Raphael Stevens

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    Charts suggest 'it's going to be a very nice summer' for stocks, Jim Cramer says

    Monday – Friday, 6:00 – 7:00 PM ET

    CNBC’s Jim Cramer explained technical analysis from veteran chartist Larry Williams that suggests the market’s recent rebound could last for the next few months.
    “Larry Williams perfectly called the bottom the week before last. Now his analysis suggests we’ve got a lot more room to run,” Cramer said.
    “He thinks this is not just a short-term bounce, it’s a move that could last through the end of August,” the “Mad Money” host said.

    CNBC’s Jim Cramer explained technical analysis from veteran chartist Larry Williams that suggests the market’s recent rebound could last for the next few months.
    “Larry Williams perfectly called the bottom the week before last. Now his analysis suggests we’ve got a lot more room to run. He thinks this is not just a short-term bounce, it’s a move that could last through the end of August,” the “Mad Money” host said.

    The Dow Jones Industrial Average and the S&P 500 last week saw their best weekly gains since November 2020, though the three major indices, including the Nasdaq Composite, are well below their highs. 
    To explain Williams’ analysis, Cramer first examined the monthly chart of the S&P 500 going back to 2008:

    Arrows pointing outwards

    The vertical red lines indicate moments where 95% of the index advanced, according to Cramer. He noted there were six instances since 2008 before last week, with each instance a buying opportunity.
    “If history’s any guide, this kind of swift rebound should be a major inflection point for our beaten-down stock market,” he said. “According to Williams, we’re dealing with a very bullish situation here. In other words, he thinks last week’s gargantuan rally may be the beginning, not the end.”
    Further supporting Williams’ prediction that the market’s rally will last is a 12-year cycle he’s noticed for rebounds in the Dow, Cramer said.

    Here’s the chart:

    Arrows pointing outwards

    “The last time this 12-year cycle predicted a major move off the bottom was none other than 2010, which turned out to be an excellent time to buy. Now it’s 12 years later … we had a monster move last week,” Cramer said, adding Williams sees an “extremely bullish sign.”
    Williams noticed yet another pattern  — this one a dominant 75-day cycle in the Dow — that shows that the market is due for a rally through Sept. 1, according to Cramer.

    Arrows pointing outwards

    “In short, he thinks it’s going to be a very nice summer,” the host said.
    Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.
    Disclaimer

    Questions for Cramer?Call Cramer: 1-800-743-CNBC
    Want to take a deep dive into Cramer’s world? Hit him up!Mad Money Twitter – Jim Cramer Twitter – Facebook – Instagram
    Questions, comments, suggestions for the “Mad Money” website? [email protected]

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    Cramer's lightning round: Century Aluminum is not a buy

    Monday – Friday, 6:00 – 7:00 PM ET

    It’s that time again! “Mad Money” host Jim Cramer rings the lightning round bell, which means he’s giving his answers to callers’ stock questions at rapid speed.

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    Roblox Corp: “I can’t recommend a stock that is not making money.”

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    Li-Cycle Holdings Corp: “I’m not going to go there. We’re dealing with a lot of peaking of a lot of different metals. I’m staying away.”

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    Mitek Systems Inc: “I have work to do. … Let me do more work [researching the company].”

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    Bausch Health Companies Inc: “[CEO] Joe Papa, I think he’s doing a good job, but he brought the Bausch and Lomb [subsidiary] to the market at a very bad time. And that’s really, really crushed the stock.”

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    Pioneer Natural Resources Co: “You’ve got to wait for it to come in, because it’s going to come in a little more and then we’re going to buy some more.”

    Disclosure: Cramer’s Charitable Trust owns shares of Bausch and Pioneer Natural Resources.

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    Salesforce CEO Marc Benioff says foreign exchange pushed the company to lower revenue guidance

    Monday – Friday, 6:00 – 7:00 PM ET

    Salesforce co-founder and co-CEO Marc Benioff told CNBC’s Jim Cramer on Tuesday that the rising value of the dollar played a part in the software company lowering revenue guidance in its latest quarter.
    “Our guidance is really impacted by foreign exchange,” Benioff said in an interview on “Mad Money.”

    Salesforce co-founder and co-CEO Marc Benioff told CNBC’s Jim Cramer on Tuesday that the rising value of the dollar played a part in the software company lowering revenue guidance in its latest quarter.
    “Our guidance is really impacted by foreign exchange,” Benioff said in an interview on “Mad Money.” “We have now had to consume about $600 million of foreign exchange changes … since we first gave guidance last November.”

    “The [U.S] dollar gets stronger and stronger as an incredible safe haven. And while that’s great if all of your revenue’s in the United States, we do have strong businesses internationally – we’re the third-largest software company in Japan right now,” he said, adding that he’s “never seen anything like” the deceleration of the Japanese yen since March.
    The dollar index, which compares the U.S. currency’s performance against other major currencies including the euro and the yen, is up more than 6% this year and hit its highest level in about 20 years this month.
    While a strong dollar can boost the performance of companies that largely depend on business in the U.S., it’s bad news for those that rely on businesses in Europe and Asia and see smaller profits when foreign sales are translated into dollars. 
    “While we had a great quarter, the U.S. dollar, they had a far better quarter than we did. I’ve never seen the strength of the dollar like this,” Benioff said.
    Salesforce beat Wall Street expectations on first-quarter revenue and earnings reported after the bell on Tuesday. The company raised its profit outlook but lowered its revenue guidance. 

    Disclosure: Cramer’s Charitable Trust owns shares of Salesforce.
    Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.
    Disclaimer

    Questions for Cramer?Call Cramer: 1-800-743-CNBC
    Want to take a deep dive into Cramer’s world? Hit him up!Mad Money Twitter – Jim Cramer Twitter – Facebook – Instagram
    Questions, comments, suggestions for the “Mad Money” website? [email protected]

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    Jim Cramer says these three Big Tech stocks have ‘nowhere else to go but up’

    Monday – Friday, 6:00 – 7:00 PM ET

    CNBC’s Jim Cramer told investors on Tuesday that some stocks have fallen so far from their highs that they will inevitably rally.
    Calling them “colossal losers,” Cramer pinpointed three members of his now-discarded FAANG acronym as names that will rebound.

    CNBC’s Jim Cramer told investors on Tuesday that some stocks have fallen so far from their highs that they will inevitably rally.
    “While they may stay losers, the bottom line is they’ve fallen so darn far that I think they’ve become metaphors for a whole host of stocks that are now ready to rally because they’ve got nowhere else to go but up,” the “Mad Money” host said.

    Calling several tech giants “colossal losers,” Cramer pinpointed Amazon, Facebook-parent Meta Platforms and Google-parent Alphabet — three members of his now-discarded FAANG acronym — as names that will rebound. The other FAANG companies include Apple and Netflix.
    Here’s why Cramer believes those three ‘losers’ will rally:
    Amazon

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    Cramer said that he believes the company could boost its stock valuation if it culls warehouses and workers, takes a more aggressive approach to retail advertising and keeps its Amazon Web Services robust. 
    “Amazon is a company that could earn $82 a share in 2024. Now, before you laugh about me using 2024 estimates, remember that 2022 is almost half over,” he said.

    Meta Platforms

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    Cramer said that he has faith in Zuckerberg’s vision for the metaverse, noting that other leaders, including Nvidia Chief Executive Jensen Huang, are also betting big on it.
    Alphabet

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    Noting that Google is the “best way to advertise,” Cramer said that the company is insulated from getting dragged down when other tech companies such as Snap don’t perform well.
    Disclosure: Cramer’s Charitable Trust owns shares of Alphabet, Amazon, Apple, Meta and Nvidia.

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    Victoria's Secret reports better-than-expected profit but warns challenges could persist

    Victoria’s Secret reported a fiscal first-quarter profit that topped Wall Street expectations, but warned that the retail environment will continue to be challenging.
    The company noted sales in the year-ago period got a bump from the federal stimulus money people spent.
    For the most recent quarter, Victoria’s Secret reported strength in its bras and beauty businesses as its international segment recovered from heavy Covid restrictions.

    Shoppers are seen inside a shopping mall in Bethesda, Maryland on February 17, 2022.
    Mandel Ngan | AFP | Getty Images

    Victoria’s Secret reported a quarterly profit that topped Wall Street expectations on Tuesday, but warned that it could continue to face supply chain and sales challenges for the remainder of the year.
    The Ohio-based lingerie retailer noted that it faced “supply chain headwinds” in the three-month period ended April 30 while also lapping the sales bump it got in the year-ago period from people spending their federal stimulus money.

    “If the first quarter sales trends adjusted for stimulus were to continue for the balance of the year, it could challenge our ability to deliver full year operating income in line with last year,” the company said in a news release.
    Sales in the quarter were down 4.5% from a year ago, but in line with Wall Street estimates. The company noted that federal stimulus benefits lifted sales by about $75 million in the same period in 2021.
    For the most recent quarter, the company reported strength in its bras and beauty businesses as its international segment recovered from heavy Covid restrictions.
    The company’s shares rose around 7% in extended trading.
    Here’s how Victoria’s Secret did in its fiscal first quarter compared with what Wall Street was expecting, based on Refinitiv estimates:

    Earnings per share: $1.11 adjusted vs 84 cents expected
    Revenue: $1.48 billion vs. $1.48 billion expected

    For the three-month period ended April 30, net income was $76.14 million, or 93 cents per share, compared with net income of $174 million, or $1.97 per share, a year earlier.
    Excluding one-time items, Victoria’s Secret earned $1.11 per share, ahead of the 84 cents that analysts expected.
    Sales fell 4.5% to $1.48 billion from $1.55 billion a year earlier, but were in line with Wall Street forecasts.
    Same-store sales were down 8% in the quarter from 2021. Adjusting for last year’s stimulus benefit, the company said same-store sales were down 3%.
    Victoria’s Secret ended the quarter with inventory levels up 37% from the prior year, which it said was primarily due to longer transportation times and higher cost of goods stemming from inflation.
    For its fiscal second quarter, Victoria’s Secret expects to earn between 95 cents per share to $1.25 a share, on an adjusted basis. Analysts were looking for $1.19 per share.
    The company forecast sales to be down low-single digits to up low-single digits on a year-over-year basis. Analysts were looking for a 0.8% decline.
    For the year, Victoria’s Secret said Tuesday it still expects total sales to be flat to up low-single digits from 2021. Analysts were projecting a year-over-year increase of 1.7%, according to Refinitiv data.
    “We have proactively anticipated and are managing supply chain and inflationary pressures,” the company said in prepared remarks. “However, we understand there could be volatility in our results.”
    Victoria’s Secret shares have fallen about 26% year to date, as of Tuesday’s market close.

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    Dow drops 200 points, finishes month little changed in turbulent May

    U.S. stocks fell in see-saw trading Tuesday as investors closed out a rocky month that saw the S&P 500 flirt with bear-market territory amid inflation and recession fears.
    The Dow Jones Industrial Average fell 222.84 points, or 0.7%, to close at 32,990.12. The S&P 500 dipped 0.6% to 4,132.15. The Nasdaq Composite eased 0.4% to 12,081.39. The technology-heavy index was up 0.5% at its highs and down nearly 1.6% at its lows.

    After a holiday hiatus Monday, U.S. stocks wrapped up a roller-coaster May. The Dow and the S&P 500 finished the month little changed, supported by a major rally the week prior. The Nasdaq lost about 2.1% on the month.

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    “The market is digesting the sharp rally late last week and trying to figure out its footing,” Peter Boockvar, chief investment officer of Bleakley Advisory Group, said. “We’re still far from being out of the woods here in terms of the major overhangs, being inflation, monetary tightening and rising rates.”
    Tuesday’s market action underscored fears that high inflation is weighing on economic growth. In Europe, euro zone inflation readings released Tuesday hit a record high for a seventh straight month, surging 8.1% in May.
    Action in the oil market was also front-of-mind for investors. Oil prices initially jumped following the European Union agreeing to ban most crude imports from Russia. Then, oil prices eased from highs as The Wall Street Journal reported the Organization of the Petroleum Exporting Countries was weighing suspending Russia from its oil-production deal.

    Energy stocks comprised the worst-performing S&P 500 sector Tuesday, after being the biggest gainer earlier in the session. Chevron slid 2%, and Schlumberger fell 4.3%.

    Industrial stocks linked to the economic cycle also declined Tuesday. Honeywell lost 1.4%, and Nucor fell 3.8%.
    Health care was another lagging sector Tuesday. UnitedHealth Group was among the biggest losers on the Dow, off by 2%.
    Meanwhile, a rally in some mega-cap technology stocks provided a bit of support to the broader indexes. Amazon rose 4.4% and Google parent Alphabet gained 1.3%.

    A tumultuous month

    At the start of May, the Federal Reserve hiked interest rates by half a percentage point in a bid to tamp down generationally hot inflation. Recession fears have mounted as market participants fear the Fed’s policy tightening will trigger an economic decline.
    “Higher inflation and slower growth are now the consensus view but that doesn’t mean it’s fully discounted,” Morgan Stanley’s Mike Wilson said in a note Tuesday.
    Disappointing quarterly reports in May from the likes of Walmart and Snap showed inflation hurting American consumers and eating into corporate profits.
    Investors also eyed the continuing war in Ukraine and Covid outbreaks in China, raising concerns about global commodities and supply chain challenges.
    Stocks struggled during the month amid the negative cross currents. The S&P 500 on May 20 dipped into bear-market territory briefly, falling 20% below its high at one point during the session. Meanwhile, the Dow saw its longest weekly losing streak since 1923, falling for eight consecutive weeks before last week’s rally.
    Last week, the Dow and the S&P 500 notched their best weekly gains since November 2020. The blue-chip average closed up 6.2% for the week, ending an eight-week losing streak. The S&P 500 gained 6.5%, and the Nasdaq added 6.8% on the week, ending positive after seven continual weeks of losses.
    Still, stocks remain well off their highs. The Dow is 10.7% below its record. The S&P 500 is down 14.2%, and the Nasdaq is off by 25.5%.
    “Bear markets are incredibly difficult to navigate, because they are inherently volatile and prone to sharp upside rallies,” Wolfe Research’s Chris Senyek said in a note Tuesday.

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    Taco Bell locations are running out of Mexican Pizza less than two weeks after its return

    Taco Bell is running out of Mexican Pizza, less than two weeks after the chain brought back the menu item.
    The chain, owned by Yum Brands, said in a statement that it’s working with its restaurants and suppliers to get Mexican Pizza back on its menu permanently by the fall.
    Demand for Mexican Pizza was seven times higher than the last time it was on the menu.

    Taco Bell’s Mexican Pizza
    Source: Taco Bell

    Taco Bell is running out of its Mexican Pizza, less than two weeks after the chain brought back the menu item.
    The chain, owned by Yum Brands, said in a statement that it’s working with its restaurants and suppliers to get the item back on its menu permanently by the fall.

    “We are working as fast as we can to restock Mexican Pizza ingredients,” the chain said on Twitter.
    Taco Bell’s take on pizza includes seasoned beef and refried beans between two shells with a pizza sauce, melted cheese and tomatoes. Vegetarians can ask for it without the beef.
    Demand for the Mexican Pizza was seven times higher than the last time it was on the menu, in November 2020, according to Taco Bell. The chain had cut Mexican Pizzas, pico de gallo and shredded chicken from its offerings as part of a push to simplify operations and focus on more popular items.
    But after fans begged for Mexican Pizza to return, Taco Bell brought the item back, on May 19. One restaurant, in Roseville, California, sold more than 1,000 in one day, the company said.
    Taco Bell used its partnership with rapper Doja Cat to drum up excitement for the item’s comeback. The chain had also planned to release a TikTok musical, starring both Doja Cat and country music legend Dolly Parton. The release of the musical has also been delayed.
    Taco Bell isn’t the only fast-food chain to face shortages of a menu item thanks to social media buzz. Restaurant Brands International’s Popeyes sold out of its first nationwide chicken sandwich in August 2019, less than a month after its debut. A Twitter feud between Chick-fil-A and Popeyes inspired consumers to want to taste the new sandwich for themselves. But the wait only built more anticipation from customers. The chicken sandwich returned to stores in November, leading to hourslong lines at some locations.

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    Why oil is back above $120 per barrel

    In the 1970s Arab states used the “oil weapon” of embargoes to punish Western governments for supporting Israel. On May 30th the heads of the 27 eu member governments agreed to turn the weapon on themselves, as part of their latest round of sanctions against Russia following its invasion of Ukraine. As well as cutting off Sberbank, Russia’s largest bank, from the swift cross-border payment system, the package will also ban purchases of Russian crude oil and refined petroleum products, such as diesel, by the end of the year. There would, the eu said, be a “temporary” exemption for oil delivered through pipelines. The price of Brent crude oil surged above $120 per barrel on the news, its highest level since March.In principle, the decision is highly significant. As well as being a demonstration of unity, and the bloc’s willingness to bear economic pain to punish Russia, it cuts one of the few remaining trade ties with the Kremlin. It also imperils one of Russia’s most lucrative sources of foreign-currency earnings. The eu is Russia’s biggest market for crude, buying about half the country’s oil exports. There are reasons, however, to be sceptical that the move will deprive Kremlin of much foreign currency. For a start, the embargo applies only to seaborne oil, transported via tankers. That is the price of unity: excluding oil delivered by pipelines was necessary to find a compromise with Hungary, which is both more sympathetic to Russia than most eu countries and critically dependent on the Soviet-era Druzhba pipeline (a name meaning “friendship” in Russian). Hungary imports about 65% of its crude from Russia.Seaborne oil makes up a similar proportion of Europe’s imports from Russia. But the ban is likely to have a limited impact on the oil market. Many tankers are already subject to so-called self-sanctioning in parts of the West. Dockworkers have refused to unload ships carrying Russian cargoes and oil majors have been worried about the hit to their reputations from accepting shipments. Western financiers are stepping back from writing insurance contracts. Although maritime insurers based in Russia’s allies could partly replace them, they have far shallower pockets. A big question is whether Russian seaborne crude, once placed under sanctions, will go unsold. So far Russia’s oil exports have increased even as the country has come under sanctions. According to analysts at JPMorgan Chase, a bank, Russian crude exports have risen since the invasion of Ukraine. Much of it has gone to India, which has not issued sanctions of its own. Another question is whether Europe does eventually ban piped Russian oil, which is harder to redirect to other countries. Poland and Germany have said that they will cease imports via the Druzhba pipeline. Yet it is hard to imagine Hungary dropping its opposition to a wider ban. Viktor Orban, the country’s populist prime minister, has demonstrated his willingness to block eu decisions before. Thanks to a hefty discount on Russian crude—the Urals benchmark is trading significantly below Brent—mol, a Hungarian oil group, reports “skyrocketing” margins.Partial though the embargo may be, such is the tightness of the oil market that prices have still leapt. Demand for fuel is strong as the pandemic subsides and consumers start driving and flying again, and as governments take steps to shield voters from the impact of higher energy costs. China’s easing of coronavirus restrictions in recent days has also added to the thirst for oil. The prices of industrial metals, including iron ore and copper, have rallied, too. Meanwhile, the Organisation of the Petroleum Exporting Countries (opec) and its allies, which include Russia, have shown little sign of increasing production just yet. At a meeting on June 2nd the group is not expected to announce any changes to its plans to gradually increase supply to levels seen before the pandemic (although it is reported to be mulling a plan to exclude Russia from its production targets, allowing Saudi Arabia and others to pump more to make up for any cutbacks in Russia). Combine tight supply and increased demand, and the consequence for consumers at the pump is higher prices. To make matters worse, a shortage of refinery capacity in America has raised the prices for petrol and diesel even further than the cost of crude. Francisco Blanch of the Bank of America points out that the surging dollar adds to costs for Europe and emerging markets. None of this is welcome news in an already-inflationary environment. According to figures published on May 31st, for instance, inflation in the euro area rose to 8.1% in the year to May, higher than economists had expected.The Arab embargoes of the 1970s caused short-term pain for the West, but also spurred a drive for fuel efficiency that ultimately reduced its reliance on oil. European governments today may also find themselves hoping that the short-term pain for consumers is worth the long-term gain of energy security. ■ More