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. Market moves: The S & P 500 was on track for small gains following a solid rally last Friday. There’s still some market rotation happening, but this time it’s the opposite of the flight from tech that dominated the past few weeks. The so-called Magnificent Seven stocks — six of which we own Apple , Alphabet , Amazon , Meta Platforms , Microsoft and Nvidia — performed better Monday. The small caps, measured by the Russell 2000 , lagged. Month to date, the Russell is up nearly 9%, the Dow is up 3.5%, the S & P 500 is basically flat, and the Nasdaq is down nearly 2%. Trial verdict: We are encouraged by how shares of Club name Abbott Laboratories have moved well off their morning lows despite being ordered to pay $495 million in its premature baby formula verdict. The minor pullback could be a sign that the bad news was already priced in given the tens of billions in market capitalization already lost since March. Or it could be a sign that Wall Street recognizes the joke this verdict was. Abbott CEO Robert Ford believes that pulling these products would cause a public health crisis. What other option does Abbott have to limit its litigation risk? If the stock is only down 1% on this bad news, we can’t help but wonder what the upside would be if they start winning cases or if there’s a settlement. Abbott is still far away from either happening, but this type of exercise helps frame our risk/reward going forward. IPO talk: Late Friday, Club name Honeywell shares briefly popped a few percent on a story from Bloomberg that said the company is considering an initial public offering of its quantum computing business Quantinuum as soon as next year. The valuation that was talked about was around $10 billion. We see a move like this as a slight positive and possible recognition that Honeywell plans to monetize this business at a growing valuation. But we’re not surprised to see the stock quickly give back those gains.
