The stock market is off to a strong start in 2021, following strong gains last year despite the coronavirus pandemic. According to Jim Cramer of CNBC, one reason for the ongoing rally in equalities is simply the lack of people willing to sell.
“There are not enough stocks to go around,” Cramer told “Squawk Box.” “The stock market is not segregated. The stock market reflects the strength of individual companies. There are 500 companies in the S&P. Maybe 400 of them are doing better than we thought” they would making at the time of a pandemic.
On Thursday, the Dow Jones and S&P 500 business averages closed above 31,000 and 3,800, respectively, for the first time. The Nasdaq also rallied 13,000 during the session, the maiden voyage above that level. The Dow on Friday was relatively flat, while the S&P 500 and tech-heavy Nasdaq moved higher in early trading.
Cramer could make sense of the moves on Wall Street against the backdrop of a continuing pandemic, ongoing economic unrest and unrest in Washington. “It’s a very strange time. Everything about this time, there’s no playbook,” the “Mad Money” host later told CNBC.
“People come forward and talk about value versus growth. We enjoyed value in the morning and then the next day all the growth stock was up a lot more than value, “he said, referring to sexual orientation. “Is there a pattern here? Yes. People want to have stock and there is not enough stock. There just isn’t – not yet.”
Some investors have apparently raised concerns about the massive run in stocks since late March, when the coronary sell-off went viral; the S&P 500 is up about 70% since then. Carl Icahn issued a warning to CNBC’s Scott Wapner earlier in the week and said he was hedged accordingly.
“In my day I’ve seen a lot of wild rallies with a lot of wrong stock, but there’s one thing in common for all of them. They finally hit a wall and go into a big painful correction. One predicts when it will happen, but when that happens, check it out below, “the billion – dollar investment titan said Monday.
The pandemic and its impact on the stock market has created a situation that is different from the years before the dot-com crash, Cramer said. Nasdaq rocket realistic internet stocks helped up more than 500% from 1995 to March 2000, when the bubble burst.
“It’s not 1998 [or] 2000, “Cramer commented on the current market rally at the time of the pandemic.” If you get the economy open, Disneys is flying your world. And as the economy closes, you have a whole handful of stocks, the Amazons, flying. Lots of flying stuff. “