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. Markets: The S & P 500 was higher in afternoon trading, as Wall Street patiently awaits any updates on the second day of U.S.-China trade talks in London. Earlier, we heard from Commerce Secretary Howard Lutnick that the talks were “going well.” But beyond that, updates have been sparse. Deals on tap?: There’s more growth ahead for Wells Fargo’s investment banking business now that the firm’s $1.95 trillion asset cap has been removed. On Tuesday, CFO Mike Santomassimo said that the firm’s seeing “green shoots in terms of deals.” That is, in part, because its budding capital markets business was “the most constrained” from Wells Fargo’s seven-year-long regulatory punishment, he said. “We just haven’t been able to allocate the balance sheet we would like to, to that business,” Santomassimo said during Morgan Stanley’s financial industry conference. “That business will have more flexibility now that the asset cap is gone.” The more clients that tap the bank for its advisory and underwriting services, the more fee-based revenues Wells Fargo can generate. Wells Fargo and fellow Club name Goldman Sachs will both benefit from an overall rebound in Wall Street dealmaking, which has for years been constrained by economic uncertainty and higher interest rates. The market for initial public offerings, in particular, is seeing signs of a revival. Crypto exchange Gemini announced plans to go public Friday in a new filing with the Securities and Exchange Commission. Stablecoin issuer Circle also had a successful public debut last Thursday, where shares advanced roughly 168% in a single session. All of this action will in turn encourage more companies to go public, according to Jim Cramer. “There’s project momentum over at Goldman,” he said Tuesday. “I think they are doing incredibly well.” Zuckerberg’s latest bet: Club name Meta Platforms is set to take a 49% stake in Scale AI for $14.8 billion, valuing the AI startup at just over $30 billion, The Information reported Tuesday. CNBC’s Deirdre Bosa later confirmed the report. While Meta has already realized significant financial benefits from its investments in AI — thanks to improved ad targeting and user engagement on Instagram and Facebook — its latest Llama 4 model has been trailing the competition when it comes to benchmark testing. Earlier on Tuesday, The New York Times reported that Meta is looking to establish a new “superintelligence” lab and bring in Scale AI CEO Alexandr Wang to help run it. So, what’s this all mean for us at longtime Meta investors? We like the move from CEO Mark Zuckerberg. While the price tag is certainly high, we think the payoff for leading in the era of AI will more than justify the spend. By building out increasingly advanced AI models, Meta stands to increase efficiencies internally — while also making consumer devices like its popular Meta Ray-Ban smart glasses more valuable and opening the doors to new opportunities like an AI subscription product down the road. On the other hand, with this news coming a day after Apple’s disappointing WWDC event , it only further cements our view that Apple needs to increase its focus and intensity on building out Apple Intelligence. As Jim argued on Tuesday’s Morning Meeting, Apple needs to consider whether its capital allocation priorities are aligned with this competitive moment. What Meta is doing here is what Apple needs to start thinking more seriously about. Rather than adding $15 billion to the buyback, Apple needs to go out and align itself with an AI leader. Microsoft teamed up with ChatGPT creator OpenAI many years ago. Amazon has invested heavily in Anthropic. Now, Meta is aligned with Scale AI. Go back more than a decade, and there was Alphabet’s transformational acquisition of Deep Mind. Sure, Apple has always preferred to be the one building over buying, but the iPhone maker may need to rethink that strategy this time around. So long as consumers remain loyal to Apple hardware, there is an opportunity to be a top player in the consumer AI race. However, the clock is ticking and Apple needs to put up some wins here while they still have the massive edge provided to them by their record-high installed base of active devices. Of course, any move from Apple would likely end up on the radar of antitrust regulators. And on that note, we are interested to see whether Meta’s investment in Scale AI draws any scrutiny. Large-cap tech has been weary of making such large investments given increased scrutiny from regulators in recent years and a more aggressive stance when it comes to enforcing antitrust regulations. That was the case under the previous Biden administration and current Vice President JD Vance certainly hasn’t hidden his issues with the power large-cap tech wields. Nonetheless, should Meta’s investment go through without issue from regulators, it may well prove another signal that more M & A is set to hit the market in the future. Up next: Dave & Buster’s , GameStop , Gitlab and Stitch Fix are set to report earnings after the closing bell Tuesday. Of those, we’re most interested in what Dave & Buster’s has to say about consumer spending patterns. On Wednesday morning, we’ll start the day with Nvidia CEO Jensen Huang’s keynote address at the company’s GTC Paris event — it’s slated to kick off at 5 a.m. ET. We’ll be on the look out for any announcements coinciding with the keynote around European “sovereign AI” initiatives, which are emerging as key growth driver for the chipmaker. The other main event Wednesday is the consumer price index report, which is due out at 8:30 a.m. ET and will provide investors a look at how tariffs are impacting inflation trends. (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.
