The bulls got what they wanted this week: cooler inflation data and record highs. The Dow Jones Industrial Average on Friday closed above 40,000 for the first time, capping a 1.24% advance for the week. Meanwhile, the S&P 500 and Nasdaq Composite closed at all-time highs on Wednesday, buoyed by cooler-than-expected inflation data released before the bell that day. Movements in indices were calm, but mixed, during the last two trading days of the week. Both finished Friday just below Wednesday's highs. Over the course of the week, the S&P 500 added 1.54% while the Nasdaq, which is dominated by technology stocks, rose 2.1%. The market moved into extremely overbought territory during the week, forcing the club to maintain our discipline. We reduced shares of our positions in Morgan Stanley and Palo Alto Networks on Wednesday and Thursday, respectively, after good moves higher for both stocks. On the other hand, we bought additional shares in Estee Lauder on Tuesday after seeing some positive signals from the key Chinese market for cosmetics retailers. Here's a closer look at what drove the moves in the five largest stocks in the portfolio this week. Mountain Palo Alto Networks' (PANW) YTD PANW Performance YTD Palo Alto Networks came in first for weekly gains, jumping 6.9% during the period. The cybersecurity stock had a particularly strong session on Wednesday, adding 3.57%, after Morgan Stanley issued another upbeat note on the company ahead of its quarterly earnings report Monday night. The stock received an additional boost Thursday after news of a strengthened partnership with IBM, which would give Palo Alto access to a larger customer base. Palo Alto has been significantly outperforming since early April, which took into account Thursday. We remain bullish long-term in Palo Alto. DHR Year-to-date Mountain Danaher (DHR) Danaher's performance advanced 4.9% on the week to secure second place. Shares are on a four-session winning streak, hitting a string of 52-week highs, including Friday. The stock is now trading at levels last seen in October 2021. The biggest catalyst this week was the positive presentation the company made Tuesday at Bank of America's healthcare conference. CEO Reiner Blair reiterated what was said during a better-than-expected quarterly earnings report in April, with encouraging remarks about inventory depletion in its bioprocessing business. Danaher's recent rise — up 11% over the past month — demonstrates the benefits of continuing to invest in a well-managed company that is navigating its way through inventory challenges. Mountain Broadcom (AVGO) Year-to-Date AVGO Stock Performance. Broadcom took third place, up 4.7% this week. Its strong performance included a record close on Wednesday of $1,436.17 per share. There was no single catalyst for Broadcom's advance this week. But AI-related announcements from ChatGPT maker OpenAI on Monday, and Google's later I/O developers conference, will likely fuel the chipmaker's shares (more on Google in a second). Broadcom has been a big beneficiary of the AI trade in 2024, with shares up 25% year to date versus the S&P 500's gain of 11.2%. Broadcom has been involved for years in designing Google's in-house AI chip. GOOGL YTD Mountain Alphabet (GOOGL) Year-to-Date Performance Alphabet came in fourth for gains as shares rose 4.4% this week. The stock closed at record highs in three straight sessions, sparked by Google-owned Alphabet's annual I/O developers conference on Wednesday. Management unveiled a host of new generative AI products at the event, renewing investor confidence in Alphabet's position in the frenetic AI arms race despite numerous missteps since ChatGPT's launch in late 2022. Wall Street analysts were optimistic about the updates, and we're relieved And about what we heard as well. AAPL Year-to-Date Apple (AAPL) Year-to-Date Performance Apple holds the top five spots, with its shares up 3.7% during the period. It's difficult to pin down Apple's performance in one event. But the tech giant has been on a tear since the company's quarterly earnings report on May 2, up nearly 10%, after management hit the top and bottom line despite concerns about its China business. The iPhone maker also announced its largest corporate buyback ever, with a massive $110 billion stock buyback authorization. Investors have also recently received several signs that Apple is taking artificial intelligence seriously. Recent updates from OpenAI and Google could also serve to boost sentiment, given previous reports that the iPhone maker may partner with one of them for its latest iPhone software system. (Jim Cramer's Charitable Trust Long PANW, MS, EL, DHR, GOOGL, AVGO, AAPL. See here for complete list of stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim takes a trade. Jim waits 45 minutes after a trade alert is sent before buying or selling a stock in his charitable fund's portfolio. If Jim talks about a stock on CNBC TV, he waits 72 hours after the trade alert is issued before executing the trade. The above Investment Club information is subject to our Terms and Conditions and Privacy Policy, as well as our Disclaimer. No obligation or fiduciary duty exists or is created by your receipt of any information provided in connection with the Investment Club. No specific results or profits are guaranteed.
Traders work on the floor at the New York Stock Exchange in New York City, US, May 15, 2024.
Brendan McDiarmid | Reuters
The bulls got what they wanted this week: cooler inflation data and record highs.
