The month of September has proven to be challenging for the stock market, with the S&P 500 down approximately 1.7% on Friday and on pace for its fourth consecutive day of declines. The Nasdaq Composite is also lower by roughly 2.5%, with semiconductor firms experiencing heavy selling pressure. Broadcom’s earnings report on Thursday caused its stock to drop more than 9% on Friday, contributing to the overall decline in the technology sector. A popular exchange-traded fund for chip stocks is also down more than 11% over the past four sessions, tracking for its worst week since January 2022.
The August jobs report contained relevant news for Club holding Constellation Brands, as it revealed that while the broader unemployment rate decreased, it actually rose to 5.5% for Hispanic and Latino workers. Constellation Brands, which self-reports that more than half of its customer base are Hispanic Americans, lowered its beer net sales guidance earlier in the week, citing an increase in unemployment. Despite issuing a more subdued sales outlook, shares of Constellation surprisingly climbed 2.5% during Tuesday’s market sell-off. This move was seen as a “buy the confession” reaction from investors, who anticipated weakness and a broader shift into defensive stocks like consumer staples.
In the upcoming week, only three companies in the S&P 500 are scheduled to report earnings: Oracle, Kroger, and Adobe. Economic reports on the consumer price index, producer price index, and initial jobless claims will also be closely watched. The CNBC Investing Club will hold its September Monthly Meeting on Thursday at noon ET, where members can stay informed about market updates and potential investment opportunities. As a subscriber to the club, members receive trade alerts before Jim Cramer makes a trade, with a waiting period before executing the trade to ensure transparency and fairness.
Despite the current market challenges, Jim Cramer remains optimistic about the potential for Constellation Brands to gain market share and experience a free cash flow inflection once its current investment cycle in manufacturing capacity is completed. The club will continue to monitor Hispanic employment trends and their implications for Constellation’s key customer demographic. Defensive stocks like consumer staples tend to perform better during times of economic uncertainty, which may explain why shares of Constellation and other defensive stocks are holding up better than the overall market.
Overall, the CNBC Investing Club provides subscribers with timely updates and analysis to help navigate the complexities of the stock market. By following Jim Cramer’s guidance and trade alerts, members can make more informed investment decisions and stay ahead of market trends. The club emphasizes the importance of following the terms and conditions, privacy policy, and disclaimer, as it does not guarantee specific outcomes or profits. Members have access to valuable insights and recommendations to help them achieve their investment goals in a constantly evolving market environment.
