What Cramer is watching Monday — midterm election, Apple in China, cloud collapse

Published Mon, Nov 7 20229:05 AM EST

What I am looking at Monday, Nov. 7, 2022 U.S. stock futures bounced after breaking multiweek weekly winning streaks. Midterm election is Tuesday and could go strong Republican in both House and Senate. Good for oil stocks, banks, non-union companies. Big consumer inflation numbers Thursday for the Federal Reserve to consider next month at its last scheduled meeting of the year. Still more than 40% odds in the market for a fifth straight 75-basis-point interest rate hike. If Meta Platforms (META) reins in expenses by cutting projects related to the cash cows, and it spins off WhatsApp while we wait for a better metaverse, the Club holding might stabilize given it is the worst stock in the S & P. The Wall Street Journal reports the Facebook-parent could start large-scale layoffs as soon as Wednesday. Club holding Apple (AAPL) issues with Covid restrictions slowing down iPhone production in China is supply not demand. Demand is very very strong especially for the new 14 Pro and Pro Max. Idea that China is now back to zero Covid is absurd. We don't know, though. Employment could be hurt. Still too early to buy FAANG. Opportunity may beckon but expenses are way way too high for all of them. What happened to cloud stocks ? Last week, many of them were crushed, You must read my weekly think piece — exhaustive research. Baird cuts Cloudfare (NET) price-target to $67 per share from $80 on macro headwinds. Barclays lowers Twilio (TWLO) PT to $60 from $90. Truist cuts Appain (APPN) to $50 from $65. Club holding Coterra Energy (CTRA) upgraded by Wolfe Research to peer perform from underperform (hold from sell). We added to our position on weakness Friday. Wells Fargo downgrades Costco (COST) to equal weight from overweight (hold from buy). I think this is a big mistake if we are going into a recession. Tougher margins. Citi lowers Peloton (PTON) price target to $18 per share from $23. But encouraged by improving churn of 1.2% monthly. Oppenheimer says Walmart (WMT) will top consensus estimates. The stock been creeping higher. The retail giant reports its quarter next week on Nov. 15. Banks have been winners: JPMorgan (JPM) takes out $130 per share. Club holding Wells Fargo (WFC) still cheapest and putting worst behind it. Can DraftKings (DKNG) get profitable? The stock saw a nearly 28% collapse Friday after tough quarter. Still has a lot of money. Barclays cuts price target to $15 from $18. Deutsche Bank lowers PT to $14 from $16. Is rare earths provider MP Materials (MP) the most successful SPAC? It's deal with General Motors (GM) is solid and it is in 2023. About to cut out China from refining. Guggenheim upgrades Workday (WDAY) to a neutral (hold) rating from sell. Good call all things considered. Guggenheim upgrades Okta (OKTA) to buy from neutral. Another good one. After Friday's total collapse, nearly 60% in one session, of Funko (FNKO), Bank of America downgrades stock to a neutral (hold) rating from a buy. (Jim Cramer's Charitable Trust is long META, AAPL, CTRA, COST and WFC. 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.

Traders react as Federal Reserve Chair Jerome Powell speaks on a screen on the floor of the New York Stock Exchange (NYSE) in New York City, November 2, 2022.

Brendan McDermid | Reuters

What I am looking at Monday, Nov. 7, 2022

U.S. stock futures bounced after breaking multiweek weekly winning streaks. Midterm election is Tuesday and could go strong Republican in both House and Senate. Good for oil stocks, banks, non-union companies. Big consumer inflation numbers Thursday for the Federal Reserve to consider next month at its last scheduled meeting of the year. Still more than 40% odds in the market for a fifth straight 75-basis-point interest rate hike.

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