Friday’s market rally is pushing the major U.S. stock benchmarks into positive territory for the week, with Apple leading the way with a more-than-7% rally in reaction to better-than-expected earnings. The company’s upbeat guide for the June quarter and anticipation of new generative artificial intelligence features for the iPhone at its World Wide Developer’s Conference in June are also driving the stock higher. Despite a 2% gain for the tech-heavy Nasdaq, Alphabet’s shares were slightly lower on Friday, possibly influenced by Apple’s AI commentary the night before. The rest of the market also got a lift on Friday after Treasury yields dropped in response to the softer-than-expected April jobs report, easing concerns about further tightening from the Federal Reserve.
Coterra Energy held its first-quarter earnings call on Friday following its better-than-expected results, with the company remaining disciplined about natural gas production based on market economics. Despite a 5% surge in natural gas prices on Friday, they have still fallen significantly year to date. Coterra CEO Tom Jorden is optimistic about future demand as additional liquified natural gas export capacity is added in the U.S. and more data centers are built. The Club believes the market may be underappreciating Coterra’s ability to adjust production in favor of oil and management’s willingness to increase share repurchases if the stock continues to trade at a low level. Coterra repurchased $150 million worth of stock in the first quarter and sees value in its own stock. Shares of Coterra rose about 3% on Friday, outperforming energy stocks as the only S&P 500 sector in the red that day.
Diamondback Energy is another strong oil stock this year that Jim Cramer is eyeing as a potential addition to the Club’s portfolio. With oil potentially bottoming out, Diamondback is on the Club’s Bullpen watchlist, which includes stocks considered for the portfolio but with no guarantee of inclusion. Looking ahead, with Cinco de Mayo approaching, good weather could benefit Constellation Brands, which dominates the holiday with its portfolio of Mexican beers. Earnings are expected to slow next week, with Disney’s report on Tuesday being a highlight. The company recently won a proxy fight against activist Nelson Peltz but must continue to focus on reducing costs, improving efficiencies, and investing in growth partnerships. Subscribers to the CNBC Investing Club will receive trade alerts before Jim makes a trade, with specific waiting periods in place to avoid conflicts of interest or insider trading. No specific outcome or profit is guaranteed, and members are subject to the Club’s terms, conditions, and privacy policy.
Overall, the market saw a positive rally on Friday, driven by strong performances from Apple and Coterra Energy. Other stocks, including Alphabet and Diamondback Energy, were also in focus as potential plays for the CNBC Investing Club. Looking ahead, weather could impact trading for Constellation Brands around Cinco de Mayo, while Disney’s earnings report on Tuesday will be closely watched. Subscribers will receive trade alerts before Jim Cramer makes a move, ensuring transparency and accountability in the Club’s investment decisions. While market conditions are always subject to change, the Club remains vigilant in seeking out opportunities for growth and value in the stock market.
