3 takeaways from Wednesday’s ‘Morning Meeting’ – We’re watching the Fed and firms with pricing power
Every weekday the CNBC Investing Club with Jim Cramer holds a “Morning Meeting” livestream at 10:20 a.m. ET. Here’s a recap of Wednesday’s key moments. We’re letting our stocks run on Fed day Companies with pricing power are winners here Quick mentions: CSCO, NVDA, QCOM, MRVL, CRM 1. We’re letting our stocks run on Fed day The Federal Reserve is expected to announce its third consecutive 75 basis-point rate hike on Thursday, and could give insight into the central bank’s longer-term plan in its fight against inflation. Because it’s difficult to gauge which way the market will go, depending on how big the interest rate is and how hawkish Fed Chair Jerome Powell appears, we plan to let our stocks run today. While the market has had a track record of rallying on FOMC days this year, we don’t know if it will hold. 2. Companies with pricing power are winners here In this high-inflation environment, we believe companies that have the power to set prices, instead of taking them down, will be the winners. These names are able to handle the many headwinds dogging the economy. Here are two Club names that we believe have pricing power: Shares of Apple (AAPL) rose on Wednesday while the many of its peers’ stocks sank. The company’s decision to raise prices in the App Store overseas to offset currency headwinds likely is helping to buoy the stock. Jim says Abbvie (ABBV) has pricing power, citing JPMorgan’s note on Tuesday stating it sees an “attractive setup for shares” into 2023. 3. Quick mentions: CSCO, NVDA, QCOM, MRVL, CRM Here are quick takes on some Club names: Jim Cramer said that while Barclays downgraded Cisco (CSCO) to equal weight on Wednesday, he believes that everything appears to be “business as usual” for the company. Nvidia (NVDA) CEO Jensen Huang said in his Wednesday appearance on ” Mad Money ” that it needs to shed inventory of computer graphics cards, but said that he believes Nvidia’s new chips will reignite the gaming industry. Investors who believe him could do some buying here. But we haven’t bought any shares back just yet. “The question is, will the stock bottom before the gaming cycle bottoms?” said Jeff Marks, director of portfolio analysis for the Club. There are also two Club names with exciting events coming up: The chief executives of Marvell (MRVL) and Salesforce (CRM) are making appearances on “Mad Money” Wednesday night. Check back on the Investing Club homepage for exclusive insight into those chats. Qualcomm (QCOM) will hold its Automotive Investor Day on Thursday. We’ve heard that the company could reveal some of its relationships that are unknown to those outside the company — and we expect that the announcements could lead investors to realize the stock is too cheap. (Jim Cramer’s Charitable Trust is long AAPL, ABBV, CSCO, NVDA, QCOM, MRVL, CRM. 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.
