Mad Money

Cramer's game plan: Earnings tainted by Trump tariffs

Key Points
  • "Mad Money" host Jim Cramer looks ahead to the stocks and events of import next week.
  • Cramer tells investors there's more to stocks than just the Trump tariffs.
  • Cramer also assigns himself to "resign watch" at the White House.
Earnings tainted by Trump tariffs

After the stock market took a tariff-related nosedive on Thursday before recovering slightly on Friday, CNBC's Jim Cramer wanted to address how he reacted to the sell-off.

"I've got to apologize to you: I forgot to panic last night," the "Mad Money" host said. "I told you President Trump's move to slap a 25 percent tariff on imported steel and a 10 percent tariff on aluminum ... was not a reason to dump positions wholesale. If anything it might even be a reason to do some buying on weakness."

The Dow Jones industrial average's 500-point intraday plunge gave investors and market-watchers plenty of cause to panic and warn people to get out of stocks, Cramer admitted.

"Panic is not a strategy, ... [even] when so many of the bears seemed determined to make you bolt from stocks at all costs," he said. "There's always a better time, even if you do want to sell, than right into the teeth of the fear and the chaos that causes a brutal decline."

So as investors toy with the question of whether U.S. trading partners, particularly China, will retaliate against Trump's move, Cramer looked ahead at his weekly game plan.

Monday: Retaliation, resignation, Ryerson Holding Corp

Retaliation: Cramer expected the theme of retaliation to come to a head on Monday. If U.S. trading partners retaliate with their own tariffs or restrictions, it may cause another dip, he said.

But if they don't, Cramer said investors would likely accept the market's newly re-tested levels and hold onto their positions.

Resignation: Cramer will also be on self-designated "resign watch" on Monday after media reports suggested the potential ouster of Trump's chief economic advisor, Gary Cohn.

Cohn, also director of the National Economic Council, reportedly disagreed with the president about the announced steel and aluminum tariffs. Cramer said his resignation could wreak havoc on stocks.

"Cohn is a steady hand," the "Mad Money" host said. "If he resigns, I fear some people will start worrying that there's too much chaos in this administration's economic team, and they'll figure it's time to do some selling. That could happen. I've known Gary for a long time, and while I don't want people to buy, sell, buy, sell, ... I recognize that him leaving would make it harder to be a raging bull."

Ryerson: Cramer will also be watching out for an earnings report from Ryerson, a metals distributor that could provide an inside look at the debate around Trump's tariffs.

"It's a little company, but it's a thoughtful one," he said. "I've listened to them for years and management can tell us ... if they think there will be retaliation coming and what the retaliation actually means for American industry."

Tuesday: Target, Ross Stores

Target: The steady flow of retail earnings continues on Tuesday, beginning with a quarterly report from Target. With an e-commerce strategy that's starting to pay off, Cramer expected the retailer to deliver a comeback story in its release.

Ross Stores: After a strong quarter from TJX Companies this week, Cramer expected the strength in discount retail to trickle into Ross Stores' Tuesday earnings report.

Wednesday: Dollar Tree, Costco, Thor Industries

Dollar Tree: Cramer hoped that Dollar Tree's earnings report would change the market's negative view of the dollar stores and give investors some clarity in the tariff debate.

While some think that the Chinese government will retaliate against U.S. companies, Cramer noted that the Dollar Tree's stores (and other dollar stores) are filled with products made in China, a sizable part of the country's business.

The "Mad Money" host pointed to the tariffs announced Friday by European trade authorities on things like U.S. jeans and Harley Davidson motorcycles. China could instate similar, mostly symbolic tariffs on products that have little real-world impact, he said.

"My point? Nobody plays fair on trade, but nobody wants to start a real trade war either, and maybe by punishing some bad actors every now and then, we'll actually save some jobs in this country," Cramer said. "If the world responds by slapping tariffs on a few iconic but relatively unimportant American brands, ... I say that's a small price to pay."

Costco: Costco, another retailer filled with foreign products, will also report earnings on Wednesday. Cramer expected a strong quarter and a potential buying opportunity.

"Its stock is down $10 bucks from its highs," he said. "Given that the terrific Home Depot's down $30 bucks off a similar level and we're about to get to its holiday selling season, which is planting, I say let's hope Costco gets hit even harder and gives you a better buying opportunity before it reports."

Thor Industries: Cramer warned homegamers about the earnings report from RV maker Thor Industries, a big contributor to his "experiential economy" thesis.

"Thor could be hurt by these tariffs, so they might tell a more negative story to tell than people expect," the "Mad Money" host said.

Thursday: Kroger

Supermarket chain Kroger will report its quarterly numbers on Thursday as it faces an attack from some new rivals: German chains Aldi and Lidl and the newly Amazon-backed Whole Foods.

"Last time Kroger beat the numbers handily and you got a huge short squeeze," Cramer said. "I think the stock's run too much since then. I would actually ring the register ahead of this quarter."

Friday: Non-farm payrolls

On Friday, Cramer will be laser-focused on the U.S. Labor Department's non-farm payroll report, which will matter more than usual after last month's sell-off.

"The whole February sell-off started when we got a hot payroll number — too hot. Interest rates spiked, which caused volatility to spike and led to the bizarre collapse of the averages as all those dopey traders who bet against the VIX got obliterated by the mother of all short squeezes and had to sell their stocks," Cramer explained. "Could it happen again?"

Final thoughts

"Here's the bottom line: I'm actually a lot more worried about [employment figures] being too hot than I am about the reprisals from our trading partners," Cramer concluded. "However, if we get a good but not red-hot number, you'll wonder why the heck we sold off so hard this week and you'll be thinking, 'Why didn't we do some buying?'"

WATCH: Cramer's tariff-tied game plan

Cramer's game plan: Earnings tainted by Trump tariffs

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