Jim
Cramer and Wall Street agree on one thing — the Trump rally for the
stock market must come to an end. The question is what will cause it to
end, and when.
"I
don't think it is over. It is just morphing into other areas not yet
picked over, which is what happens when much of the S&P 500 (^GSPC) has jaunted higher and the Russell 2000 (^RUT) … goes up for an astounding 2 weeks in a row," the " Mad Money " host said.
Cramer
noted various positives in the stock market right now and told
investors to take note on a day like Monday, when the Trump rally slowed
down.
The first positive is that President-elect Donald Trump 's
appointments thus far have not been that bad, Cramer said. A few picks
were "oddball" and investors might not agree with them, but Trump hasn't
done anything to make Wall Street sense that it is in real trouble.
"I
think the only issue would be if companies genuinely stop offshoring
and people begin to worry about what that will mean for the cost of
pretty much everything … but I think that is very unlikely," Cramer
said.
The
second positive is that the weather has gotten cold, which matters
tremendously for retail. Natural gas companies need the cold weather,
too.
The third positive Cramer outlined is stocks' momentum. He has his eye on packaged goods stocks like Kimberly-Clark (KMB) if the Fed makes a muted statement in the event that it raises rates in December. This could cause bank stocks to stall out.
"When
you get a head of steam like this going into the last month of the
year, you typically end up with a rally that will gain fuel because
money managers won't look as negative as they may sound when they are
off the desk," Cramer said.
Finally,
Cramer sensed that mergers aren't done yet, either. There are too many
stocks that are suggesting that the takeover environment has improved,
like Rite Aid (RAD).
"In short, there is just too much smoke. There will be fire," Cramer said.
While
Cramer did acknowledge that stocks are overbought, he thinks that could
be a good sign. It means there is real money pouring into stocks.
Questions for Cramer?
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