According to Jim Cramer of CNBC, a strong showing by Republicans in the midterm elections could lead to a surge in energy stock prices. According to Cramer, in that situation, oilfield services companies like Halliburton and SLB, formerly known as Schlumberger, ought to be among the best performers in the sector.
If Republican candidates do well in Tuesday’s midterm elections and gain a majority in at least one chamber of Congress, CNBC’s Jim Cramer said he expects a short-term uptick in energy stocks.
Oil and gas companies should be among the “biggest winners” if that were to happen, Cramer stated on Monday evening. He said shares of oilfield services firms — such as Halliburton and SLBformerly known as, In that scenario, Schlumberger should be exceptional. Shares of Halliburton are held by Cramer’s Charitable Trust.
“The producers of oil and gas would come next… that need more pipelines to bring their product to market,” Cramer added.
A strong Republican showing on Tuesday would probably be interpreted by Wall Street as favorable for financials outside of the energy sector, according to Cramer.
“The Biden administration is considered incredibly anti-bank, so you might want to buy the majors: JPMorgan, Bank of America, or Wells Fargo, the latter being a big position in the charitable trust,” he said.
Of course, Cramer issued a warning, saying that how the market reacts to the election results on Wednesday will depend on what transpires during Tuesday’s trading session. All three significant U.S. stock indexes finished solidly higher — a move Cramer suggested was “a kneejerk presumption that Stock prices will undoubtedly increase if the Republicans win [Tuesday night].”
“If the market keeps running [Tuesday] in anticipation of a Republican sweep, you need to be aware that we’ve already had a big move,” he said, “and that may be all we’re entitled to for now.”
Cramer said unless interest rates move lower or outlooks for corporate earnings improve, “there’s a lot that stays the same even when Congress is handed over.”
Reference: https://www.cnbc.com/2022/11/07/cramer-strong-gop-showing-in-midterm-elections-likely-good-for-energy.html