Big Week Ahead, Bye Bye Birdie, Exclusive: Chevron CEO 7/24/23

SPEAKER_1 (0:00)

What's on the horizon for financial markets?

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David Faber (0:31)

Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street. Good Monday morning, everybody. Welcome to Squawk on the Street. I'm David Faber with Jim Cramer. We're live from Post 9 at the New York Stock Exchange. Carl has the morning off. Let's give you a look at futures. We get ready to begin trading one half hour from now. And you can see it does appear we're going to have a higher open. It doesn't mean much, of course, as our viewers well know. It can change very quickly. Let's get to our roadmap this morning. It does start with a big week ahead for investors. Megatech names will be reporting results such as Meta and Microsoft. We've also got some key central bank decisions on deck.

Plus Bye Bye Birdie, Twitter officially rebranding as X.

And Chevron pre-announcing quarterly results. Also announces some changes in its C-suite, CFO namely departing. And we're going to talk exclusively with Mike Wirth.

That will be later in the hour. But of course, as we often do, let's start with the markets ahead of what is a busy week of trading for investors given we're getting a lot of the S&P reporting numbers, including a lot of the bellwethers. Jim, I just mentioned Microsoft and Meta. You can also talk McDonald's or Coke. We can go a lot of different places.

Yeah, alphabet.

Jim Cramer (1:47)

Well, look, I think, David, that there's been two tracks of discussion among people. There's the irrelevant track, which is the Fed. And then there's the relevant track, which is the earnings. I know that's antithetical to everything we say, but there's just, empirically, you have to start doubting the idea that if you had followed the Fed in each writing piece, you would have sold, sold, sold. That was the bear dichotomy, with the bulls being the other side saying, look, if you just focus on earnings, you don't mind paying for them, particularly because worldwide there's problems.

And I come back and I say, I'm definitively in the B camp, the bull camp, because all discussion around 11 rate increases has been a dodge.

Now it's not supposed to be, it's supposed to be what we're riveted by, but the American companies have transcended the yield curve, transcended the short rates, because of just, I think, sheer brain power. There's just been a lot of really good companies, whether it be mega cap, whether it be industrials.

David Faber (2:44)

You're already passing judgment on an earning season that really is what, we're not even a quarter through it, are we?

Jim Cramer (2:48)

Yeah, I am.

David Faber (2:49)

Why? I mean, and by the way, it's not clear to me that we've outperformed that much versus expectations.

Jim Cramer (2:55)

Well, okay, I'm concerned about how the Fed did not mess with the earnings cycle. The earnings cycle is, the industrials, which should be turning down, have been a very strong group. Last week, we saw the banks and the healthcare stocks begin to get some traction.

Mega cap has been amazing. Now, look, every bet could be off if Apple and Alphabet and Meta are all wrong. I just doubt that they will be, even though their multiples are inflated. But I'm just calling for the idea that it's very easy, there have been many years where if we knew the Fed was going to take action, we would sell stocks ahead, or we would be very concerned because we're fighting the Fed.

David Faber (3:36)

Although we are at the end, to be fair.

Jim Cramer (3:38)

Well, no, but okay.

David Faber (3:39)

That's, I mean, that continues to be one of the key questions. How close are we to the end?

Jim Cramer (3:43)

And if we are at the end, then you do want to buy a lot of stocks. But I think that there's a sense that other than housing, which could be after Horton actually had a little bit lower, but not a lot, auto, which has now come down, particularly because it seems like that the EVs are not selling as much as we thought and the ICE are down.

Rentals come down, used cars come down. That means there's not been a lot of layoffs. We've only had a few closings in retail. We're not a lot of layoffs in general, which has made people feel very insecure because they expect them to happen. But what I'm saying is that this is one of those times where if you looked under the hood of the S&P, you made a lot more money than if you just looked like a hedge funder, which was, oh, rates going up, we got to sell. It didn't happen. And I think it didn't happen in part because the companies are a little more attuned than we thought and smarter than we thought.