Business

Monday – Friday, 6:00 – 7:00 PM ET

Don’t start buying the dip in large-cap tech stocks just yet, CNBC’s Jim Cramer said Monday.
That’s the takeaway from Carolyn Boroden’s latest technical analysis on Alphabet and Amazon.

Investors who want to capitalize on the struggles of large-cap technology stocks should remain patient, CNBC’s Jim Cramer said Monday, citing technical analysis from Carolyn Boroden.
“The big tech stocks have been hammered from their highs, but the charts, as interpreted by Carolyn Boroden, suggest it probably isn’t safe to start bottom fishing, even if those charts begin to improve a bit,” the “Mad Money” host said. “Amazon and Alphabet simply aren’t in buy-the-dips situations.”

To illustrate the point, Cramer presented a chart from Boroden — a technical analyst whose work is often discussed on the program — that shows Alphabet shares below their 200-day and 50-day moving averages.

Arrows pointing outwards

Carolyn Boroden’s latest technical analysis on shares of Alphabet.
Mad Money with Jim Cramer

“It’s got a general pattern of lower lows and lower highs,” Cramer said, which is a “very, very negative” sign for technical analysts. “The five-day exponential moving average is below the 13-day,” he added, noting that is Boroden’s “personal sell signal.”
In general, Cramer said Boroden believes Alphabet — along with other tech giants with downtrodden stocks this year — will not be able to return overnight to bullish trading patterns that defined 2020 and much of last year, too.
“Of course, she thinks it’s possible we could get some oversold rallies here,” Cramer said. However, he added, “the stock has a lot of resistance on the way up, though. You’ve got a bunch of ceilings running from $88 to $93. … Given the lack of anything bullish in this chart, Boroden wouldn’t bet on Alphabet breaking through this ceiling.”
For more analysis, watch Cramer’s full explanation below.

Jim Cramer’s Guide to Investing

Click here to download Jim Cramer’s Guide to Investing at no cost to help you build long-term wealth and invest smarter.

WATCH LIVEWATCH IN THE APP More

State of Freight

The German Port of Bremerhaven, Europe’s fourth largest and an auto hub, is seeing so much congestion due to driver shortages and overall trade volume that cars are piling up on land and at sea.
Tesla, Chrysler and Jeep parent company Stellantis, Renault, BMW and Volvo are all impacted.
Leading vehicle carrier Wallenius Wilhelmsen has refused auto exports for October and November, and possibly into December.

Krisztian Bocsi | Bloomberg | Getty Images

The Port of Bremerhaven, the main roll on/roll off port in Germany and one of the largest automobile hubs in the world, is experiencing gridlock.
The combination of the lack of drivers to move containers and cars out of the port and high volumes of regular trade is creating a pileup of vehicles on land and at sea from automakers including Tesla, Stellantis, BMW, Renault and Volvo.

Logistics managers consulted by CNBC described the auto export delays as significant.
“These delays are massive,” said Andreas Braun, regional director of ocean product, EMEA, for Crane Worldwide Logistics. He said car imports into Bremerhaven from the U.S. and Mexico are operating on a timeline of months. “There is a three-month delay for BMW, where cars sit in yards waiting to be fitted with extras, especially with the iDrive touch controller.”
Bremerhaven is Europe’s fourth-largest containership port, with annual capacity over 5 million TEU [twenty-foot equivalent unit] containers. It moves over 1.7 million vehicles a year. Its overall congestion level, ex-autos, is currently “moderate,” according to the CNBC Supply Chain Heat Map for Europe.

Arrows pointing outwards

Trade intelligence firm VesselsValue tells CNBC that operators have been told by the Port of Bremerhaven there is a severe shortage of H&H (high and heavy cargo) drivers and roll on/roll off drivers to move the incoming automobiles. Military exercises have absorbed a fair amount of terminal space usually reserved for operators.
There are also currently not enough ocean vehicle carriers, a situation which has led shipping line Wallenius Wilhelmsen to refuse export bookings to the U.S. for the months of October and November, and possibly December if waiting hours pick up again, said Dan Nash, head of vehicle carriers and roll on/roll off carriers) at VesselsValue.

Its data shows the refusal of auto exports has helped reduce the processing time at the port which has spiked in recent months, and is now trending up again.
Nash told CNBC that highlighting challenges for automakers are imports of Tesla from its Shanghai Gigafactory and light-duty vehicles mostly brought in from Japan, South Korea and China.

In addition to the labor constraints at the key port, stretched vessel capacity is adding to the delays.
The global fleet is short approximately 13 vessels compared to December 2019, according to VesselsValue data. “This is a result of excess scrapping of vessels in the first year of Covid-19. This wait time is expected to last until 2024 when the newly built vessels start to be delivered,” Nash said.
While prices have come down across the global supply chain from Covid peaks, “this is likely to keep rates high because vessels are trading at full capacity,” he said. Growing demand for electric vehicles from China will place greater strain on the supply-demand in the future, he added.

Another UK strike nears

At the Port of Liverpool in the U.K., a fourth strike is set for November 14-21 if no deal with port management is reached. Braun told CNBC that since these strikes are well organized there is time in advance to plan and circumvent the port, diverting trade elsewhere. Truckers and other workers who depend on the port operating as normal will be hit harder, he said.

Read more about electric vehicles from CNBC Pro

“If there are no containers coming in and going out, there is no business for them and they have to pull out of container trucking and truck something else,” Braun said. “Eventually, less volume also means that Peel Ports might have good arguments to lay off workers.”
Peel Ports is the owner of the Liverpool port, among others in the U.K.
Braun says Crane Worldwide Logistics is also prepping clients for additional strikes being discussed at Felixstowe, the U.K.’s largest container port, which has had a series of strikes, and a possible strike at London Heathrow. 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…

Ring Energy: “This is a small cap. It’s not a dice roll because it’s a legitimate company. I do prefer something that gives you that dividend because you know in the Investing Club, we bought Coterra. See, that is the better one. It’s got a good yield, 50% oil, 50% natural gas. … Coterra is the one to buy.”

Loading chart…

Lantheus Holdings: “I was going to hit you with Danaher. That’s an Investing Club name. But I think that Lantheus is a really good idea.”

Loading chart…

Kyndryl Holdings: “It’s an IBM reseller. I know that [CEO] Martin Schroeter would say it’s a lot more than that, but I’ve got to be conscious of the fact that the stock has not been that good. However, the stock does seem to be bottoming, and I think that Martin is shrewd enough to be able to take out some costs and get this thing rolling. So, $9 stock. It was up big today. It was up almost 10%. If it comes down a little, maybe you [take a little position].”

Loading chart…

Antero Resources: “Antero is very, very cheap. I am saying … that Coterra has got that combination of dividend and growth that I like. It was misinterpreted on Friday when they reported. But Antero is very inexpensive, and I’m not going to say anything bad about it.”

Loading chart…

Tesla: “Tesla has got the worst chart I’ve ever seen, and that’s what’s driving things. I am still a believer. People are very worried that [CEO Elon Musk] has to sell a lot of Tesla in order to be able to pay whatever he has to pay for Twitter. I say that Tesla is not cheap, but I’m not going to let the chart determine the fact that I think it’s a decent situation.”

Jim Cramer’s Guide to Investing

Click here to download Jim Cramer’s Guide to Investing at no cost to help you build long-term wealth and invest smarter.

WATCH LIVEWATCH IN THE APP More

Homeowner equity peaked at $11.7 trillion collectively last May, after home prices jumped 45% since the start of the pandemic.
In September, home prices fell on a month-to-month basis for the third month in a row.
Since July, the median home price has dropped by $11,560.

A home awaits sale at a reduced asking price in Glendale, California.
David McNew | Getty Images

The historic run-up in home prices during the first two years of the pandemic gave homeowners record amounts of new home equity.
Since May, however, about $1.5 trillion of that has vanished, according to Black Knight, a mortgage software and analytics company. The average borrower has lost $30,000 in equity.

Homeowner equity peaked at $17.6 trillion collectively last May, after home prices jumped 45% since the start of the pandemic.
At the end of September, prices were still up 41%, and equity was still quite strong. Borrowers who bought their homes before the pandemic collectively have $5 trillion more than they did before the pandemic hit. That translates to a gain of $92,000 more equity per borrower than in February of 2020.
“While additional declines may be on the horizon, homeowner positions remain broadly strong,” noted Ben Graboske, Black Knight’s president of data and analytics.
But home prices began to weaken as mortgage rates rose in the spring, making it a lot less affordable to buy. The monthly payment on the average home, with a 20% down payment on a mortgage, is up nearly $1,000 since the start of the year.

In 10% of major markets — including Las Vegas, Miami, Los Angeles, Phoenix, Tampa and San Diego — homeowners have to spend twice the long-term average amount of median household income to make their monthly payments.

That’s why home sales began dropping sharply back in May — and why prices have been following suit.
Home prices fell in September on a month-to-month basis for the third month in a row, though the decline wasn’t as steep as in July and August. While prices usually drop from summer to fall due to the seasonal slowdown, they fell much more sharply than usual in 2022.
Prices are now down 2.6% since the end of June, which is the first three-month drop since late 2018 and the steepest such drop since the financial crisis of early 2009. Since July, the median home price is down by $11,560. Prices, however, are still 10.7% higher than they were in September 2021.
As of the end of September, the amount of collective equity available to borrowers while still keeping 20% equity in the home fell by $1.17 trillion since May. That’s the first decline in so-called tappable equity in three years.
The share of borrowers who owe more on their mortgages than their homes are worth is still quite low, at just 0.85%. But the numbers are beginning to rise.
Less than 500,000 borrowers are currently underwater on their mortgages, but that is still double what it was in May. Those who purchased their homes in the past year will be most at risk of going underwater since they bought at the peak of the market.
“This is obviously a situation that demands careful, ongoing monitoring, but to put that into context, just 3.6% of nearly 53 million U.S. mortgage holders are either underwater or have less than 10% equity in their homes roughly half the share coming into the pandemic” Graboske said.

WATCH LIVEWATCH IN THE APP More

In October, just 16% of consumers said they thought now is a good time to buy a home, according to a monthly survey by Fannie Mae.
A higher share of consumers, 37%, said they expect home prices to drop in the next 12 months, according to a Fannie Mae survey.

An ‘Open House’ sign is displayed as potential home buyers arrive at a property for sale in Columbus, Ohio.
Ty Wright | Bloomberg | Getty Images

Rising mortgage rates, high home prices and uncertainty in the overall economy have Americans feeling more pessimistic about the state of the housing market.
In October, just 16% of consumers said they thought now is a good time to buy a home, according to a monthly survey by Fannie Mae. That is the lowest share since the survey began in 2011. The share of respondents who thought now is a good time to sell a home also dropped from 59% to 51%.

Fannie Mae’s survey looks not just at buying and selling but tests sentiment about home prices, mortgage rates and the job market. It combines them all into one number, which also fell for the eighth straight month and now sits at a new low.
A higher share of consumers, 37%, said they expect home prices to drop in the next 12 months. That compares with 35% in September. More also believe mortgage rates will rise.

Fast-rising interest rates are what turned the red-hot housing market on its heels in early summer. The average rate on the popular 30-year fixed mortgage started the year near a record low, around 3%. By June it crossed 6%, and it’s now just over 7%, according to Mortgage News Daily.
“As continued affordability constraints reduce homebuyer demand, and homeowners become reluctant to sell at potentially reduced prices, we expect home sales to slow even further in the coming months, consistent with our forecast,” wrote Doug Duncan, Fannie Mae’s chief economist, in a release.
Home prices dropped again in September, according to Black Knight, albeit at a slower monthly pace than they did in July and August. Prices are now down 2.6% since June, the first three-month decline since 2018, when interest rates also rose. It is the worst three-month stretch for home prices since early 2009. Prices, however, were still 10.7% higher in September than the same month last year.

WATCH LIVEWATCH IN THE APP More

Monday – Friday, 6:00 – 7:00 PM ET

A strong showing from Republicans in the midterm elections could spark a rally in energy stocks, CNBC’s Jim Cramer said Monday.
Cramer said oilfield services firms like Halliburton and SLB, formerly known as Schlumberger, should be among the industry’s best performers in that scenario.

CNBC’s Jim Cramer said he anticipates a near-term rally in energy stocks if Republican candidates perform well in Tuesday’s midterm elections and win a majority in at least one chamber of Congress.
Oil and gas companies should be among the “biggest winners” if that were to happen, Cramer said Monday night. He said shares of oilfield services firms — such as Halliburton and SLB, formerly known as Schlumberger — should be standouts in that scenario. Cramer’s Charitable Trust owns shares of Halliburton.

“Next up would be the oil and gas producers … that need more pipelines to bring their product to market,” Cramer added.
Outside of the energy sector, Cramer said Wall Street would likely interpret a strong Republican showing Tuesday as favorable for financials.
“The Biden administration is considered incredibly anti-bank, so you might want to buy the majors: JPMorgan, Bank of America, or Wells Fargo, the latter being a big position in the charitable trust,” he said.
To be sure, Cramer cautioned that the market’s reaction Wednesday to the election results depends on what happens in Tuesday’s trading session. On Monday, all three major U.S. stock indexes finished solidly higher — a move Cramer suggested was “a kneejerk presumption that a Republican victory [Tuesday night] will definitely lead to higher stock prices.”
“If the market keeps running [Tuesday] in anticipation of a Republican sweep, you need to be aware that we’ve already had a big move,” he said, “and that may be all we’re entitled to for now.”

Cramer said unless interest rates move lower or outlooks for corporate earnings improve, “there’s a lot that stays the same even when Congress changes hands.”

Jim Cramer’s Guide to Investing

Click here to download Jim Cramer’s Guide to Investing at no cost to help you build long-term wealth and invest smarter.

WATCH LIVEWATCH IN THE APP More

Shares of Carvana plummeted for a second-consecutive trading day.
The stock hit its lowest point on record, below $7 per share.
Volume spiked on the beaten-down used car seller name.

A Carvana used car “vending machine” on May 11, 2022 in Miami, Florida.
Joe Raedle | Getty Images

Shares of Carvana plummeted for a second-consecutive trading day as investors unloaded shares of the embattled used-vehicle seller amid growing challenges for the company and a softening for the industry.
The stock ended the trading day off 15.6% at $7.39 per share after brief trading halts earlier in the day and being down as much as 23.7% at one point to $6.68 per share — its lowest point on record.

Volume spiked on the beaten-down used car seller, with more than 52 million shares changing hands, including more than 9.2 million during the first 22 minutes of trading. That compares with the stock’s 30-day average volume of 14.14 million.

Monday’s trading volume was the second-highest on record for the stock, behind only the 71 million shares that traded hands on Friday.
Shares of Carvana have plummeted by about 97% this year after reaching an all-time intraday high of $376.83 per share on Aug. 10, 2021. They’re down 48.5% since Thursday’s close, shortly before Carvana missed Wall Street’s top- and bottom-line expectations for the third quarter as the outlook for used cars falls from record demand, pricing and profits during the coronavirus pandemic.

Loading chart…

Cox Automotive’s Manheim Used Vehicle Value Index, which tracks prices of used vehicles sold at its U.S. wholesale auctions, has fallen by 15.4% this year through October after peaking in January, including a 2.2% decline from September to October.
Retail prices traditionally follow changes in wholesale. That’s good news for potential car buyers, however not great for companies such as Carvana that purchased the vehicles at record highs and are now trying to sell them at a profit.

Monday’s decline comes after Carvana stock posted a roughly 39% decline Friday, marking its worst day ever.

Morgan Stanley on Friday pulled its rating and price target for the stock. Analyst Adam Jonas cited deterioration in the used car market and a volatile funding environment for the change.
Pricing and profits of used vehicles have been significantly elevated as consumers who couldn’t find or afford to purchase a new vehicle opted for a pre-owned car or truck. Inventories of new vehicles have been significantly depleted during the pandemic largely due to supply chain problems, including an ongoing global shortage of semiconductor chips.
But rising interest rates, inflation and recessionary fears have led to less willingness by consumers to pay the record prices, leading to declines for Carvana and other used vehicle companies such as CarMax.
Carvana co-founder and CEO Ernie Garcia on the company’s quarterly call Thursday described the next year as “a difficult one” for Carvana, citing a normalization of the used vehicle industry from its inflated levels and increasing interest rates, among other factors.
He described the end of the third quarter as the “most unaffordable point ever” for customers who finance a vehicle purchase.
—CNBC’s Fred Imbert contributed to this report.

WATCH LIVEWATCH IN THE APP More

Virgin Orbit announced that Richard Branson’s Virgin Group, an existing shareholder, made a $25 million investment on Nov. 4
The company, which uses a modified 747 jet to launch satellites with its rockets, brought in revenue of $30.9 million during the third quarter and had $71.2 million in cash on hand at the end of the period.
Virgin Orbit also lowered its forecast for launches in 2022: It now expects to achieve three launches, down from a forecast of between four and six that the company gave earlier this year.

Virgin Orbit’s modified 747 jet “Cosmic Girl” releases the company’s LauncherOne rocket for a mission on January 13, 2022.
Virgin Orbit

Virgin Orbit raised $25 million, the company announced Monday alongside its third-quarter results, as the alternative rocket launcher faces a dwindling cash reserve.
The company disclosed that Richard Branson’s Virgin Group, an existing shareholder, made the additional $25 million investment on Nov. 4. Virgin Orbit emphasized in its report that it will “continue to be opportunistic in the capital markets,” as the company is “focusing on cost and operational efficiency to improve cash flow.”

Virgin Orbit, which uses a modified 747 jet to launch satellites with its rockets, reported an adjusted EBITDA loss of $42.9 million for the third quarter – a 31% larger loss than the same period a year ago.
The company brought in revenue of $30.9 million and had $71.2 million in cash on hand at the end of the third quarter.
Its stock is down 64% this year as of Monday’s close of $2.92 a share.

Sign up here to receive weekly editions of CNBC’s Investing in Space newsletter.

Virgin Orbit also lowered its forecast for launches in 2022: It now expects to achieve three launches – including an upcoming launch from the U.K. – down from a forecast of between four and six that the company gave earlier this year. Virgin Orbit said the fourth launch is currently “paced by spacecraft readiness.”
The company’s backlog of binding contracts also fell from the previous quarter, down 12% to $143 million.
Virgin Orbit aims to “more than double” its 2022 launch rate next year, as well as expand its backlog of launches and spaceport agreements, with the company earlier in the third quarter announcing a multi-year launch deal with satellite company Spire.

WATCH LIVEWATCH IN THE APP More