CNBC’s Jim Cramer pointed out on Monday that retail investors ignore talk of a potential market spike when the economy is in recovery mode.
“With all the manual work about how good this is for the market, today’s campaign has shown that there is no high point to be seen.”Bad money“said the host.” If you can’t imagine the economy getting much, much stronger, the problem is entirely up to you. “
The comments come after the S&P 500 closed with a new record of 4,187.62, an increase of 0.2%. The tech heavy Nasdaq Composite rose 0.9% to 14,138.78 for the first record close in more than two months.
The Dow Jones industry average was the only decline in the major indices, falling about 0.2% to 33,981.57. The index is within 1% of its highs more than a week ago.
“You could see the money flowing out of the grocery, drug and packaged goods stores and going straight into the cyclicals today,” Cramer said. “That tells you that the market found out and disproved all of this top-notch talk.”
Cramer noted that money managers would ditch cyclical stocks or names that would outperform during periods of expansion when the market actually neared a high. However, Americans are expected to spend more on travel and entertainment as the country reopens fully and pulls away from the downturn caused by the pandemic.
This may explain the increase in the cinema operator’s stock holdings AMC, Elevator company Otis worldwide and steel manufacturers Cleveland cliffsCramer pointed out that his shares were up 13.2%, 7% and 5.3% respectively on Monday.
“This is the beginning of a new cycle, not the end that all automakers can benefit from,” he said.