Jim Cramer looks ahead to next week's market game plan

Key Concepts

• Non-farm payroll report & Federal Reserve rate cuts
• US-China trade negotiations & rare earth materials
• Apple's Worldwide Developers Conference (WWDC)
• Capital One's merger with Discover Financial
• J.M. Smucker & packaged foods sector
• Deere & agricultural equipment
• GameStop & crypto
• Circle Internet Group & crypto platform IPO
• Nvidia & chip sales to China
• Consumer Price Index (CPI) & tariffs
• Chewy & online pet food retail
• Oracle & data center build-out
• Cardinal Health & drug distribution
• BlackRock & asset management
• Adobe & creative software
• University of Michigan consumer sentiment reading
• Lululemon's earnings miss
• Uber's free cash flow

1. Labor Market and Federal Reserve Policy

• The non-farm payroll report showed accelerated job growth but included downward revisions for the previous two months.
• This "soft read" gives the Federal Reserve more flexibility to cut interest rates, which President Trump supports.
• The market reacted positively, with the Dow gaining 443 points (1.3%) and the Nasdaq jumping 1.20%.

2. US-China Trade Negotiations

• Upcoming meetings with China aim to address trade issues.
• China possesses rare earth materials crucial for the US auto industry, while China desires Nvidia's semiconductors.
• Without rare earth materials, US auto factories may face shutdowns.
• Secretary Best will be involved in the talks, fostering optimism for a potential deal.

3. Apple's Worldwide Developers Conference (WWDC)

• Apple stock experienced a second consecutive positive week, possibly anticipating the WWDC.
• The WWDC is primarily a software event, not a hardware event, and typically doesn't significantly impact the stock.
• Speculators believe this year might be different, driving aggressive buying.
• Apple faces challenges, including a lack of a top-notch AI offering and White House pressure to shift manufacturing to the USA.
• Building iPhones in the USA is not economically feasible for Apple, making tariffs a more viable option.

4. Capital One and Discover Financial Merger

• Capital One will discuss its merger with Discover Financial at a Morgan Stanley conference.
• The speaker believes the synergies are "fabulous."
• Richard Fairbank, CEO of Capital One, is highly knowledgeable about credit cards.
• The stock rose $6 in anticipation of Fairbank's presentation.

5. J.M. Smucker and the Packaged Foods Sector

• J.M. Smucker reports earnings on Tuesday before the bell.
• The company may struggle to escape the challenges facing the packaged foods sector.
• Smucker's "Uncrustables" are a successful product.
• The speaker is hesitant to strongly recommend the stock due to the sector's decline and potential scrutiny from the Secretary of Health and Human Services.

6. Deere and Agricultural Equipment

• Deere, a major agricultural equipment company, will hold an important analyst meeting on Tuesday.
• The company can present a positive outlook on farmer orders.
• The speaker believes the stock can still go higher.

7. GameStop and Crypto

• GameStop's focus has shifted towards crypto.
• The crypto aspect is expected to drive the stock higher.

8. Circle Internet Group IPO

• Circle Internet Group, a crypto platform, had a popular IPO.
• The IPO's success has generated buzz about other crypto companies going public.
• The speaker is not a buyer but acknowledges the storyline.

9. Nvidia and Chip Sales to China

• Jensen Huang, CEO of Nvidia, discussed the US government's restrictions on chip sales to China at the GTC conference in Paris.
• Huang indicated a solid relationship with the president and the possibility of a deal.

10. Consumer Price Index (CPI)

• The May CPI reading will be released on Wednesday morning.
• This report will provide insights into the impact of tariffs on consumers.
• Jay Powell is taking a "wait and see" approach to cutting interest rates and will likely not act if the CPI spikes.

11. Chewy and Oracle Earnings

• Chewy, the online pet food retailer, reports earnings on Wednesday before the bell.
• The speaker believes Chewy can continue to perform well.
• Oracle reports earnings after the close.
• Oracle's last quarter was poorly received, but the stock has largely recovered.
• Oracle's data center build-out is expected to drive revenue growth.

12. Analyst Meetings: Cardinal Health and BlackRock

• Cardinal Health will hold an analyst meeting, highlighting its role beyond drug distribution.
• BlackRock, the largest money manager, will also hold an analyst meeting.
• The speaker's charitable trust owns shares in BlackRock, which are currently down for the year.
• A positive meeting could push the stock into positive territory for the year.

13. Adobe Earnings

• Adobe reports earnings after the close on Thursday.
• The stock appears poised to break its downtrend.
• The speaker acknowledges fierce competition.
• If the stock is available at under 20 times earnings, it may be worth considering as a "flier."

14. University of Michigan Consumer Sentiment Reading

• The latest University of Michigan consumer sentiment reading will be released on Friday.
• Based on the Dollar General conference call, the speaker anticipates a gloomy consumer outlook.

15. Market Outlook and White House Influence

• The upcoming week is expected to be relatively quiet.
• However, it's crucial to monitor the White House's statements, particularly regarding China.

16. Callers' Questions

• Lululemon (LULU): A caller inquired about Lululemon, having bought it based on previous advice. The speaker expressed surprise and disappointment at Lululemon's poor performance, citing tariff problems and fashion missteps. He suggested potential shakeups within the company if such results recur.
• Deere (DE): A caller asked if Deere's run was over. The speaker maintained a positive outlook on Deere, citing the strong position of farmers and the potential for multi-year moves in the stock.
• Uber (UBER): A caller expressed confidence in Uber's free cash flow and questioned concerns about autonomous driving. The speaker agreed, stating that Uber's stock would go higher.

17. Mad Money Program Segments

• The program will feature segments on the travel bull market (analyzing Vail Resorts' results), an under-the-radar aerospace and defense stock, and a portfolio diversification segment.

Synthesis/Conclusion

The week ahead is filled with potential market-moving events, from trade negotiations with China and key economic data releases like the CPI to earnings reports from major companies like Smucker's, Chewy, and Oracle. Analyst meetings for companies like Deere, Cardinal Health, and BlackRock could also provide valuable insights. While a quiet week is anticipated, the influence of the White House, particularly regarding trade with China, remains a crucial factor to monitor. The speaker remains optimistic about certain sectors and companies, while cautioning against others due to sector-specific challenges or competitive pressures.