Every weekday, the CNBC Investing Club with Jim Cramer will be hosting a “Morning Meeting” livestream at 10:20 am ET. Here’s a recap of Monday’s key moments. The Market Needs a Break Why Jim Invests in the Two-Year Treasury Quick Lists: JNJ, LLY, AMZN, QCOM, DHR reached an 11-year high of 3.5% before declining again. Jim Cramer said rising bond yields — especially the 2-year bond, which were already at 2007 highs and approaching 4% — indicate that the Federal Reserve’s projected 75 basis point rate hike at this week’s meeting won’t be the last. will be. A move of that magnitude would be the third meeting in a row of 75. Jim said that in addition to the Fed’s tightening campaign to contain inflation, equities still face two other major challenges: the Russian war in Ukraine and the ongoing Covid lockdowns in China. “You can’t have all three going at once. If you want to bottom out, you need some break,” he said, thinking the Fed will likely be the first to break through. It’s worth noting that the S&P 500 was still around 6% from its mid-June bottom, which has held its lowest level of the year so far. 2. Why Jim’s Buying 2-Year Treasuries Jim stuck to his decision to buy 2-year Treasuries because he believes yields have become more competitive with stock returns. As a reminder, Jim cannot buy individual stocks with his own money under the rules for financial journalists at CNBC. One driving reason behind his confidence in 2-year Treasuries is his belief that the Fed will not raise the fund’s red yield above 4% as the economy shows more signs of slowing down. So if the Fed does 75 basis points this week, that would bring the target range for federal funds to 3% – 3.25%. The Club is in a waiting pattern for the Fed meeting – and because the S&P 500 Short Range Oscillator shows the market is not oversold yet, despite last week’s crushing drop. Usually we wait for the oversold signal from the Oscillator before thinking about buying. 3. Quick Listings: JNJ, LLY, AMZN, QCOM, DHR We have advice for new club members who may be looking to add to their portfolio. “I would buy Eli Lilly (LLY) and Amazon (AMZN) and do it here without hesitation,” Jim said, adding that he would also pick up shares of Johnson & Johnson (JNJ) if he didn’t already have one. He also said he would buy shares of Qualcomm (QCOM), which has its Automotive Investor Day later this week. As for Danaher (DHR), the stock currently offers the best value in the Club’s portfolio, Jim said. (Jim Cramer’s Charitable Trust is long JNJ, LLY, AMZN, QCOM, DHR. See here for a full listing of the stocks.) As a CNBC Investing Club subscriber with Jim Cramer, you’ll receive a trade warning before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a share in his charity’s portfolio. If Jim has talked about a stock on CNBC TV, he will wait 72 hours after issuing the trade warning before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH OUR DISCLAIMER. NO CONFIDENTIAL OBLIGATION OR DUTY EXISTS OR IS CREATED BY YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO PARTICULAR OUTCOME OR PROFIT IS GUARANTEED.
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