Cramer Warns of Volatility Ahead of Tech Earnings, Elections
CNBC's Jim Cramer says Wall Street may face more turbulence as tech earnings, the midterm elections and the jobs report approach.
At a glance
- The Nasdaq, S&P 500 and Dow all finished the week lower after early gains.
- Cramer expects Apple, AMD, Palantir and several other companies to report earnings soon.
- He says midterm elections and the jobs report could add to market uncertainty.
Jim Cramer of CNBC's "Mad Money" warned investors on Friday that Wall Street volatility is likely to continue, pointing to technology earnings, the midterm elections and the monthly jobs report as major upcoming events. Stocks swung sharply during the week, with the Nasdaq Composite ending down 2 percent, the S&P 500 down 0.6 percent and the Dow Jones Industrial Average down 0.9 percent after early-week gains.
What we know
Cramer said investors should not assume the worst is over for technology shares. 'Don't try to call the bottom in the Nasdaq just yet,' he said, advising investors to buy high-quality companies being sold off while warning that strong earnings may not lift a stock if valuations are stretched.
Apple is scheduled to report after the bell. Cramer remains bullish but noted its valuation near 40 times earnings leaves little margin for error. Palantir is also expected to report encouraging results based on customer feedback about its AI software.
Advanced Micro Devices will report, providing a test for semiconductors after Intel's weak results. Cramer expects AMD to outperform Intel. Pfizer, Amgen, CVS Health, McDonald's and Kimberly-Clark are also on the earnings calendar. Cramer sees potential in drugmakers and consumer staples, though he questioned CVS's pharmacy benefit management business and wants to see if McDonald's restaurant improvements are working. He is optimistic about Kimberly-Clark following its planned merger with Kenvue.
The midterm elections could affect data center construction if political opposition grows, though Cramer said some states will welcome the projects. The jobs report is expected to show strong hiring with limited wage growth, which could ease inflation pressure and support Treasury yields. The CNBC Investing Club will hold its annual meeting, where Cramer and Jeff Marks will discuss the portfolio and market risks.
What is not known yet
It is unclear whether the recent sell-off in technology stocks will deepen or stabilize. The outcome of the midterm elections and its effect on data center spending is not yet known. Actual earnings results for Apple, AMD and the other companies have not been released.
What happens next
Apple, Palantir, AMD, Pfizer, Amgen, CVS Health, McDonald's and Kimberly-Clark are set to report earnings in the coming days. The midterm elections and the monthly jobs report will also arrive this week, along with the CNBC Investing Club annual meeting.
Sources: CNBC Top News.
Questions and answers
- What did Jim Cramer say about market volatility?
- He warned that volatility on Wall Street may not be over and advised against trying to call a bottom in the Nasdaq.
- Which companies are reporting earnings this week?
- Apple, Palantir, Advanced Micro Devices, Pfizer, Amgen, CVS Health, McDonald’s and Kimberly-Clark are scheduled to report.
- How might the midterm elections affect markets according to Cramer?
- He said a shift in congressional control could threaten planned data center projects, though some states may welcome them.
