CNBC’s Jim Cramer said Thursday that after weeks of caution he was becoming more constructive in the stock market and urged other investors to be “less cynical.”
The comments came after a broad rally on Wall Street, with the S&P 500 posting its biggest jump since March, up 1.7% during the session. The blue-chip Dow Jones Industrial Average was up 534.75 points, or 1.6%, while the tech-heavy Nasdaq was up 1.7%.
“Some would say today’s move after so much negativity is just a relief rally, others might call it a joke about a move that entrances people and causes them to lose fortunes,” said Cramer. “You could argue that after excellent numbers from Bank of America, UnitedHealth Group and Morgan Stanley, this is an earnings rally that is closer to the truth.”
However, he added, “I think it’s bigger than that.”
“This rally is about the reasonable realization that our current problems can be resolved if companies turn challenges into opportunities,” said Cramer, referring to supply chain issues such as semiconductor shortages and congestion in ports. Other economic complications are businesses struggling to fill vacancies.
“The bears are just so cynical, so jaded, that they have forgotten the lessons of history. Time and again we have had disasters looming over the years that just faded when people took action to stop them, ”said Cramer, acknowledging his cautious market outlook in September and October.
Now that the seasonal weak phase is in the rearview mirror, Cramer is becoming more “constructive”. He pointed to the efforts of the Biden government to ease blockades in west coast ports as one of the reasons for long-term optimism.
“I think the problems that plague this economy are harbingers of nothing. They are not harbingers of disaster, ”he said. “I urge you to imagine the seemingly unruly as controllable. … Let’s all be a little less cynical so that we can try to make a little more money for all the people who don’t have enough. “