Cramer says these 6 ‘positives’ could lift stocks during earnings season

CNBC’s Jim Cramer on Monday said that a number of factors could help push stock prices higher, even during a bad earnings season.

Tuesday starts a new income season features some of the biggest companies in the technology, retail and consumer goods sectors. Companies like Microsoft, IBM and service now are expected to report their quarterly financial results this week.

Here are six factors that can help stocks when companies report earnings, according to Cramer:

1. Many companies are implementing layoffs. The company includes Microsoft, Sales force and fair recently announced headcount cuts, and their stock has gone up.
2. The US dollar and interest rates peaked last fall. Since then, more economically sensitive stocks have bounced back in cycles, as many companies conduct most of their business abroad.
3. The Federal Reserve could almost finish raising interest rates. It is according to a Wall Street Journal reportand that could mean worries about bad debt – and possible subsequent damage to banks – can be eliminated.
4. China’s economy is reopening. The return of the world’s second-largest economy is great news for companies, especially those in the entertainment, travel and consumer goods sectors.
5. The government is willing to spend big on infrastructure. Cash from the bipartisan infrastructure bill and the Inflation Reduction Act provide a “safety net” for companies building roads, bridges or tunnels.
6. Analysts are upgrading chip stocks. Barclays on monday upgraded Advanced micro-devices and Qualcomm to be overweight. “Remember something [semiconductor chips] Inventory surplus includes everything from mobile phones to desktops to high-performance computers. This is a huge problem,” Cramer said.

Cramer warned that while the earnings season may still not be smooth sailing, any drop in stock prices is not necessarily undesirable.

“At the time of the initial release, when we saw the numbers, I still expected some serious drops. What’s the difference from 2022? Those drops can be bought. “, he said.

Disclaimer: Cramer’s Charitable Trust owns shares of Advanced Micro Devices, Qualcomm, Salesforce, and Microsoft.