Is it legal to upload music purchased on iTunes or CD onto a cloud for your friends to download?

Yes, it is illegal. You could, if caught, be forced to pay very heavy fines.

Here's how it works: You purchase a CD - in the purchase price is included a personal license to you and you alone to enjoy the music content of this CD. This license does not allow you to copy the CD and/or distribute it to anyone else. To do so, is depriving those who recorded the music in the first place of revenue (their sole method of income perhaps) and is morally wrong. What's to prevent those to whom you give an illegal copy to from re-copying it and distributing even more copies? Eventually the market is flooded with illegal copies, which gets back to the people who recorded it, they start tracking it down and eventually they (and the law) will catch up to you and it will get really sticky.

Spend the extra few bucks now for your own copies - paying the penalty of up to several million dollars later just isn't worth the risk.