CNBC’s Jim Cramer warned investors Tuesday against trading on headlines about the U.S.-Iran conflict, citing an unpredictable stock market filled with uncertainty.
“We have so many stories unfolding because of this war that I think it might be a waste of time and money to try to redeem it,” the “Mad Money” host said. “The conclusion is this: … it makes more sense to stand on your head.”
Kramer said mixed signals between President Donald Trump and the Iranian government make it nearly impossible to bet on the outcome of the war.
Look at Tuesday’s “wild day” of trading, Cramer said. like oil stocks exxon mobil and chevron Advances of nearly 3% and 1%, respectively, followed reports that the Pentagon was close to plans to send thousands of soldiers to the Middle East. But the rise also spread to consumer and financial names after President Trump said the US was “currently negotiating” with Iran. like a bank JP Morgan Retailers rose about 1%. walmart It jumped more than 1%.
“There’s no way to explain how these forces could exist at the same time other than that one group of buyers must be in the wrong,” Kramer said. “But again, it is impossible to understand why we would be trapped in the fog of war with no real hope of rescue, even though we won the war and renounced the nuclear status that unknown Iranian leaders had hoped for.”
Kramer said it was strange to see groups like energy, financials and retail all coming together at the same time. Oil stocks benefit from long wars due to concerns about supply disruptions, while economically sensitive stocks typically rise on optimism that conflicts overseas are nearing an end.
“It’s hard to trade in a world where you smash plowshares into swords in the morning and put them back together in the afternoon, especially with the oil shock and the huge shortage of fertilizer,” Kramer said. “I think the war will resolve itself, but it’s clear that someone who buys financial products, retailers, and energy buyers is completely wrong.”
Cramer’s comments came after an overall lackluster day for stocks.
of S&P500 It fell 0.3% on Tuesday, reversing Monday’s session when the composite market index rose 1.3% after President Trump said the U.S. would halt attacks on Iran’s energy infrastructure. Cramer warned investors at the time that the market’s temporary rally was a “smell of fear” and might not last unless the Iranian regime backed Trump’s claims.
