CNBC’s Jim Cramer is optimistic about last week’s gains in the market, suggesting that they may not be temporary. Cramer highlighted the major strides made in broadening the rally, with financials, e-commerce stocks, and semiconductor companies all experiencing positive growth. He also pointed out the reversal in the bond market, which resulted in a dramatic decrease in long-term yields.
Cramer acknowledged that last week’s market gains were hard-fought victories for the bulls, as they were unexpected in an over-sold market where pessimism was prevailing. Following the recent Federal Reserve meeting, where interest rates remained steady, Cramer speculated that there may not be any further rate hikes in the coming months. However, he cautioned that this thesis is contingent on whether inflationary factors, such as real estate prices, accelerate.
Notably, Cramer observed a change in the market’s perception of businesses with significant exposure to China. He cited positive sales results from Apple and Starbucks as evidence of this shift.
However, Cramer questioned whether these market movements can be sustained. He suggested that the fear of missing out may prompt money managers to be more cautious about where they invest their cash. Additionally, bond short sellers may become anxious as the market shows signs of a decreasing glut. While Cramer mentioned the appeal of buying shares of Nvidia, he advised investors to wait for a potential pullback before making any moves.
Cramer emphasized the importance of discipline and cautioned against going against it. He viewed the current market consolidation as a positive outcome and believed it to be much better than what the bears anticipated.
In addition to his insights, Cramer highlighted his guide to investing, which can be downloaded at no cost. He also encouraged readers to sign up for the CNBC Investing Club to follow his market moves.
It is worth mentioning that the CNBC Investing Club Charitable Trust currently holds shares of Nvidia, Apple, and Starbucks.
Overall, Cramer’s analysis suggests that although last week’s gains were significant, their sustainability may depend on various factors. Investors are advised to exercise caution and consider waiting for potential market pullbacks before making any investment decisions.