Published: Saturday, September 6, 2025 · 4:34 PM | Updated: Saturday, September 6, 2025 · 4:34 PM
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The stock market kicked off the historically tough month of September on a rocky note as Wall Street speculated about the magnitude of the Federal Reserve’s next interest rate decision. Initially, the S & P 500 and Nasdaq hit all-time intraday highs Friday morning as investors digested a slower-than-expected August jobs growth . The weak data bolstered the case for the central bank to cut rates 25 basis points later this month, and as many as two more similar moves before year-end. The 10-year Treasury yield dropped below 4.1% to its lowest level since April. The “bad news is good news trade” was on. Shortly after the open, however, the market reversed lower as those rate cut hopes were overshadowed by concerns about the pace of the slowing labor market. Nonfarm payrolls increased by just 22,000 last month, versus the 75,000 expected, while July was revised up to a still tepid 79,000, and June was revised to show a loss of 13,000. While the S & P 500 and Nasdaq each closed Friday’s session slightly lower, both still managed to post gains of nearly 0.3% and more than 1%, respectively, for the week. .SPX .IXIC 5D mountain S & P 500 and Nasdaq 1 week Jim Cramer was not bothered by the market swings, saying Club name Home Depot is about to go even higher. “That’s what you buy right here, right now,” he said on Friday. Lower borrowing costs should be a catalyst for Home Depot shares because its business is heavily tied to a recovery in the housing sector. Home Depot stock has already been on the upswing since mid-June as rate cut expectations ramped up through the summer. Jim thinks the bond market might actually cooperate this time when the Fed starts cutting rates again — unlike last year, when bond yields, and subsequently mortgage rates, rose after 100 basis points of Fed rate cuts. So far, it looks promising, with the national average on a 30-year fixed-rate mortgage dropping by 16 basis points to 6.29%, its biggest single-day drop in more than a year. It wasn’t just monetary policy on the minds of investors. Corporate earnings were, too, including two of our holdings: Salesforce and Broadcom . The biggest earnings story of the week was Broadcom. Shares of the custom chipmaker gained over 9% on Friday after a blowout quarter the night before. Wall Street celebrated Broadcom’s upbeat guidance, CEO Hock Tan’s revelation about $10 billion in custom AI-related orders from a new customer, which analysts speculated might be OpenAI, and Tan saying he’s staying on as CEO “at least” through 2026. For the week, Broadcom was our biggest gainer, up 12.6%. AVGO YTD mountain Broadcom YTD “Broadcom’s great quarter, solid guide, and the CEO remarks on the call all pointed to sustained strong demand for artificial intelligence semiconductors and networking solutions, housed in the company’s AI solutions segment,” Zev Fima, a portfolio analyst for the Club, wrote in Thursday evening’s earnings analysis. “VMWare, the software giant Broadcom bought for $69 billion nearly two years ago, continues to power the company’s infrastructure software segment.” The Club raised its Broadcom price target to $350 from $290, and reiterated our hold-equivalent 2 rating . On Friday, Zev summed it up : “Taken together, it’s clear that despite all the hoopla about an artificial intelligence spending bubble, we’ve not yet seen the peak in AI demand when it comes to the real-deal players in the space.” Salesforce released a better-than-expected second-quarter report Wednesday evening. Although the company posted a beat on the top and bottom line, worries about a soft third-quarter revenue guide weighed on shares after the release. The stock dropped nearly 5% on Thursday but recovered more than half that on Friday. For the week, it lost just over 2%. CRM YTD mountain Salesforce YTD On earnings night, the Club lowered our price target to $300 from $350 due to the ongoing concerns around Salesforce’s growth trajectory. We did, however, maintain our 2 rating on the stock. After all, Salesforce’s suite of AI tools, dubbed Agentforce, could still boost topline performance, and management’s cost discipline could help margins over time. “However, the results here aren’t enough to silence the bears who believe the traditional seat-based software-as-a-service business model has peaked and is being disrupted by advancements in AI. It’s disappointing to continue to wait, but we’re not ready to jump ship on this small position just yet with the stock trading at 22 times forward earnings.” Jeff Marks, director of portfolio analysis for the Club, wrote in Wednesday evening’s earnings analysis. Also, in tech news, Apple investors received great news this week, which pushed the Club stock up more than 3%. That’s all because of a favorable ruling in Alphabet’s landmark Google Search antitrust case. Shares of the iPhone maker were on a tear after a federal judge ruled late Tuesday that Alphabet can keep making payments to preload Google Search onto Apple’s flagship devices. AAPL YTD mountain Apple YTD Jim thinks the ruling could unlock billions of additional revenue for Apple. Not only can Apple keep receiving the once estimated $20 billion each year in payments for its Google agreement, but it also opens the door for the tech behemoth to consider similar deals with large language model providers. As in, Apple could get paid for driving traffic to various AI chatbots within its ecosystem. This would be a sizable boost to Apple’s high-margin Services unit, which includes the App Store, Apple TV+, Apple Music, iCloud, and more. “That bot company will have to pay Apple because it’s legal,” Jim said during CNBC’s “Mad Money” on Tuesday. “What a turn of events. Maybe it’s another $20 billion headed Apple’s way. Maybe [it’s] more.” Jim also reiterated his long-held “own, don’t trade” thesis on Apple stock. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) 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. 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