Shortly after the opening bell, we’re selling 100 shares of Morgan Stanley at roughly $101 each. Following Thursday’s trade, Jim Cramer’s Charitable Trust will own 900 shares of MS, decreasing its weighting to roughly 2.65% from roughly 3%. Stocks were poised to open sharply higher Thursday, with the S & P 500 indicating a gain of more than 1.5%, one day after the Federal Reserve cut interest rates by 50 basis points and forecasted more easing before the end of the year. The S & P 500 gave up post-Fed gains Wednesday and closed modestly lower. Morgan Stanley should have a decent pop when trading opens because lower interest rates should boost parts of its business , including investment banking. Morgan Stanley’s roughly 3.7% annual dividend yield also looks a lot more attractive when rates fall . However, for about a week now, we have been talking about taking off some Morgan Stanley as we debate whether to switch the position to a different financial like Goldman Sachs with more leverage to the investment banking cycle. MS YTD mountain Morgan Stanley YTD We thought Morgan Stanley’s share price was too low to sell when we held our September Monthly Meeting last week. But that was when it traded below $97 per share. Based on premarket prices, Morgan Stanley shares were hovering around $101, representing a much better level to take some off. One more factor behind our trim is that the S & P Short Range Oscillator remained in overbought territory after Wednesday’s close. We don’t like to anticipate what the Oscillator will do next. But we have to imagine that it will become even more overbought if the stock market’s opening gains hold. Whenever the Oscillator signals an overbought market, it’s our investment discipline to raise some extra cash. We’ll realize a tiny gain of about 1% on stock purchased in November 2021. (Jim Cramer’s Charitable Trust is long MS. See here for a full list of the stocks.) 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.
We’re trimming a bank stock on a post-Fed pop and still considering swapping it for another
