Intel draws Cramer buying interest as chip shares weigh on Nasdaq
CNBC Investing Club said Intel was on its watch list after a weekly slide, while banks and Johnson & Johnson earnings are due next week.
By Marcus V. Thorne · Markets Editor
· 3 min read
The Nasdaq traded slightly lower on Friday as semiconductor shares including Micron, Intel and Broadcom pressured the technology-heavy index, according to CNBC Investing Club with Jim Cramer. The S&P 500 was little changed, while Intel fell more than 3% and was down nearly 10% for the week, the club said.
The weakness in chip stocks came as investors appeared to make room for SK Hynix, the South Korean memory-chip company that began trading on the Nasdaq on Friday, according to the CNBC Investing Club recap of its morning meeting. On CNBC’s “Mad Money” on Thursday, Cramer said investors interested in SK Hynix could begin with a medium-sized position, while keeping capacity to add if the shares declined, the club reported.
Intel was the semiconductor name drawing the club’s attention. Cramer told Jeff Marks on Friday morning that, absent trading restrictions, the club would have bought some Intel shares, according to the recap. The club said Intel has become one of Cramer’s favoured stocks, despite the recent pullback.
The stated case for Intel rested on two parts: expected demand for central processing units as artificial intelligence use shifts toward inference, and the company’s developing chip manufacturing operations. Inference refers to the stage in which an AI model applies what it has learned to handle prompts and generate responses, a process that can increase demand for computing capacity beyond the initial training phase.
The club said it had added to its Intel position on Monday and would consider buying more next week. It also said any trade by Cramer’s Charitable Trust would be preceded by a trade alert to subscribers, in line with the club’s stated procedures.
Earnings focus shifts to banks and health care
Three holdings in Cramer’s Charitable Trust are scheduled to report results next week, according to the CNBC Investing Club: Wells Fargo and Goldman Sachs on Tuesday, followed by Johnson & Johnson on Wednesday.
For Goldman Sachs, the club said it would look for commentary on investment banking after several transactions in the first half of the year. Deal activity is a key driver for investment banking revenue because banks earn fees from advising on mergers, underwriting securities and arranging capital markets transactions.
At Wells Fargo, the club said recent quarters had been “far from stellar” and that it needed to see improvement to support the stock’s place in the portfolio. The recap did not specify which metrics the club would use to assess the bank’s performance.
For Johnson & Johnson, the club said it would watch sales for the company’s core cancer and multiple myeloma treatments, along with newer products including Icotyde, described by the club as an oral solution for plaque psoriasis. The club said Johnson & Johnson shares had risen nearly 8% since the company’s last report in April.
Cramer’s Charitable Trust holds Wells Fargo, Goldman Sachs, Intel, Johnson & Johnson and Broadcom, according to the CNBC Investing Club. The club said Cramer waits 45 minutes after issuing a trade alert before buying or selling shares in the trust, and waits 72 hours after an alert if he has discussed the stock on CNBC television.
This story draws on original reporting from CNBC.
