CNBC’s Jim Cramer said falling oil prices and U.S. Treasury yields are fueling a broad rally in the stock market.
brent Crude oil prices fell 7.63% on Monday to close at $104.77 per barrel. 10 year treasury This helped boost stocks across the healthcare, financial, retail and travel sectors. Cramer said improved market conditions have led investors to reconsider strong earnings reports that they had initially overlooked, accelerating the shift to growth opportunities beyond technology.
“Never forget what this market is really about: oil, inflation, interest rates,” the “Mad Money” host said. “Oil oil plummeted overnight, interest rates fell, and many stocks soared.”
Kramer pointed out that Amazonup 2% on Monday, is an example of how lower interest rates can change investors’ perceptions of stocks. Following the company’s quarterly report last week, the stock rebounded after an initial struggle. Cramer argued that Amazon’s performance was stronger than the market initially realized, and that “as expected, Amazon has returned to its late-September levels on the back of improved interest rates.”
Similarly, waste management Shares rose 1.8% as investors finally took credit for last week’s strong quarterly results, which Cramer said were overshadowed by rising interest rates.
Still, Kramer cautioned that it may be difficult to maintain the scale of the movement. “At the same time, you’re just piling up money in stocks,” he says. “They are not sustainable.”
But as investors continue to drain money from technology while keeping their bets in broader markets, companies in other industries could increasingly take the lead, Cramer said. “These are new alternatives for growth as technology continues to lose its luster,” he said.
Kramer said the rise extends to medical device manufacturers, which are emerging as an attractive option. medtronic It rose 3% on Monday, but GE Healthcare 4% increase; intuitive surgery It increased by 1%. “If you can find growth stocks that aren’t tech stocks, you can really sweep away,” Kramer said.
Financial stocks also rose as concerns about consumers’ ability to repay their debts eased. capital one It rose 3% after struggling last week on concerns about rising gas prices and credit delinquencies.
This profit boosts consumer companies; walmart and costco Each will increase by approximately 3%. “Lower fares and cheaper gas means more (money) to spend in the store,” he said.
Cramer’s Charitable Trust, a portfolio managed by CNBC’s Investment Club, owns shares of AMZN, COF, and COST.
