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Jim Cramer (1:25)
Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramer ar Friends. I'm just trying to make a little extra money. My job not just to entertain, but to educate, to teach you how this business works. So call me 1-800-743, CNBC or tweet me at Jim Cramer the next time you get too down about the stock market, I want you to remember this wonderful quarter where we got knocked down the canvas after Liberation Day, only to eventually rally all the way back and then some. I keep hearing the word resilient. I say, how about stellar? It was never easy, including today when the S and P and the Nasdaq hit record levels, then reversed after President Trump broke off his trade talks with Canada because it imposed a digital services tax, made it retroactive to 2022. But then the market eventually shrugged off the Canadian spat, with the Dow gaining 4 and 22 points and both the S and P and the Nasdaq climbing 0.52%, the latter two closing at record highs. None not out of 11 sectors were up today. This kind of stuff, so rare for so many years, has become commonplace in the last part of this quarter. Still, I think this market will remain strong even in the face of a jarring story like the Canadian tariffs. The individual investor has learned that the best way to make money is to stand pat, stay in, maybe even add money into the declines, which has been the best strategy for while institutions flitted in and out, in and out. There's data that shows that the individual investors stayed in and even bought more weakness. Yes, they bought the dip. It turned out to be right. That's pretty incredible. Incredible. Just stick with stocks during this period. You had to hold on through Liberation Day insanity. The endless calls by the President to get Fed chief Jay Powell to step down because Trump wants immediate rate cuts. The nonstop chatter about how the economy will crumble under the weight of trade wars, the relatively high interest rates, and the endless breathless chatter from Fed heads who end up not mattering anyway. It's a parade of horribles that requires you to hold your nose, avert your eyes and keep buying. So I salute you for staying in. I know it couldn't have been easy to hang on through this decline, but it sure was worth it, wasn't it? Okay, now, we did have this one anomaly at the end of the day, the annual Russell rebalancing. And that's where the Russell 1000, 2000, 3000 rebalance to reflect changes in the market's capitalization. This is a big deal because there's really very little liquidity in some of these smaller stocks. Look for many of the most egregious moves that were done at the close today to be undone Monday morning, both on the buy and the sell side. People didn't seem to know about it. It just. It's kind of strange because used to be such a big topic of conversation now also after the close, we got stress test results for the banks. It's an annual fair which gives the banks that they get good grades a chance to buy back a lot more stock. All 22 banks passed their stress test tonight. Not unusual. So maybe we can see a bunch of buybacks announced next week based on these good grades. I know that I have been very upfront about how Capital One cof. Good piece in the Wall Street Journal say about it has an opportunity here that would be the one that I think could do the best in terms of what people are thinking about going forward. With that out of the way, what's coming up next week? All right, a week that's really just three and a half days, frankly, because of July 4th falls incredibly well. It falls on a Friday this year and Thursday's now a half session. It's a slow week, but it does end with a bang. All right, now, Monday we have a very special interview with Andy Jassy. He's the CEO of Amazon. Huge position for my chapel trust. We'll talk about everything from investments in rural delivery to new and improved Alexa to the growth of Amazon Web services, the juicy gross margins of Amazon advertising, and why we love being prime members given its retail presence. Amazon's got a great read on the consumer. It's international business seems to turn the corner. We need to talk AI and whether its own chips are a threat to videos, best semiconductors or just something that can be made to augment them. And of course we're going to talk about China. Right now I'm concerned about the consumer. After we got some weak consumer spending data today, I hope Amazon's Jassy can give us some color about how consumers are really spending. They seem stalled right now, something that should make the Federal Reserve think twice about whether they can really afford to wait before they start cutting interest rates again, which is really something that's very much on the table. Now, I'm not worried about the industrial portion of the economy, which has been pretty strong, but I am trying to figure out if the numbers have been distorted by orders pulled through because of the tariffs. That's why I'm more interested than usual in something called the Chicago pmi. I think it's the best indicator of the industrial economy and it could influence interest rates if it is weak pulling, putting even more pressure on the Fed to start cutting again. Right now the market's pricing in an 18.6% chance of a rate cut at the July meeting, but a more than 93% likelihood to cut it by September. I don't know if we can wait that long. On Tuesday, we get results from former market darling Constellation Brands. What a fallen idol. There is so much to unpack here because this consumer packaged goods company is a microcosm of what's going wrong with this now pathetic group. That used to be the place to go when there's a slowdown. First, Constellation is an alcohol company, so all their products are being hurt by the GLP1 drugs, which can blunt your craving for booze. That's especially true for the big beers, which are Modelo, Corona and then a new popular favorite, Pacifica. Second, increasingly, surveys show that there's a switch from beer to cannabis because smoking weed is theoretically less fattening. I say theoretically because while alcohol has way more calories, it doesn't give you the munchies. This younger generation cares more about their health than previous ones. Sounds fanciful, but it is true. Third, Constellation said its sales have been hurt by concerns in the Hispanic community about mass deportations. The stock's been steadily declining, all quarters downgraded by analysts jumping ship from the company that used to beat and raise and Beat and raise over and over and over again used to be a big position for my trust. That was then. Now we expect Constellation. Miss. We'll get the results Tuesday night and the conference call will start on Wednesday morning. You'll probably see the stock jump up when it reports. That's what it typically does. And then it declines through the rest of the day. So let's be careful. Okay? Also on Wednesday we get mortgage application numbers. And these have become an albatross for the entire economy. As long as rates remain this high, we've come to accept anemic home sales. And given the housing punches above its weight, we know that this end of the economy will not be be improving. Thursday is the key day of the week. All right. That's when we get the June non farm payrolls report. It's an important number. It always is an important number. If we get a weak number, the President is most likely on that day going to call for Jay Powell. Said again maybe willing to name Powell successor that day much sooner than expected. If only to push Jay to start cutting rates or quit his job, which I think by the way, he's not inclined to do. I don't think any one week number, even one as important as the labor report will matter all that much. But if we see very few new jobs created, match that with lower or flat wages, perhaps the possibility of July rate cut will be back on the table. The bottom line, we're headed for a shortened week after a terrific quarter. One that started horrendously and finished incredibly strong. Showing you that staying the course is the only logical way to approach this often mercurial and treacherous market. Let's start with questions. Let's start with Rick in California. Rick.