trio of Club names helped paint that optimistic picture last Wednesday, with financial holdings Goldman Sachs , Wells Fargo and BlackRock all reporting strong earnings. Goldman Sachs feels as good as we do about mergers-and-acquisitions activity, as well as initial public offerings, in 2025. “While there remained some policy uncertainty, there is an expectation that the regulatory burden will be reduced, which should serve as a tailwind to risk assets and capital deployment,” CFO Denis Coleman said on the earnings call. “We are optimistic on the outlook for 2025 and expect to further pickup in M & A and IPO activity.” Goldman’s report helped propel the name to be the portfolio’s biggest winner for the week, jumping 11.8%. Wells Fargo was rewarded for its robust quarterly profits and rosy outlook , closing out the week as the portfolio’s second-best holding, up 10.2%. The firm demonstrated that it is on track to deliver a sustainable return on tangible common equity of 15% longer-term after achieving a 13.4% ROTCE for all of 2024. The bank also provided a better-than-expected outlook for net interest income and total expenses for the current year. BlackRock proved the doubters wrong as what’s expected to be a pivotal year of expansion into fast-growing markets, such as private credit, gets underway. In addition to the firm receiving more net inflows than the Street was expecting, the company’s profitability was ahead of expectations thanks to further fee growth. Jim Cramer spent a good chunk of last week in San Francisco speaking with CEOs and industry experts at the JPMorgan Healthcare Conference. That included a conversation with David Ricks, CEO of Eli Lilly , our worst-performer last week after the GLP-1 drug giant cut its fourth-quarter guidance . Shares fell further Friday on news that chief rival Novo Nordisk’s GLP-1 drug will be subject to price negotiations with Medicare, effective in 2027. However, we remain upbeat and view the weakness as a buying opportunity. In his Sunday column, Jim wrote about the 10 things he learned at the JPMorgan conference. Another struggling Club stock was Apple , which sold off hard Thursday on a disappointing report about iPhone sales in China. That came on the heels of a bearish shipments forecast from the closely watched Apple analyst Ming-Chi Kuo in the prior week. Apple is our second worst-performing stock this year, behind only troubled Constellation Brands . We’re expecting the stock’s fortunes to improve , but just not yet. On Monday, Trump was sworn in as president when the market was closed in observance of Martin Luther King Jr. Day. Still, investors will pay close attention to Trump’s initial tranche of executive orders , along with other market-moving comments and decisions he makes in the coming days. Trump’s actions on tariffs and energy policy will be especially notable. Trump also said he would halt the enforcement of the TikTok ban for at least 75 days. The murky TikTok situation has implications for Club name Meta Platforms . From Washington to Wall Street, we’ll get a bit of a lull before the fourth-quarter earnings season intensifies for the Club. The only portfolio company set to report is Abbott Laboratories on Wednesday morning. After the company picked up an important legal win in November regarding its specialized formula for premature babies, we’re looking for fundamentals to be front and center. That includes Abbott Labs’ new consumer-focused continuous glucose monitoring system Lingo. “Lingo is doing great,” CEO Robert Ford told Jim at the JPMorgan Healthcare Conference, and we figure to receive additional insights on Lingo’s sales on Wednesday’s earnings call. Going forward, we think Abbott shares are likely to prove too cheap based on 2025 earnings estimates as investors come to appreciate the strength and diversity of Abbott’s offerings. According to LSEG, the Street is looking for fourth-quarter sales of $11.01 billion and earnings of $1.34 per share. There is a real lack of economic news in the coming days. For that reason, earnings reports and management commentary on conference calls should be a significant driver of the market action. We’re big believers in paying attention to earnings across the corporate world, not just within the portfolio, because management teams offer real-time and forward-looking commentary. Compare that with economic data releases, which are generally backward-looking in nature, often by a month or more. In other words, CEOs and CFOs can provide more useful information to investors than what can be gleaned in, say, a monthly manufacturing report. Case in point: On Friday, we’ll get existing home sales for December from the National Association of Realtors, but we’re much more interested in what we hear from the homebuilder D.R. Horton when it reports Tuesday. 3M and GE Aerospace report earnings on Tuesday and Thursday mornings, respectively, which combined will provide what we call a “readthrough” into Club name Honeywell . Like Honeywell, 3M is a diversified industrial with exposure to a variety of end markets such as energy, health care and aerospace, so its results and executives insights into the broader economic environment will be of interest. It’s a similar dynamic a few days later with GE Aerospace , except for the numbers and discussion will primarily be relevant to Honeywell’s aerospace business. We have to wait until Feb. 6 to hear from Honeywell, at which time it’s expected the company will announce a breakup of its aerospace unit. Procter & Gamble reports results on Wednesday morning, providing readthroughs into a couple pertinent areas for the portfolio, including the overall consumer spending picture including in China. Commentary on input costs and future plans on price hikes are relevant to the inflation story. With its global presence, P & G also will show how multinational companies based in the U.S. are being impacted by a strong dollar. The U.S. dollar index, which measures the greenback against a basket of other currencies, has been trending higher since September and is trading near its highest level since 2022. Week ahead Tuesday, Jan. 21 Before the bell: Charles Schwab (SCHW), D.R. Horton (DHI), KeyCorp (KEY), 3M (MMM) , Fifth Third Bancorp (FITB), Prologis (PLD) After the bell: Netflix (NFLX), United Airlines (UAL), Interactive Brokers (IBKR), Capital One Financial (COF) Wednesday, Jan. 22 Before the bell: Abbott Labs (ABT) , Procter & Gamble (PG) , Halliburton (HAL), Johnson & Johnson (JNJ), GE Vernova (GEV), Travelers (TRV) After the bell: Kinder Morgan (KMI), Alcoa (AA), Discover Financial Services (DFS), SL Green Realty (SLG) Thursday, Jan. 23 8:30 a.m. ET: Initial jobless claims Before the bell: GE Aerospace (GE) , American Airlines (AAL), Freeport-McMoRan (FCX), Elevance Health (ELV), Alaska Air (ALK), Union Pacific (UNP), McCormick & Company (MKC), After the bell: Texas Instruments (TXN), Intuitive Surgical (ISRG), CSX (CSX) Friday, Jan. 24 10 a.m. ET: Existing home sales Before the bell: Verizon Communications (VZ), American Express (AXP), Ericsson (ERIC), HCA Healthcare (HCA), NextEra Energy (NEE) (Jim Cramer’s Charitable Trust is long GS, WFC, BLK, AAPL, LLY, HON, META and ABT. See here for a full list of the stocks.) 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.
A cutout of President elect Donald Trump as traders and financial professionals work on the floor of the New York Stock Exchange (NYSE) during the first session of the new year on January 2, 2025, in New York City.
Timothy A. Clary | Afp | Getty Images
Wall Street rediscovered its winning ways last week, thanks to some promising inflation data. Investors are now focusing on Donald Trump’s first week back in the White House and another bundle of earnings.
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