Stop Trading!: Do Stocks Signal a Rate Cut?
The market is so “completely exhausted” after this past week, Cramer said during Friday’s Stop Trading!, that it’s “falling on its own weight.”
The Dow was down about 20 points with just a half-hour left in trading, and many on Wall Street seem to have already shifted their attention to problems other than the House’s passing a $700 billion bailout bill, such as falling employment numbers.
Cramer’s been watching Coca-Cola, McDonald’s and Schering-Plough , stocks that increase in value when the market assumes no Federal Reserve rate cut is coming. But all three are down Friday. Someone somewhere might be expecting a cut then, Cramer said, if not here in the U.S., then overseas.
The SEC won't let the shorts target financials stocks, so Cramer said the next victims could be the retailers. Rumoring down companies like Macy’s and J.C. Penney wouldn’t be too hard as the holidays approach and credit is tight.
Lastly, Cramer was surprised by Eli Lilly’s move for ImClone.
“These big pharma companies are so desperate that you have to believe that every biotech stock could be a target here,” Cramer said, “because ImClone’s one of the worst and Lilly’s after it.”
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