Stocks extend their winning streak, Apple pops and the PC recovery continues

Published Wed, Jul 10 20242:40 PM EDT

Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. New highs (again): The market is extending its recent win streak, with the S & P 500 and Nasdaq rallying for the seventh session in a row. The gains picked up steam in the late morning to early afternoon as Federal Reserve Chair Jerome Powell answered questions from the House Financial Services Committee. Once again, Powell said a lot of the right things, acknowledging how the central bank now must balance risks of elevated inflation with economic activity and the labor market. Powell also said that the Fed won't wait until inflation reaches its 2% target before lowering interest rates. "If you waited that long you probably waited too long because inflation will be moving downward and would go well below 2%, which we don't want" Powell said. To start lowering rates, the committee wants to be confident that inflation is on the way to 2% — not that it has reached the target. PC recovery continues: We received two positive data points over the past two days confirming the PC recovery cycle is on track. On Tuesday IDC said the traditional PC market grew 3% in the second quarter, marking its second quarter of growth after seven straight quarters of decline. Gartner said Wednesday that worldwide PC shipments increased 1.9% in the second quarter, making it three straight quarters of year-over-year growth, according to its data. Gartner pointed out that the U.S. is one of the hotter markets, with shipment volumes hitting its highest figure since the third quarter of 2022. Commentary on artificial-intelligence PCs was limited since they just hit the market in June. Mikako Kitagawa, the director analyst at Gartner, said demand for these new PCs "has been slow" so far. We're not completely surprised to hear this because it will take time to educate the public on all the new AI features. Still, all signs point to a new product cycle that should last multiple years as people replace their pandemic-era computers for AI-embedded ones. These upgrades should help lift Best Buy 's comparable sales into positive territory in the second half of the year. We'll add to our position again should it fall below our buy level from last week . Apple pops : Apple extended its record-high streak after Bloomberg reported the company has told suppliers and partners it expects 10% growth in shipments of its new iPhone 16 this year compared with the 15 models in 2023. The article mentions that some of this is due to easier year-over-year comparisons, especially in China. Still, we've been more focused on an AI-driven upgrade cycle after seeing the features announced at the World Wide Developers Conference last month and learning any models below the 15 Pro cannot leverage the Apple Intelligence technology. While we are always wary about reporting on Apple and its supply chain, a story like this is what the market has anticipated with the stock up about 20% since the beginning of June. Up next: Costco reports its June monthly sales after the closing bell. Thursday morning we'll see the consumer price index (CPI) reading for June. The current consensus is for a 0.1% increase month over month and 3.1% increase year over year. An in-line-to-lower figure could give the Fed more confidence that inflation is making progress toward its 2% target, while an unexpected jump could cause some volatility in the markets. On earnings, Thursday is a big consumer package goods day, with PepsiCo and Conagra reporting results. We'll keep an eye on the pricing vs. volumes dynamic and the impact, if any, from GLP-1 usage. Delta Air Lines also reports. (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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Customers try out new iPhones at an Apple store as iPhone 14 series go on sale on September 16, 2022 in Nanjing, Jiangsu Province of China.

Vcg | Visual China Group | Getty Images

Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street.