What Cramer is watching Monday — Buffett bulks up on Chevron, Honeywell lifted

Published Mon, May 2 20229:31 AM EDT

What I am looking at May 2, 2022 April was the worst month for the markets in years. Friday was the worst day for the S & P 500 since June 2020. Stocks are now oversold on my S & P Oscillator at minus 5.76. The 10-year Treasury note is 2.916% … Bargain? The Nasdaq plunged more 13% last month, its worst month since October 2008. Did the market fear tactical nukes or the Fed on Friday? I think the former ... Eli Lilly (LLY) price target raised to $356 from $315 at Mizuho on strength of tirzepatide, the promising weight-loss drug will be used by millions — not just diabetics. Approval could come earlier than 2024. Warren Buffett's Berkshire Hathaway buys $21.4 billion worth of shares in Chevron (CVX), bringing the value of its total investment in the energy company to $25.9 billion . Strong endorsement of CEO Mike Wirth's strategy. After the company reported earnings on Friday, we laid out all the catalysts for owning Chevron now. Exxon (XOM) and Chevron generated $65 billion in free cash flow. Morgan Stanley likes Exxon better. Honeywell (HON) price target raised to $203 from $196 at Wells Fargo — one of the few stocks up on Friday. Midwest rain makes for a bigger corn crop. Soy oil down 2.3% after being down 2.8% Friday. Soy can substitute for canola or palm oil and peanut oil. A break in the price of key ingredients? Timber stock Weyerhaueser (WY) downgraded to market perform from outperform at BMO Capital, yet very clear that numbers are too low after seeing them. This is where people are talking about lumber prices coming down. Analyst MoffettNathanson: The future of all of the new DTCs clashes with Netflix and it comes up negative. Netflix (NFLX) has hit the wall and everyone is trying to adjust to that world. Disney (DIS) looks cheapest. Citi talks about the excess supply because of Amazon (AMZN). Barclays says there is no slowdown from Dow in second half so takes up price target to $72 from $69. But Eastman Chemical (EMN) cut to $120 from $130. LyondellBasell (LYB) too, cut to $125 from $130. The VIX at 33 could be head-and-shoulders formation if it stays under 35. This has been a reliable pattern showing signs of a potential peak . Buybacks will be biggest source of demand. Blackout period lasts from last two weeks of the quarter until 48 hours after earnings announcements. Microsoft (MSFT), Alphabet (GOOGL) should be buying. Apple (AAPL), too. Good piece from David Kostin at Goldman Sachs, who says buybacks will be principal source of demand. Robinhood (HOOD): Charlie Munger just wants the trading app to go away . Mizuho drops price target to $14 from $19. Charter (CHTR) price target slashed to $436 from $599 at Barclays. This is really the denouement of cable … for now. Expect it will be a draft. Apple gross margin expansion by 80 basis points, but doesn't matter because of the $4 billion to $8 billion hit company said it would take in current quarter because of the China lockdowns. Europeans going after Apple ... Yum! Brands (YUM) better than McDonald's, says Guggenheim, which drops price target for McDonald's (MCD) to $290 from $300. Amazon cuts use of United Parcel Service (UPS). Citi says it is fine, but removing from its Focus List. Wells Fargo named a top pick at Morgan Stanley. Bank of America likes Johnson Controls (JCI): multiple levers, self-help GARP ... one of the cheapest in the industrials. Club holding AbbVie (ABBV): Wells Fargo says consensus "significantly underestimates post-2023 growth. Says time to own stock is now. Multiple pipeline catalyst. Biggest dividend yield in the group. Best next to Eli Lilly. Wedbush pulled Amazon from Best Ideas list. Spirit (SAVE) rejects JetBlue (JBLU) offer, sticks with Frontier. (Jim Cramer's Charitable Trust is long AAPL, ABBV, AMZN, CVX, DIS, LLY. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Warren Buffett at a press conference during the Berkshire Hathaway Shareholders Meeting on April 30, 2022.

CNBC

What I am looking at May 2, 2022

April was the worst month for the markets in years. Friday was the worst day for the S&P 500 since June 2020. Stocks are now oversold on my S&P Oscillator at minus 5.76. The 10-year Treasury note is 2.916% … Bargain? The Nasdaq plunged more 13% last month, its worst month since October 2008.
Did the market fear tactical nukes or the Fed on Friday? I think the former ...
Eli Lilly (LLY) price target raised to $356 from $315 at Mizuho on strength of tirzepatide, the promising weight-loss drug will be used by millions — not just diabetics. Approval could come earlier than 2024.