Despite the growing list of reasons to be concerned about the market, CNBC’s Jim Cramer said Wednesday that he thinks there’s good reason to remain optimistic.
“In the long run, there’s really no point in being bearish,” the “Mad Money” host said. Dow Jones Industrial Average The number has increased from 853 on September 9, 1981 to more than 52,000 today.
But Cramer acknowledged that the risks are increasing as high oil prices begin to weigh on consumer spending. “The Street was quick to denounce anything sold at retail, and anything discretionary like a monthly cable bill from Comcast. Stocks of essentials and common groceries were devastated. Household goods and hardware were smashed,” he explained. comcast Shares fell 6.6% on Wednesday. procter and gamble and general mills fell nearly 2% and 1.6%, respectively, and Stanley Black & Decker fell nearly 2.3%.
The Dow Jones Industrial Average fell nearly 0.8%. This is a larger percentage decline than the Dow Jones Industrial Average. S&P500fell by 0.5%; Nasdaqfell by just over 0.6%. All three stock benchmarks extended their losing streaks to three straight.
Still, Cramer cited three reasons why he’s not ready to bet on the market: the strength of AI stocks, the resilience of banks, and the possibility that oil prices will eventually ease.
Kramer said the AI trade remains strong. Despite the overall market weakness, data center stocks, and particularly semiconductor stocks, rallied Wednesday, showing that many of this year’s biggest market leaders are intact.
Bank stocks also performed well. Their resilience is “a little counterintuitive,” Cramer said, but it suggests that rising energy costs have not yet done much damage to Americans’ savings or the economy as a whole.
Cramer said the market’s biggest headwinds could ease if the outlook on the Iran conflict changes again due to increased economic pressure. He pointed to late July. brent crude oil The stock soared above $100 until President Donald Trump suspended U.S. airstrikes to give “certain space” to peace talks. Since then, oil prices have fallen, easing pressure on stock prices.
That doesn’t mean Kramer is denying the risks of high oil prices. He warned that if prices remain above $100 a barrel, there could be further pressure on consumers and the service economy. But he doesn’t want to turn those concerns into a broader bearish view.
“When you get too negative, like in the last week of July, the narrative usually changes for the better,” Kramer said. “It’s useful to understand how things work out historically, because that’s often how things play out.”
