Cramer’s game plan: A busy week ahead of a make-or-break report

PepsiCo: Snack and beverage giant PepsiCo’s Tuesday earnings report will be a “bittersweet moment” for Cramer as longtime CEO Indra Nooyi prepares to step down from her post the following day.

“Indra reinvented the company, transforming it from a carbonated soda and salty snacks business into a more diversified operation with many healthy offerings. I’ve come to respect her not only for her business acumen, but, perhaps more important, for her leadership role as an executive focused on doing good works worldwide,” the “Mad Money” host said.

“Indra was well ahead of the curve on important issues like diversity, equality and sustainability,” he continued. “I’m hoping she stays on as a highly visible role model for everybody, especially billions of women, around the globe.”

As for the actual report, Cramer expected a good quarter that would send the stock higher, but warned that “the sector remains extremely out of favor” on Wall Street.

Paychex: The Federal Reserve’s latest interest rate hike is “basically free money” for payroll processors like Paychex, but this quarter, the old-line administrative giant may have run into a problem, Cramer said.

“The competition among companies that advise on business services like retirement savings — one of their smaller divisions — has gotten very fierce,” he said ahead of the company’s Tuesday earnings report.

“More important, we know that Square, the ambitious point-of-sale kingpin that we like so much, has decided to get into the payroll processing business itself. Square’s a big-time disruptor and they’re all about small- and medium-sized business, which is very much Paychex’s wheelhouse,” Cramer continued. “Call me conflicted.”

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Brent hits 4-year high as US sanctions on Iran tighten supply

NEW YORK (Reuters) – Oil prices rose more than 1 percent on Friday, with Brent climbing to a four-year high, as U.S. sanctions on Tehran squeezed Iranian crude exports, tightening supply even as other key exporters increased production.

FILE PHOTO: A worker holds a cup of heavy oil south of Fort McMurray, Alberta, August 15, 2013. REUTERS/Todd Korol/File Photo

Brent crude LCOc1 futures rose $1 to settle at $82.72 a barrel. The session high of $82.87 was the contract’s highest since Nov. 10, 2014. In the third quarter, Brent has gained about 4 percent.

U.S. West Texas Intermediate (WTI) crude CLc1 futures rose $1.13 to settle at $73.25 a barrel. The session high of $73.73 was the highest since July 11. The contract is up about 5 percent this month but down around 1 percent for the quarter.

A new round of U.S. sanctions on Iran, the No. 3 producer in the Organization of the Petroleum Exporting Countries (OPEC), kicks in on Nov. 4.

“Potential for a supply shock because of declining oil production in Iran and Venezuela will remain bullish on oil prices, and the second round of U.S. sanctions on Iran in November will further support the sentiment,” said Abhishek Kumar, senior energy analyst at Interfax Energy in London.

Amid concerns about supply shortages, hedge funds raised their combined futures and options position in New York and London by 3,728 contracts to 346,566 in the week to Sept. 25, the U.S. Commodity Futures Trading Commission said.

Washington is demanding that buyers of Iranian oil cut imports to zero to force Tehran to negotiate a new nuclear agreement and to curb its influence in the Middle East.

China’s Sinopec Corp is halving loadings of crude oil from Iran this month, as the state refiner comes under intense pressure from Washington, said people with knowledge of the matter.

However, India, another top buyer, is committed to buying oil from Tehran, the Iranian foreign minister said.

Other OPEC countries have been boosting production, but global inventories have still been falling, analysts said.

Saudi Arabia is expected to add oil to the market to offset the drop in Iranian production. Two sources familiar with OPEC policy told Reuters Saudi Arabia and other OPEC and non-OPEC producers had discussed a possible production increase of about 500,000 barrels per day (bpd).

However, ANZ said in a note that major suppliers were unlikely to offset losses from sanctions, estimated at 1.5 million bpd.

At its 2018 peak in May, Iran exported 2.71 million bpd, nearly 3 percent of daily global crude consumption.

Looking to 2019, Saudi Arabia is concerned that rising U.S. shale production could create another glut, especially if a stronger dollar and weaker emerging market economies reduce global demand for oil, sources familiar with OPEC policy say.

U.S. crude production rose 269,000 bpd to a record 10.964 million bpd in July, the U.S. Energy Information Administration said in a monthly report.

However, drillers cut three oil rigs in the week to Sept. 28, General Electric Co’s (GE.N) Baker Hughes energy services firm said on Friday. New drilling has stalled in the third quarter with the fewest additions in a quarter since 2017 due to pipeline constraints in the nation’s largest oil field.

The Permian Basin is forecast to produce 3.5 million bpd in October, just below output from Iran, OPEC’s third largest producer.

Reporting by Stephanie Kelly in New York, Christopher Johnson in London and Meng Meng and Aizhu Chen in Beijing; Editing by Marguerita Choy and Chizu Nomiyama

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