Cramer’s Game Plan: Strategies for Week Ahead
Up and down Wall Street investors are wondering if the reversal has legs or if negative sentiment is about to return with a vengeance.
Although stocks closed higher on Friday, Jim Cramer largely believes the price action is best described as a relief rally. That is, pros were so relieved that the jobs number didn't generate a major sell-off, they instead bid the market higher.
Whether the buying endures or not will most certainly be influenced by events next week. And there's a lot on the agenda.
Following are the earnings reports, economic data and other potentially market moving catalysts that Jim Cramer will be monitoring in the week ahead.
MONDAY JUNE 10TH
On Monday morning, Cramer thinks data from China will dominate the mood in the market. "Be prepared for the market to scrutinize Chinese industrial production and retail sales," Cramer said. "They will probably be dismal but expectations have gotten so low that numbers that show even a tenth of a percent improvement could ignite interest in cyclical stocks."
Digging down into the market, Cramer will put technology front and center with the Apple Developers Conference. "Right now people think Apple has lost its creative spark and surrendered its tech leadership to Samsung. Monday can change all that if Apple unveils some dazzling products. If they don't dazzle I fear that Apple's just going to be total dead money until the next quarter," said Cramer.
Also, the Mad Money host will be taking a read on the high end with earnings from Lululemon. "I like the stock but it's been on a tear. I would suggest some register ringing ahead of the report," said Cramer.
In addition, Cramer will take the pulse of organics. "We also will hear from Annie's and I think this high multiple stock could struggle," Cramer said. "That said, I like the natural organic natural theme for the long-term."
TUESDAY JUNE 11TH
Cramer will have IPOs on the brain Tuesday. "Coty, the fragrance and cosmetic company and Gigamon, a profitable enterprise tech concern both go public," Cramer said. "I bless speculation in both."
Beauty products and services will also come onto Cramer's radar with earnings from Ulta Salon. "I am worried about this," Cramer admitted, "Goldman Sachs, which had been a big backer of it, decided to downgrade the stock just this week. Why do that unless you are worried about a miss?"
Also Cramer will be taking a hard look at the banking sector and the Morgan Stanley Financials Conference. "I care about net interest margin, how much a bank pays you in deposits versus what it can make in investments. I've been watching CD rates like a hawk and even as Treasury rates flew higher this last month, CD rates didn't. That suggests banks are profiting."
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WEDNESDAY JUNE 12TH
Retail will be the watch-word on Wednesday. "Last week Vera Bradley, Ascena and Francesca all gave the market cause for concern. I think we may hear a different story from PVH," Cramer said.
In addition Cramer will be keeping an ear peeled toward the Piper Jaffrey Consumer Conference. "I will be listening to the likes of Michael Kors, Urban Outfitters and Gap, all of which I think are doing very well. On the other hand, we'll also hear from Ascena and Vera Bradley, which reported terrible numbers. Maybe we can find out what the real story is from the conference presentations," Cramer said.
Also, the budget deficit will dominate headlines. "I'm expecting a blow your socks off number that shows less spending and much more money being taken in. That, in itself, could cause interest rates to go lower and stocks to go higher because of the symbiotic relationship between bonds and stocks, where stocks go down as yields go higher and vice versa."
THURSDAY JUNE 13TH
On Thursday Cramer will be looking at the state of employment. "We get initial jobless claims, and I've often found that the weekly jobless number right after the non-farm payrolls report is really a pretty big deal because it either verifies or undercuts that big bad event you thought was in the past. I think we'll be fine, but I can't diminish its importance."
Also the affluent shopper will command Cramer's attention when Restoration Hardware reports. "I think Restoration Hardware has real momentum because of the housing comeback. It just did a secondary at $50 a few weeks ago and has since rallied more than six points. I bet it could go higher," Cramer said.
FRIDAY JUNE 14TH
The health of the recovery lands front and center on Friday with new industrial production data. "Think of it like this: we had a huge move up in interest rates, but we haven't had a accompanying rally in business. That's another big reason why the interest rate romp spooked people, as higher rates could throttle back whatever business activity we have. So we'll get a handle on just how soft the industrial economy really is when we see this number," said Cramer.
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