Dow 40,000 and Beyond, Nvidia's Big Week, Apple-China Saga 05/20/24

Jim Cramer (0:00)

It's Jim Cramer here. You're listening to the opening bell of CNBC's Squawk on the Street. Don't miss a minute of the action.

Carl Quintanilla (0:14)

Good Monday morning, welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer at Post 9 of the New York Stock Exchange. David Faber has the morning off. We're set up for a packed week of retail earnings, Nvidia, FedSpeak, pre-market's pretty steady with our first close at Dow 40K. Now in the books, got some positive market commentary today as well. We'll get to all of that. Our roadmap begins with the ongoing meltdown for stocks and why one longtime bearish strategist has finally capitulated. It is Nvidia's week, and at least four analysts upping their targets ahead of results on Wednesday.

And then Apple's ongoing China challenge, reportedly slashing iPhone prices to some new lows to counter competition from Huawei.

Let's begin though with the markets coming off an historic week for stocks. Jim, we got the 40K, we closed at 11, a handle on the VIX, just barely, but we did it.

Jim Cramer (1:03)

People are talking about the stock market.

For the longest time wherever I went, they talked about my tomatoes. And now I find they say, wow, what is that about? People who have not been in, people who are thinking, is it too late? And I try to present a constructive view, but it's gotten on people's minds, Carl. And I saw some numbers from Gallup last week that said that 62% of the people now are back, that they or someone in their house owns stocks. That's up from 52, which was interesting.

The 52 was the low, which is just when the Dow got back to where it was before 2007 So yeah, 2007, people got back to even and they left, and now Gen Z, Gen X back, millennials back, boomers, I think, just blown out and don't rely. But it's quite encouraging because if we can get people in stocks as opposed to some of the more radical things that people buy, the options, the double ETFs, single stock options, I think that we might find that the next sell-off, which I think will be one, of course, we're going to have new buyers. It's a different class and it's kind of surprising.

Carl Quintanilla (2:17)

Adding to the population of marginal buyers is important for prices.

Jim Cramer (2:22)

Right, now as long as you have the low count of IPOs, a little bit above last year, and as long as you have the buybacks above last year, and we'll talk about JPMorgan in terms of being conservative, you may have a situation where you could see, I'm not talking about the melt up, I know other people talk about that, where you see a virtuous circle, which is that every time it come down, new people come back, they come in, companies buy back, and then without a new source of supply, the equilibrium, you have to go higher.

So I think it's really quite amazing. We have people who are back and people who have never been, who are in, and it's making them money. So we have to be a little more buoyant about our outlook.

Carl Quintanilla (3:03)

In the meantime, we mentioned some of the commentary. A lot of it circles around that reflation scare being over, the upside for earnings, Deutsche goes to 258 today on S&P earnings, and then of course, Mike Wilson is all over the tape on his, it's a little bit weird because it's not a year end, it's a 12 month, but he's no longer calling for that decline by year end that he had.

Jim Cramer (3:28)

I said to my colleagues, to Jeff Marks, Ben Stoto, that I actually feel bad for the guy. And I'll tell you why I feel bad for the guy, because we forget how great he was.

We forget how he got us out. And sometimes you gotta get back in. I remember the late Mark Haynes, he used to talk to me about this. It's like, not that I tell you to get out, I'll tell you when to get in. I'll tell you when it gets too negative. He didn't understand that the market had pivoted for a lot, mostly because of the Fed. And I think he's a great, unfortunately learning lesson in that there were so many things that were negative that it should have gone down. I've been going over this with a lot of people, which is that, okay, so Ukraine, why doesn't it go down? Israel, Gaza, why doesn't it go down? Election, why doesn't it go down? Rates, why doesn't it go down? And the answer is, is that the assets come back to life.