The market's early rally fizzles — plus, why TJX's modest dividend still matters for investors

CNBC Finance

4 min read

Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch â an actionable afternoon update, just in time for the last hour of trading on Wall Street. The S & P 500 struggled to hold on to its gains to start the holiday-shortened week of trading. After a nice early morning pop following President Donald Trump's latest comments on the war in Iran, the market reversed and was led lower by the tech-heavy Nasdaq. U.S. oil benchmark West Texas Intermediate crude climbed back above $100 per barrel, up more than 3% on the day. In the current environment, bond prices tend to fall, pushing higher yields, when oil rallies because rising energy costs fuel inflation concerns. In his Sunday column , Jim Cramer noted that these rising bond yields are yet another headwind for some stocks during the war. On Monday, at least, the move in oil isn't corresponding with a jump in bond yields. The yield on the 10-yearTreasury note is down about 10 basis points to around 4.32% after Federal Reserve Chair Jerome Powell poured cold water on the idea that a short-term spike in energy costs will require an interest rate hike. While the broader market drops slightly, the AI buildout part of the portfolio is experiencing more meaningful declines. Broadcom , Eaton , GE Vernova , Corning , Nvidia and Qnity Electronics were all lower. Other AI-related stocks outside our portfolio â including Micron , Lam Research , Applied Materials , CoreWeave and Vertiv â also traded lower. Corning, GE Vernova, Eaton, and Qnity traded higher last week, so it's possible Monday's move is simply a rotation into more beaten-down groups like software, which is catching a bid. Palo Alto Networks , CrowdStrike and Salesforce were the three biggest gainers in the portfolio on Monday. But one could also argue that OpenAI's sudden decision last week to shut down its Sora video-generation app is a sign that AI companies are starting to become more deliberate and rational about how they spend and allocate compute. TJX Companies announced it raised its quarterly dividend by 14% to $0.48 per share. The bump marked TJX's 29th dividend increase over the last 30 years. The company also said it plans to repurchase about $2.50 billion to $2.75 billion of stock in the current fiscal year. Neither update is new information â management announced these plans last month when it reported its fourth-quarter results. Still, increased capital returns to shareholders signals confidence in future earnings and cash flow growth. TJX isn't exactly an income stock, with its new implied annual dividend yield at roughly 1.2%. But the long-term benefits of steadily growing payouts shouldn't be ignored. Consider this: TJX shares have risen 298% over the past decade. On a total return basis, which includes reinvested dividends, the stock has advanced 358%. That difference is meaningful. TJX shares are up slightly on Monday and have risen about 2% year to date, outperforming what's been a difficult tape for retail. We attribute TJX's steady gains to its consistent execution and off-price model , which delivers quality brands at discounted prices to value seeking shoppers. There are no major earnings reports after the closing bell on Monday. Spike maker McCormick and financial data provider FactSet report before the opening bell on Tuesday. On the data side, there's the Consumer Board's monthly survey on consumer confidence and the so-called JOLTS report, which measures the number of job openings in the U.S. economy. (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.

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The market's early rally fizzles — plus, why TJX's modest dividend still matters for investors

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