CNBC’s Jim Cramer said Friday that the market was “incredibly overconfident” following reports of a ceasefire between Iran and the United States, causing a massive rally in stocks this week.
of S&P500 Friday’s closing price was up 3.6% from the start of the week. The rally was fueled by President Donald Trump’s two-week pause on attacks on Iran announced late Tuesday, giving markets a temporary reprieve from the conflict that has weighed on stocks since early March. of Nasdaq Composite and Dow The stock has also risen 4.7% and 3% in the past five sessions, respectively. Each index had its best week since November.
“Two weeks ago we were oversold because everyone was nervous, and then we heard rumors of a truce and there was an explosion of buying,” the “Mad Money” host said. “Now I see a lot of people suddenly becoming optimistic about stocks after making huge profits, but this doesn’t match the dangerous nature of the situation away from the market,” he added. “The idea that everything will eventually work out in the Middle East seems pretty far-fetched to me.”
Mr. Kramer said it would be unwise for investors to take sudden action with the market in such a dangerous state and with all the uncertainty of war. After all, less than two days after the ceasefire was agreed, President Trump warned on Thursday that if Iran was going to charge oil tankers passing through the Strait of Hormuz, it “better stop now.”
“Frankly, (the market) is incredibly overconfident right now, given the tenuous nature of the ceasefire with Iran and the fact that they could shut down the most important commercial waterway on the planet at a moment’s notice,” Cramer said.
If investors feel a desperate need to buy or sell right now, Cramer reminded them that the market is not a “make-or-break moment.” He added: “As far as I can see, there is no systemic risk here that would cause the entire building to collapse.”
Kramer then turned to next week, when corporate earnings will be the focus.
goldman sachs The major banks are scheduled to announce their financial results on Monday morning. Barring any serious war developments over the weekend, Kramer predicted “solid numbers and a good response.” He pointed to upside potential for Goldman’s trading desk, which benefits from stock market volatility. Goldman is also a holding in the Kramers Charitable Trust, a portfolio managed by CNBC Investment Club.
Earnings will be brought in on Tuesday. johnson & johnson In the same way. Kramer likes the drug company because of its strong pipeline. Cramer said the stock has a tendency to “get hammered” on the initial earnings call and rebound once the management conference call begins. “If it explodes, try to get something,” he added. In fact, the charitable trust started its position at Johnson & Johnson on Wednesday.
JP Morgan, wells fargo and citygroup All will also report on Tuesday.
Kramer said JPMorgan’s conference calls should be approached with caution because CEO Jamie Dimon tends to make cautious comments. Still, he called JPMorgan a “great bank.” Meanwhile, Mr. Kramer said the charitable trust’s other holding, Wells Fargo, “isn’t about earnings.” Rather, he added, “this is a long-term turnaround story orchestrated by CEO Charlie Scharf, a brilliant bank executive who wants the stock price to rise.” Finally, Cramer predicted that Citi stock would rise the most among the three stocks next week, as stock prices tend to rise in line with earnings.
wednesday morning, morgan stanleyquarter will be a good read on Wall Street’s trading appetite. “We expect to see a significant number of IPOs in the second half of this year,” Kramer said. “This investment bank should have a great 2026.”
Finally, pepsico Results will come on Thursday.
Kramer is impressed with how well Cheetos’ owners are navigating the boom in GLP-1 weight-loss drugs that has made processed foods less popular among young people. “CEO Ramon Laguarta has had some missteps, such as his chips being too expensive, but he has addressed them in a way that shows he is listening to customers, both with soft drinks and Frito-Lay.”
Zooming out, Cramer had a final message for investors ahead of next week’s earnings report.
“Here’s the bottom line: There’s definitely a notion of opportunity, even though the cease-fire with Iran was tenuous, but I think the bulls need to pull back a little bit. They need to have a little bit more fear to match the fear of what’s going to happen next week with Iran,” Cramer said.
“Otherwise, the overconfidence and overbought nature of the market won’t help us move up that much.”
