CNBC’s Jim Cramer said Tuesday that investors should be more selective after the recent market rally, warning that buying stocks near their peaks is often a “license to lose money.”
Cramer said investors should stop chasing stocks that are already up 30% or 40% year-to-date and wait patiently for a better entry point, citing volatile trading that has seen sharp price movements across major indexes.
The Dow Jones Industrial Average closed down 466 points, or 0.94%.
Cramer warned against the late-cycle exuberance in oil stocks, arguing that investors who bought producer stocks near recent highs could be vulnerable if Venezuela ramps up production and puts pressure on oil prices.
He also warned of short-term risks for banks ahead of earnings season, although he said the group was chronically undervalued.
Mr Kramer said JP Morgan Chase The company’s P/E ratio of about 16 times makes it look cheap, but CEO Jamie Dimon has warned that the company tends to emphasize risk in strong conditions, and his comments could temporarily weigh on the stock.
Kramer also pointed out cloud strike It fell nearly 100 points from its November high, but has since rebounded. He added that geopolitical instability, including the political upheaval in Venezuela, has historically led to an increase in hacking activity, increasing demand for CrowdStrike’s services.
Similarly in vain, Cramer praised Nvidia CEO Jensen Huang recently described CrowdStrike as a core cybersecurity provider supporting the $10 trillion AI-driven enterprise transformation. He also said he was confident that: microsoftwhich has not only retreated significantly since announcing its earnings due to its heavy investment in AI, but also with perennial favorites Nvidia and broadcom.
“By all means own some unpopular tech stocks, but make sure to save room for quality consumer stocks,” Cramer said.
