Cramer: Compelling mosaic beneath market
Cramer likes to dig down into the market. And he's found something intriguing.
He's identified a confluence of stock specific developments that could, on the whole, combine to create a serious tailwind for stocks.
"First, we got good news in the auto sector," he said. Car sales are remarkably strong, best in years. The auto companies are running flat out and that's terrific for jobs, and for stocks too."
Second, the Mad Money host was impressed with developments in tech after earnings from Ciena, a global supplier of telecommunications networking equipment, beat estimates with revenue surging 13.56% to $538.4 million from the year-earlier quarter.
He thinks the virtuous ripple could range from a short squeeze in Cisco to new interest in JDSU, Infinera and even Alcatel-Lucent. "That's how strong this cycle could be, given that T-Mobile, Sprint and AT&T are now all trying to catch up to Verizon in building out their networks."
Third, Cramer said the latest results in retail suggest to him that the sector may not be as challenged as he previously believed.
"We got a fantastic number from Dollar General, the gigantic ten-thousand store chain," he said. "This Dollar General piece of the puzzle makes me think that consumers didn't stop spending. Instead, it suggests they stopped spending at Wal-Mart."
Also Cramer added G-III Apparel Group said second-quarter profits more than doubled and it boosted its expectations for the year. "Given that G-III licenses a ton of sportswear brands, this could mean that Dick's, may not be doing that badly. It also means that PVH, which has a close relationship with G-III might be doing better, too."
Fourth, Cramer said some of the most heavily shorted names may not be as vulnerable as bears would have believed. For example, comments from CEO Les Moonves suggested to Cramer that the Netflix story remains very much in tact, with more people using the service.
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Also he said, "one of the greatest investors of our time, Bill Stiritz, who has engineered so many deals in the food segment, is now Herbalife's largest individual shareholder."
All told, Cramer can see the makings of a compelling mosaic in the market. However, and here's the important part, he doesn't think the mosaic comes together anytime soon to drive a rally.
The Mad Money host believes there are too many negatives looming over the market right now for stocks to rally significantly. Whether it's Syria, the debt ceiling, Fed tapering or higher interest rates, any one of these issues could grab headlines and send stocks tumbling.
"I'm still in the camp that says that you need to sell some stocks into rallies so you'll be ready for the next scare. You need to have some cash on hand because September is the cruelest of months, and in Washington it's tough to find common ground on almost anything."
Nonetheless, when the clouds lift and skies clear, Cramer sees opportunity on the horizon.
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