Raphael Stevens

Monday – Friday, 6:00 – 7:00 PM ET

CNBC’s Jim Cramer said Wednesday he believes it’s possible for investors to build a successful portfolio despite Wall Street’s tough start to 2022.
“Real companies doing real things with tremendous brand loyalty are what will triumph in this environment—you just need to know where to look,” the “Mad Money” host said.

CNBC’s Jim Cramer said Wednesday he believes it’s possible for investors to build a successful portfolio despite Wall Street’s tough start to 2022.
“Real companies doing real things with tremendous brand loyalty are what will triumph in this environment— you just need to know where to look,” the “Mad Money” host said, after the tech-heavy Nasdaq Composite closed Wednesday’s session in correction territory, meaning it’s down more than 10% from its most recent high, which was recorded in November.

The S&P 500 fell nearly 1% Wednesday, putting its year-to-date decline at 4.9%. The blue-chip Dow Jones Industrial Average also slid almost 1%, bringing its losses to 3.6% so far in 2022.
While Cramer said there are real headwinds such as inflation worries that are weighing on the stock market, investors need to look past the big picture and focus on the characteristics of successful companies.
“It’s not the broken supply chain, it’s who can triumph over the broken supply chain,” Cramer said. “It’s not the jump in raw costs, it’s who has the brands that allow them to pass those costs onto the customers. It’s not the inevitable rate hikes from the Fed, it’s who can thrive in a higher interest rate environment.”
For example, Cramer pointed to Procter & Gamble as one example. The consumer products giant saw its stock rise 3.36% Wednesday after it reported better-than-expected second-quarter results.
“Even though it had $2.8 billion in commodity, freight and currency headwinds, it could pass those costs onto you, the customer, without batting an eyelash, because not all brands are created equal. Procter’s are created better,” he said.

Bank of America, which beat quarterly profit estimates Wednesday morning, is another example of the kind of company investors should consider owning in this current environment, Cramer said. “This is an institution that thrives off rate hikes. So, when we see the numbers it reported today, I think it deserved to rally a lot more than it did, frankly, because 2022 could be the year of Bank of America.”
Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.

WATCH LIVEWATCH IN THE APP More

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.

Loading chart…

DuPont de Nemours: “Sold it for the [charitable trust] yesterday. Why? Because it had moved up. We wanted to be able to take a good gain.”

Loading chart…

Commercial Vehicle Group: “I like stocks that are inexpensive and have to do with autos, and there you’ve got one. I think you’re in good shape.”

Loading chart…

Loading chart…

Loading chart…

FREYR Battery: “No, no, no, no. no. We’re not doing battery stocks whether it be [QuantumScape], whether it’s FREYR. We don’t like EV. EV is not working.”

Loading chart…

Vector Group: “That gives you cigarettes [exposure through Vector Group’s discount tobacco brand Liggett Group], and I don’t recommend cigarettes.”
Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.

WATCH LIVEWATCH IN THE APP More

Monday – Friday, 6:00 – 7:00 PM ET

SEC Chair Gary Gensler on Wednesday issued a warning to retail investors who use commission-free brokerage applications to buy and sell stocks.
“I would say to you all, the public, as you’re investing: Beware that they’re trying to get you to trade more often. That’s their motivation,” he told CNBC’s Jim Cramer.
“Statistics usually show that investing is good, but trading often is not,” Gensler added.

Securities and Exchange Commission Chair Gary Gensler on Wednesday issued a warning to retail investors who use commission-free brokerage apps to buy and sell stocks.
In an interview with CNBC’s Jim Cramer, the head of the top U.S. securities regulator expressed concerns about what he sees as misaligned incentives between some investors and the services they use to participate in equity markets.

“I would say to you all, the public, as you’re investing: Beware that they’re trying to get you to trade more often. That’s their motivation,” Gensler said in an interview on “Mad Money.” “Statistics usually show that investing is good, but trading often is not.”
Gensler’s comments came in response to a question about the Reddit-fueled meme stock frenzy that began in January 2021 and the spotlight it put on the so-called gamification of investing.
Gensler said that even though it’s no secret Americans are “bombarded every day by … behavioral prompts” while using technology, the implications become worrisome when it extends into finance.
“The brokerage apps, the robo advisors, are doing it as well, and I think that we have to be aware that their motivation is to make more revenues for that startup or more money for that application and that business,” Gensler said. “We have a basic idea in America that they should be making advice and recommendations to us for our benefit.”
The SEC has been looking into gamification and behavioral prompts to see what steps, if any, the regulator can take to deliver greater protection for investors, Gensler noted. At the same time, Gensler acknowledged that there’s recently been an increase in the number of people who are interested in investing.

“It’s good to have more of the public of every generation thinking about their future and investing in this great thing of American capital markets and the companies that stand behind it,” he said. “But the constant daily prompts and motivations to trade more generally lowers returns.”
Sign up now for the CNBC Investing Club to follow Jim Cramer’s every move in the market.

WATCH LIVEWATCH IN THE APP More

Procter & Gamble is raising prices across more of its portfolio as commodity and freight costs climb higher.
For the second consecutive quarter, P&G increased its inflation forecast.
While the company appears confident in its pricing strategy, CEO Jon Moeller warned that there will be bumps in the road ahead.

Procter and Gamble Co. Pampers brand baby diapers are arranged for a photograph taken in Hastings on Hudson, New York, U.S., on Saturday, Oct. 17, 2020.
Tiffany Hagler-Geard | Bloomberg | Getty Images

Procter & Gamble is raising prices across more of its portfolio to protect its profit margins as commodity and freight costs climb higher.
The consumer giant said on its earnings call Wednesday that it has already told retailers about price hikes on fabric care products, like Tide detergent and Downy dryer sheets, slated to take effect Feb. 28. On Tuesday, the company told retailers that some personal health care products will see higher prices in mid-April.

P&G has already raised prices on 10 product categories across its portfolio: baby care, feminine care, adult incontinence, family care, home care, hair care, grooming, oral care and skincare. And it isn’t just U.S. consumers paying more. The company is also hiking prices in some of its international markets.
“The degree and timing of these moves are very specific to the category, brand, and sometimes the product form within a brand. This is not a one-size-fits-all approach,” CFO Andre Schulten said on the earnings call.

The Tide owner is hardly the only company to face rising costs as inflation accelerates at a record pace. The producer price index was up 9.7% on a 12-month basis to end 2021, the highest calendar-year increase ever in data going back to 2010, and the consumer price index climbed 7% in the same time, the highest level since 1982.
For the second consecutive quarter, P&G increased its inflation forecast. The company expects to pay $2.3 billion after tax in commodity costs and $300 million after tax for higher freight costs, up from last quarter’s outlook of $2.1 billion on commodities and $200 million on freight.
About half of the company’s 6% organic sales growth in its fiscal second quarter came from price increases. Executives pointed out that the majority of the pricing changes that the company has announced hasn’t even taken effect yet.

Higher prices can sometimes push consumers to trade down to cheaper alternatives from competitors or private label brands. But P&G appears confident in its pricing strategy. Executives told analysts on the conference call that its rivals are facing the same commodity cost pressure, unlike foreign currency headwinds that deal a greater hit to P&G because of its larger global presence.
“Pricing has been a positive contributor to our top line for 17 out of the last 18 years, 42 out of the last 45 quarters. When you have a business model that’s founded on innovation that provides higher levels of delight, solves problems better upon the consumers, you are able to charge a little bit more,” CEO Jon Moeller said Wednesday on CNBC’s “Squawk Box.”
And while P&G is still waiting for most of its announced price hikes to occur, those that have already taken effect haven’t hurt business or dented its market share.
“While it’s very early for these commodity-based price increases, to date, we see positive signs,” Moeller said on “Squawk Box.” “Probably 20% to 30% less price elasticity than we were expecting, and if you look at, for example, private-label market shares — private label being the lowest price offered on the market — they’re down.”
In other words, consumers are willing to pay more for the brands that they know instead of just choosing the cheaper option for toilet paper or laundry detergent.
However, Moeller also warned analysts that there will be potential setbacks related to pricing.
“There will be bumps in the road,” he said. “There will be cases where we take pricing, and we either encounter the consumer reaction that some of you are rightly looking to or a competitive reaction.”
Shares of P&G were up 3.8% in morning trading after the company reported its fiscal second-quarter results. Its quarterly earnings and revenue topped Wall Street’s estimates, and the company raised its sales outlook for fiscal 2022.

WATCH LIVEWATCH IN THE APP More

White House chief medical advisor Dr. Antrhony Fauci said younger children will likely need three doses.
Two shots did not induce an adequate immune response in children 2- to 4-years-old in Pfizer’s clinical trials.
Pfizer plans to submit data to the Food and Drug Administration in the first half of 2022 if the three-dose study proves successful.

Dr. Anthony Fauci speaks about the Omicron coronavirus variant during a press briefing at the White House in Washington, December 1, 2021.
Kevin Lamarque | Reuters

White House chief medical advisor Dr. Anthony Fauci on Wednesday said the Food and Drug Administration could approve Pfizer and BioNTech’s vaccine for children under 5-years-old in the next month.
“My hope is that it’s going to be within the next month or so and not much later than that, but I can’t guarantee that,” Fauci said during an interview with Blue Star Families, a nonprofit group that supports military families.

Fauci said younger children will likely need three doses, because two shots did not induce an adequate immune response in 2- to 4-year-olds in Pfizer’s clinical trials.
Pfizer plans to submit data to the Food and Drug Administration in the first half of 2022 if the three-dose study proves successful, the company announced in December. Pfizer said it did not identify any safety concerns with the 3-microgram vaccine doses in children six months to 4-years-old. Adults receive two doses of 30 micrograms apiece as part of their primary series of shots.

Children under 5 are particularly vulnerable right now because they are the only age group that is not currently eligible for vaccination. Hospitalizations of children with Covid are rising as the highly contagious omicron variant has rapidly spread through communities across the U.S. over the past month.

CNBC Health & Science

“Sadly, we are seeing the rates of hospitalizations increasing for children zero to four, children who are not yet currently eligible for Covid-19 vaccination,” Dr. Rochelle Walensky, director of the Centers for Disease Control and Prevention, told reporters during a conference call earlier this month.
Nearly 8 out of every 100,000 children under 5-years-old were hospitalized with Covid as of Jan. 8, more than double the rate in early December before the omicron became the dominant variant in the U.S., according to CDC data collected from 250 hospitals across 14 states.

Walensky said earlier this month there’s no indication that the omicron variant causes more severe illness in children. She said the delta variant also led to an increase in hospitalizations among children, but research later indicated that the variant did not make kids more sick compared with past variants. Real-world data from the U.S., U.K. and South Africa has indicated that omicron appears to cause less severe illness in adults.
Walensky said the unprecedented levels of virus transmission in the broader community is likely behind the increase in hospitalizations of children.

WATCH LIVEWATCH IN THE APP More

United posted a narrower fourth-quarter loss and higher revenue than expected thanks to strong year-end bookings.
The airline warned that the omicron variant has dented bookings and will delay its recovery from the pandemic.
United executives will hold a call with analysts and media at 10:30 a.m. on Thursday.

An aircraft takes off from O’Hare International Airport on January 18, 2022 in Chicago, Illinois.
Scott Olson | Getty Images

United Airlines said the surge in Covid-19 infections has hurt bookings in recent weeks and will further delay its recovery from the pandemic.
The Chicago-based airline said it expects first-quarter revenue to be 20% to 25% below the same period in 2019 when it generated $9.59 billion.

United lowered its 2022 growth forecast, saying it would fly less this year than it did three years ago, scrapping its plan to increase capacity by 5% from pre-pandemic levels. Costs for the first quarter would be up by as much as 15%, excluding fuel, and capacity down by 16% to 18% from three years earlier.
United’s shares were off more than 2% in after-hours trading.
The airline said that bookings for spring and summer are strong, however.
“The United team has been fighting through unprecedented obstacles to, once again, overcome the new and daunting challenges that COVID-19 is bringing to aviation, and I am grateful to each one of them for their commitment to taking care of our customers,” United Airlines CEO Scott Kirby said in an earnings release. “Omicron is impacting near term demand, we remain optimistic about the spring and excited about the summer and beyond.”
Delta Air Lines last week also said the omicron variant dented early 2022 bookings early this year and that it would drive it to a first-quarter loss, but that it expected to be profitable by March, forecasting a rebound in travel demand.

American Airlines reports before the market opens on Thursday.
United posted a net loss of $646 million, compared with a $641 million profit in the fourth quarter of 2019 but a smaller loss than the $1.9 billion it lost in the same quarter of 2020.
Revenue in the last three months of the year came in at $8.19 billion, off nearly 25% from 2019 but it was its strongest quarter of the pandemic thanks to robust holiday bookings. It was ahead of analysts’ estimates of $7.97 billion.
Adjusting for one-time items, United had a loss per share of $1.60, better than the $2.11 analysts estimated.
Here’s how United performed in the fourth quarter compared with what Wall Street expected, based on average estimates compiled by Refinitiv:

Adjusted results per share: a loss of $1.60 versus an expected loss of $2.11

Total revenue: $8.19 billion versus expected $7.97 billion.

United executives will hold a call with analysts and media on Thursday at 10:30 a.m. ET.

WATCH LIVEWATCH IN THE APP More

Starbucks has suspended its plan to require baristas to get vaccinated or receive weekly testing in the wake of the Supreme Court ruling that struck down the Biden administration’s Covid-protection mandate.
Starbucks also banned employees from wearing cloth masks, requiring the use of medical-grade masks instead.
More than 90% of workers have disclosed their vaccination status and the “vast majority” have been fully vaccinated, the company said.

People wear protective face masks outside Starbucks in Union Square in New York.
Noam Galai | Getty Images

Starbucks has suspended its plan to require baristas to get vaccinated or receive weekly testing.
The decision comes after the Supreme Court’s ruling last week that the Biden administration overstepped by mandating that large private employers had to require weekly testing for workers who weren’t fully vaccinated.

“While the [Emergency Temporary Standard] is now paused, I want to emphasize that we continue to believe strongly in the spirit and intent of the mandate,” wrote John Culver, chief operating officer and North American group president at Starbucks, in a letter Tuesday to baristas that was viewed by CNBC.
The company said it will still strongly encourage baristas to get inoculated and encourage disclosing their vaccination status.
Culver said in the letter that more than 90% of workers have disclosed their vaccination status and the “vast majority” have been fully vaccinated. As of Sept. 27, 2020, the company employed 228,000 workers in the U.S.
Last week, General Electric said it had suspended its vaccine-or-testing mandate for its workforce.
In light of new guidance from the Centers for Disease Control and Prevention on the efficacy of certain face masks, Starbucks told employees on Wednesday it would no longer allow baristas to wear cloth masks in the workplace.

Instead, they are required to wear at least one three-ply, medical-grade mask, the company said. N95, KN95 or KF94 masks are also allowed, but the coffee giant said it wouldn’t be able to provide them to workers because of supply constraints.
And starting Thursday, Starbucks said it will temporarily expand its self-isolation policy to help flatten the curve on Covid infection.
Baristas who are exposed at work, have ongoing close contact with someone who tests positive, have symptoms or have tested positive are instructed to self-isolate, regardless of vaccination status. Those workers will be eligible for Starbucks’ self-isolation pay for missed shifts, the coffee chain said.

WATCH LIVEWATCH IN THE APP More