It was a terrific third quarter for Wall Street as the stock market hit record high after record high. The S & P 500 and Nasdaq climbed 7.8% and 11.2%, respectively, from the June 30 close to Tuesday’s close, the session before the start of the fourth quarter, which began on a sour note after the government shut down early Wednesday morning. The final quarter of the year is historically the strongest for stocks. We will have to see if that holds true in an already stellar 2025, which has seen the S & P 500 and Nasdaq gain more than 13% and 17%, respectively, year to date. .SPX .IXIC YTD mountain 2025-06-30 S & P 500 vs. Nasdaq YTD The Q3 outperformance came despite a cocktail of uncertainty. Investors continued to speculate over the Federal Reserve’s monetary policy decisions. The Fed, however, did finally announce a quarter-percentage point reduction to the overnight lending rate on Sept. 17, the first cut since Dec. 2024. Wall Street also mulled President Donald Trump ‘s tariff moves and the longevity of the generative artificial intelligence trade. Since the end of the second quarter, the Club has sent out dozens of trade alerts. This includes initiations of Nike , Cisco Systems , and Boeing, while exiting Coterra Energy altogether. Through it all, there were clear winners and laggards in the third quarter — a diverse group spanning Big Tech to industrials. Here’s a breakdown of the portfolio’s top three and bottom three performers over the period, along with the Club’s updated take on each. Gainers 1. Apple: +24.1% Apple shares were buoyed by an early August announcement that the company would boost its investment in U.S. manufacturing by another $100 billion, bringing its total commitment to $600 billion over the next four years. Investors celebrated how CEO Tim Cook navigated the Trump administration’s threats of higher tariffs against the iPhone maker. Less than a month later, Apple stock surged again after a favorable ruling in Google’s antitrust case. A federal judge ruled that Alphabet -owned Google could still make billions of dollars in payments to Apple to preload Google Search onto the iPhone and other company devices. Wall Street liked the news because it prevented an immediate hit to Apple’s high-margin services business. The ruling also opened the door for similar deals with large language model providers to bring AI services to Apple, which could improve the company’s so-far lackluster generative AI rollout. Finally, Apple owes its most recent gains to positive signs for the company’s new iPhone 17 and Air lineup. Wall Street analysts have said so themselves. JPMorgan, for example, raised its price target on Apple to $280 apiece from $255 last week, citing favorable demand indications since the new devices were introduced on Sept. 9. Jim has sent a clear message to Wall Street : Get more bullish on Apple stock. 2. Broadcom: +19.7% The custom chipmaker received a leg up after posting a top and bottom line beat last month, propelled higher by management’s commentary around a new customer’s $10 billion worth of AI-related orders. As a result, Broadcom CEO Hock Tan said that AI revenue for the full year should “improve significantly” compared to previous expectations. The Club hiked its price target to $350 from $290 following the release. Additionally, shares benefited from the continued strength in the generative AI trade, too. In turn, the Club trimmed our Broadcom position a few times over the past quarter. Our conviction in the stock hasn’t changed. Instead, it’s important to remain disciplined and right-size a position when necessary. 3. Nvidia: +18.1% Rounding out our top three quarterly gainers was Nvidia . Like Broadcom, the chipmaker’s shares surged on signs that AI spending wasn’t easing up anytime soon. Investors saw this in quarterly earnings reports from Club holdings Meta Platforms, Amazon, and other Big Tech names, which raised their capital expenditures. Oracle ‘s quarterly earnings report gave AI-linked stocks another lift in September on the back of blistering demand for the company’s cloud services. Trump also gave Wall Street some assurance that the administration would give Nvidia licenses to offer its H20 AI chip in China – a crucial market for the company. Nvidia also announced a $100 billion investment to help OpenAI build data centers. Shares hit a record high as recently as Tuesday. Laggards 1. Salesforce: -13.1% It’s not a surprise to us that Salesforce was the portfolio’s worst Q3 performer. In general, Software as a Service (SaaS) names have taken hits as the rise of generative AI puts revenue for their seat-based models at risk. That’s exactly why, in August, the Club downgraded Salesforce stock to a hold-equivalent 2 rating from a buy. Plus, quarterly earnings in early September didn’t help investor sentiment either. The company disappointed investors with its financial outlook. In Jim Cramer’s interview with CEO Marc Benioff, he asked about the company’s guidance versus expectations. Benioff defended the outlook, saying in part: “Maybe I’m just being too conservative. I think I’m being appropriately conservative, but I’ve always been that way for 26 years.” The next catalyst for Salesforce comes later this month when it holds its annual Dreamforce conference, which needs to wow investors . 2. Texas Roadhouse: -11.3% This stock has been hit over the past three months due to commodity inflation. Higher beef prices, which have eased somewhat recently, weighed on shares as investors worry about whether Texas Roadhouse will pass on the additional costs to diners or absorb them. Quarterly earnings in early August affirmed that concern, even with strong comps as beef prices still dented results. But the casual steakhouse chain is otherwise executing well on everything it can control. We’re conflicted, but still sticking with Texas Roadhouse. 3. Honeywell: -9.6% Honeywell shares have dragged ahead of the industrial conglomerate’s forthcoming split into three publicly traded entities. The stock’s underperformance is likely due to a Wall Street phenomenon, known to some investors as “spin purgatory.” Other Club stocks like DuPont have undergone similar patterns. That doesn’t mean there’s anything wrong with Honeywell’s fundamentals, though. After all, we still believe the split will unlock much more value for the company. (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.
Top 3 Club stocks, and bottom 3, as the market surged in Q3
