What’s driving Wednesday’s market recovery — listen to ‘The Homestretch’

Here’s the transcript for “The Homestretch” for Wednesday.>>> JIM CRAMER, JEFF MARKS, HOME STRETCH WHERE WE TALK ABOUT THE IDEA THAT SOME PARTS OF THE MARKET COULD BE BETTER AND WHEN IT WAS UGLY, LOOKS LIKE THAT’S DEVELOPING.THE MIGHTY DOW AS BEING SOMETHING THAT’S UNDERVALUED HERE HAS COME ALMOST ALL THE WAY BACK.EVEN MICROSOFT.IT WAS DOWN 5.7%.IT’S COME BACK, GIVEN THE FACT THAT THE DECLINE THIS MORNING WAS SO HIDEOUS.JEFF, YOU’VE GOT TO FEEL EMBOLDENED ABOUT WHAT WE’RE SEEING.>> LOOK, I THINK THE MARKET THAT, A LOT WAS DRAGGED DOWN BY MICROSOFT.OF COURSE, THEY GAVE A SOFTER THAN EXPECTED GUIDE.A LOT HAD TO DO WITH THE DECELERATION IN AZURE.WHAT DOES THAT HAVE TO DO WITH A HEALTHCARE COMPANY LIKE JNJ?A PROCTOR AND GAMBLE?WE ADDED TO OUR POSITION TO TODAY.WE’RE SEEING BOUNCEBACKS IN THOSE STOCKS AS WELL.WE’RE ABOUT A FIFTH THROUGH EARNINGS SEASON.95 COMPANIES IN THE S&P 500 HAVE REPORTED.SO YEAH, WE’LL CONTINUE TO DIGEST MORE EARNINGS REPORTS.AS THEY COME THROUGH.>> THAT WILL BE THE S UBJECT ON MAD MONEY, BUT YOU MENTIONED PROCTOR AND GAMBLE.WE FOLLOWED UP ON THAT AND BOUGHT HALF OF WHAT WE SOLD.NOW, I JUST WANT TO, WE GOT A GREAT QUESTION FROM A VIEWER/LISTENER TALKING ABOUT WHAT, GO AHEAD.I CAN FILL IN.>> A DISCIPLINE OF OURS IS THAT WHEN THE MARKET IS OVERBOUGHT ACCORDING TO THE S&P OSCILLATOR, WE LOOK FOR THINGS TO SELL.NOT BUY.JUST LIKE WHEN THE MARKET IS OVERSOLD, WE LOOK FOR THINGS TO BUY BECAUSE IT’S TOO LATE TO SELL.SO ONE OF OUR ASTUTE CLUB MEMBERS ASKED WHY ARE YOU PUTTING MONEY TO WORK WHEN THE MARKET IS STILL TECHNICALLY SAID TO BE OVERBOUGHT?IT’S A CROSS DISCIPLINE AS YOU AND I WERE DISCUSSING IN THAT WE SAID 140, WE’D LOOK TO BUY IT.WE LIKE TO BUY THINGS THAT ARE DOWN.IT’S ALSO ANOTHER CROSS DISCIPLINE THAT’S BEEN HIT HARD OVER THE LAST COUPLE OF WEEKS.REALLY THE BUSINESS IS DOING WELL.WE’LL LOOK FOR THAT AS AN OPPORTUNITY TO BUY MUCH LIKE PROCTOR HAS IN ITS ROTATION OUT OF BE DEFENSIVE STOCKS. THAT PLAYED INTO THE THINKING.>> YEAH, THEN JEFF MENTIONS CROSS DISCIPLINE, TALK ABOUT THE VARIATIONS WHICH IS SOMETHING I LEARNED ON THE TRADING DESK WHICH IS THAT WHEN YOU HAVE TWO DIFFERENT COST DISCIPLINES, YOU AGREE AT A HIGHER PRICE IF PROCTOR WERE TO COME DOWN TO SAY 140, YOU BUY. YOU HAVE TO SAY WHICH IS THE TOUGHER OF THE TWO.I THINK THE MOST FURER WOULD BE REWARDED FOR THAT WHAT I SAY IS A GUTSY MOVE BUT THAT’S OKAY.SOMETIMES YOU’VE GOT TO MAKE GUS GUTSY MOVES.>> ESTEE LAUDER, WE WERE BUYING ALL THE WAY TO THE 180s.RESTRICTED FROM BUYING THERE, BUT RECOMMENDED BUYING THERE ON THAT EARNINGS REPORT SELLOFF.IT’S BEEN NICELY REWARDED IN THE RUN UP.>> SAME THING WITH WELLS HERE.WE GOT A TERRIFIC REPORT FROM A US BANK CORP., LIKE A MINI WELLS.>> YOU GOT THE FINANCIALS DOING WELL TODAY.>> REMARKABLE QUARTER.VERY FEW BAD ONES.>> MATERIALS DOING WELL, TOO, BOOSTED BY A NICE MOVE IN THE MINOR FREEPORT McMARAN.PERHAPS CATERPILLAR IS WORKING.>> SECOND TO MINERALS AND METALS SO I THINK ONCE AGAIN, IT’S NOT THE REASON. PAT CAR REPORTED. PETERBUILT A ND KENWORTH.THEY’RE CLOSELY AFFILIATED WITH A CATERPILLAR ENGINE.NOW I WANT TO TALK FOR A SECOND ABOUT HOW WE RUN THROUGH THINGS.JEFF AND I BOTH FEEL THAT IT’S IMPORTANT THAT YOU SEE THE TOP FIVE OF OUR PORTFOLIO AND THE BOTTOM FIVE SO YOU UNDERSTAND WHAT WE THINK COULD HAPPEN AFTER THE CLOSE AND ALSO OF COURSE AFTER THE MORNING MEETING.WELLS FARGO I THINK IS ABSOLUTELY TERRIFIC.I THINK IT’S ABOUT TO MAKE ITS MOVE OUT OF 44.IT’S UP NICELY SINCE THEY REPORTED NOTHING IN THERE’S THAT TELLS ME THAT FIVE YEARS AFTER THE CONSENT DECREE WHEN THEY WERE FIRST SANCTIONED MIGHT CATCH A BREAK HERE FIVE YEARS LATER. WHAT ABOUT HALLIBURTON.>> INTERESTING MOVE TODAY IN HALLIBURTON. PROBABLY AROUND THE TIME WE WERE TALKING IN THE MORNING MEETING, IT WAS HITTING A LOW OF AROUND 38.50 AND NOW IT’S BACK UP ABOVE 40.THAT WAS A REALLY GREAT QUARTER THEY REPORTED YESTERDAY.I THINK IT WAS JUST SOME PROFIT TAKING BUT IT LOOKED LIKE ONE OF THE BEST OF THE LARGE CAP OIL SERVICES COMPANY.THE OTHERS VMS AND BAKER HUGHS.A BIG INCREASE TO THE DIV.MULTIYEAR CYCLE AHEAD.>> WE WANT TO STICK WITH THAT.IF IT PULLED BACK, WE’D BUY MORE.>> YES, AND IN THE COHORT OF HEALTH MAINTENANCE, HEALTH INSURANCE, WE GOT GOOD NEWS WITH HUMANA.>> ONE OF THEIR PEERS REPORTED SOLID NUMBERS.THE FUNDAMENTALS FOR MANAGED CARE HAVE BEEN THERE.UNH HAD A GOOD QUARTER.THESE STOCKS HAVE BEEN OUT OF FAVOR, BUT OVER TIME, THE FUNDAMENTALS ALWAYS COME BACK. >> JUST SOME QUESTIONS ABOUT BUYING THIS. MAYBE A MORE TASK MASTERS PRESIDENTIAL CANDIDATE BUT I THINK HUMANA’S SENSATIONAL.IT LOOKS LIKE THE DOLLAR TREE COMPONENT OF THE MARKET IS DOING WELL, WHICH TJX.WE’VE SEEN MEDIA STOCKS WORK TODAY.NEWS CORP .I LIKE DISNEY.ONCE AGAIN, THAT DISNEY, BOB IGER COMING OUT SWING STORY HAS SOME LEGS.>> I THINK SO.ESPECIALLY IF THEY CAN CUT DOWN COSTS IN THE DIRECT TO CONSUMER BUSINESS MUCH LIKE THAT NOTE FROM WELLS FARGO YESTERDAY SUGGESTED THEY COULD.NOW ON THE DOWNSIDE, ALPHABET MOVING LOWER.AZURE, PERHAPS VOLATILITY FROM THE DEPARTME NT OF JUSTICE LAWSUIT THAT WAS ANNOUNCED YESTERDAY.>> GOT TO STICK WITH IT.I KNOW THIS IS VERY DIFFICULT.WHAT WE KNOW IS PROBABLY WHEN YOU ASKED ANYONE OF MAJOR CONGLOMERATE COMPANIES, WHAT THEY MOST ADMIRE.IT’S GOING TO BE DAN.THIS IS A STOCK THAT PERIODICALLY ACTS POORLY.YOU CAN’T AFFORD TO WALK AWAY.>> ESPECIALLY BECAUSE I THINK EVERYONE IS LOOKING FOR OKAY, IN SOME OF THESE BUSINESSES THAT HAD A CYCLICAL COMPONENT, WHEN IS THE TROUGH.WHEN DO THINGS REACCELERATE? THEY SAID THE FIRST QUARTER IS GOING TO BE THE TROUGH OF INFLECTION POINT FOR THE INVENTORY DESTOCKING.LOOK, EARNINGS ARE GOING TO IMPROVE THROUGHOUT THE YEAR SO I THINK THE STOCK WILL WORK.>> ESTEE LAUDER I MENTIONED ON THE MORNING MEETING’S NOT THERE NEGATIVE.I THINK IT’S JUST SELLING, DOWN FIVE, SIX IN THE MORNING MEETING.AS A BUYING OPPORTUNITY.A STORY I’M REALLY ANGRY ABOUT, WHICH IS SOMEONE PUT OUT A SELL ON PIONEER.I’VE KNOWN PIONEER FOR ABOUT I DON ‘T KNOW, 15 YEARS. THIS IS THE MOST DISCIPLINED AND BEST OIL C OMPANY THERE IS WITH PROPERTIES AND I REALLY DISLIKE THIS WHOLE USE OF WELLS FARGO CALL.I THINK THEY’LL BE VERY WRONG AND YOU’LL BE VERY RIGHT IF YOU BUY IT.JUST ONE QUICK POINT THAT’S HAPPENED.I WAS VERY BULLISH ON BOEING THIS MORNING.I INTERVIEWED THEM ON SQUAWK ON THE STREET.HOW ABOUT TONIGHT?>> A LOT OF BIG EARNINGS.TESLA, THAT WILL GIVE US A READ ON AUTOS AND PERHAPS A VIEW ABOUT HOW FORD IS DOING.LAM RESEARCH ON CHIP DEMAND. THE SEMICONDUCTOR READ THROUGH.LAS VEGAS SANDS, THAT WILL GIVE US INSIGHTS AS TO WHAT’S GOING ON IN McKAU, HOW’S THE RECOVERY LOOKING ESPECIALLY FOR THE SECOND HALF OF THIS YEAR WHEN THINGS IN CHINA SHOULD REALLY PICK UP.AND UNITED RENTALS ON CONSTRUCTION. STATES.THAT’S A NICE READ THROUGH INTO CATERPILLAR.>> I WANT TO GO OVER ON TESLA WHAT I DO FEAR IS THE CUTS HAVE MADE IT, PRICE CUT, HAS MADE IT SO THAT THE FORD IS GOING TO HAVE TO CUT AND THAT’S NOT GOOD FOR FORD.TAKE THE GOOD WITH THE BAD.WHAT I WANT TO SEE IS THAT THERE’S GREAT DISCIPLINE AMONG THE MICRONS OF THE WORLD TO NOT ORDER MORE EQUIPMENT.THEY SAY GOOD THINGS ABOUT INVENTORY.I THINK THAT ONE ROARS THEN FINALLY, UNITED RENTALS ONCE I MENTIONED ON AIR, WE DON’T USE CAT.OKAY.IT DOESN’T MATTER.I THINK A LOT OF PEOPLE GET THROWN OFF BY MANAGEMENTS TRYING TO PROTECT THEIR OWN TURF WHEN CATERPILLAR IS THE BEST READ THROUGH AND BE FANTASTIC.TOMORROW.>> QUICK LITTLE PROGRAMMING NOTE.THE HOMESTRETCH WILL BE PUBLISHED SLIGHTLY LATER IN THE AFTERNOON BUT SOON ON THE WEBSITE WITH PLENTY OF TIME TO HELP YOU UNDERSTAND THE DAY’S ACTION AND NAVIGATE FINAL TRADING. JUST A ONE-DAY THING.>> JUST SOMETHING JEFF AND I WERE TALKING, WE HAVE, WE GOT THIS AEROSPACE BULL MARKET IS EXTRAORDINARY, RATHEON. IT’S EXTRAORDINARY.IT’S LONG LASTING AND AS LONG AS TRAVEL REMAINS BULLISH, WHICH I THINK IT IS, WE GOT TO BE BUYERS.MILITARY SIDE.SO I WANT TO REMIND PEOPLE GET LITTLE LATER TOMORROW AND I HOPE YOU ARE PLEASED, GIVE US ON THE FEEDBACK YOU CAN ON THE HOMESTRETCH BECAUSE IT’S A VERY IMPORTANT SO MUCH PIECE OF THE PACKAGE OF BEING A MEMBER OF THE CNBC INVESTING CLUB. THANK YOU.

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