Here are the 3 big things we’re watching in the stock market in the week ahead
A tough week for tech stocks dragged the Nasdaq Composite into its worst week since April. Investors will look to turn the page next week with the government shutdown and the start of third-quarter earnings season. Let’s take a closer look at the three big things on our radar. Shutdown 1: Could we finally see the end of the longest government shutdown in American history? We’re not here to make a prediction either way, but history suggests a solution is increasingly likely as the shutdown at the end of last week began to materially jeopardize air travel. It didn’t take long for the shutdown, which began on December 22, 2018, to end in January 2019 when the air traffic controller shortage grew, causing travel disruptions at major airports like New York’s LaGuardia. Nothing amplifies political excitement more than flight cancellations, a universally feared experience. As of Friday afternoon, the chamber’s top Democrat, Sen. Chuck Schumer presented Republicans with a plan to reopen the government, but it was met with hostility from some GOP lawmakers. However, stocks fell from session lows on Friday following Schumer’s proposal; This is a sign that the market is hungry for progress. The shutdown further soured investors’ attitudes toward economically sensitive parts of the stock market; for example, a basket of retail stocks has lost more than 7% since the shutdown began on October 1, while a food and beverage exchange-traded fund has lost more than 5%. Of course, both began to bounce back weeks before the shutdown began due to concerns about the health of the U.S. consumer. However, the closure only increases these concerns further. The University of Michigan’s historically bad consumer sentiment data released Friday morning provided the latest evidence of these concerns. “People are afraid of the dark, and we’re in the dark because of the lack of economic data, so I think people are assuming the worst here,” David Kelly, chief global strategist at JPMorgan Asset Management, said on CNBC Friday morning. The “dark” situation Kelly is referring to is the lack of government economic data due to the shutdown. “The economy is not currently in a recession, but it is slowing down. And the longer this shutdown lasts, the worse the damage will be,” he added. 2. Cisco earnings: On Wednesday night, networking provider Cisco Systems is scheduled to report its fiscal 2026 first quarter earnings. The consensus is for earnings per share (EPS) of 98 cents and revenue of $14.77 billion, according to LSEG. Analysts at Morgan Stanley said in a note to clients on Thursday that they expected an increase in revenue but expressed reservations that Cisco’s current quarter forecast could be a bit soft due to the federal government shutdown and rising component costs, which were flagged by rival Extreme Networks in late October. As a result, Morgan Stanley doesn’t expect the earnings report to be a major upside catalyst other than a major upside surprise in AI orders. In the fourth quarter of fiscal 2025, Cisco’s AI orders exceeded $800 million. Despite some investors worrying about an AI bubble, growth in data center spending has not abated, supporting our thesis on Cisco. As Cisco grows its business by catering to so-called hyperscalers, the stock is a low-level way to play the AI data center boom. Jim Cramer said Thursday night that his advice to members is to wait for Cisco’s report before buying more shares. He said the stock tended to fall in the first session after the announcement. Also, as Jim points out, the stock quietly gained more than 10% in the second half of October; This is another reason to adopt a wait-and-see attitude before printing. If something happens, we might try to reduce some shares so we’re in a better position to buy on a potential dip in earnings. There are a couple of themes to follow outside the data center on Wednesday night. The first is the discussion of the campus renewal cycle, as companies and other organizations, such as universities, replace aging Cisco routers, network switches, and other IT hardware with updated products. This could be a multi-year headwind for Cisco, and was part of why UBS upgraded the stock to buy last week. The second is its security business, bolstered by Cisco’s acquisition of Splunk. Cisco closed the $28 billion deal in March 2024. 3. Disney earnings: On Thursday morning, Disney will announce its fourth-quarter 2025 financial results. Analysts expect earnings per share of $1.05 on revenue of $22.75 billion, according to LSEG. Disney’s streaming business will be under the spotlight more than ever because so much has happened since the company’s last report in early August. For starters, the $30-a-month all-in-one ESPN streaming product launched on Aug. 21. The company isn’t disclosing subscriber numbers specifically for that service, and it’s also running a limited-time $30-a-month bundle that includes Disney+ and Hulu. But ESPN will still be reported as a standalone segment, so investors will look to its performance for clues about how well-received the new ESPN streaming service is. Another question on investors’ minds: Did the reaction to Jimmy Kimmel’s suspension in September lead to a significant increase in Disney+ cancellations? In a recent note to clients, analysts at Citigroup said they modeled Disney’s fiscal fourth-quarter net streaming subscriber gains below Street consensus due to the Kimmel-related loss. Finally, managers may ask questions about streaming price increases that take effect October 21 and their impact on subscriber retention rates. The optimistic case is that any reduction in subscribers will be easily offset by higher average revenue per user (ARPU). However, there is also a risk that some subscribers, whose economy has been weakened due to high inflation for years, may decide to leave their jobs due to Disney’s latest raises. In this context, the health of the US consumer, a growing concern on Wall Street as previously discussed, will be another point of discussion regarding Disney’s earnings, especially in the highly profitable experience business. Does Disney see any slowdown in future bookings for its theme parks and cruise ships? CFO Hugh Johnston has been known to offer such comments on earnings calls. Recent trends will also impact Disney’s 2026 financial guidance, which we should receive Thursday morning. As of Friday morning, the consensus points to a roughly 11% increase in year-over-year earnings per share, according to FactSet. This would be consistent with the multi-year snow guidance Disney provided last fall. Next week, Monday, November 10 Before the bell: Tyson Foods (TSN), RadNet (RDNT), TreeHouse Foods (THS), Enviri Corporation (ENVI) After the bell: Paramount Skydance (PSKY), CoreWeave (CRWV) Tuesday, November 11 NFIB Small Business Index, 6 a.m. ET Advanced Micro Devices (AMD) investor day, 1 p.m. ET Before the bell: Occidental Petroleum (OXY), Tidewater (TDW), Sea Limited (SE), Nebius Group (NBIS) After the close: Oklo (OKLO), Beyond Meat (BYND), Black Rock Coffee (BRCB) Wednesday, Nov. 12 New York Fed President John Williams speaks at 9:20 a.m. ET Chevron (CVX) investor day at 9:30 a.m. ET Philly Fed President Anna Paulson speaks at 10 a.m. ET Atlanta Fed President Raphael Bostic speaks 12:15 Before the bell: TransDigm Group (TDG), Circle Internet Group (CRCL), Arcos Dorados (ARCO), On Holding (ONON), GlobalFoundries (GFS) After the bell: Cisco Systems (CSCO), Digi International (DGII), Pan American Silver Corp. (PAAS), Manulife Financial Corporation (MFC), Firefly Aerospace (FLY) Thursday, November 13, St. Louis Fed President Alberto Musalem speaks. 12:15 PM ET S&P Global (SPGI) investor day 1:00 PM ET Stryker (SYK) investor day 2:30 PM ET Before the bell: Walt Disney (DIS), JD.com (JD), Bitcoin Depot Inc. (BTM), Edgewell Personal Care (EPC), Sally Beauty Holdings (SBH), MarineMax (HZO) After the bell: Applied Materials (AMAT), Nu Holdings (NU) Friday, November 14 Atlanta Fed President Raphael Bostic speaks at 9:20 a.m. ET Kansas City Fed President Jeffrey Schmid speaks at 10:05 a.m. ET Before the bell: Spire Inc (SR) (Jim Cramer’s Charitable Trust long CSCO, DIS. Stock See here for a complete list of stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trading alert before buying or selling a stock in his charitable foundation’s portfolio. 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