climbed almost 6% Thursday, Cramer pointed out, despite reporting an ugly third quarter. Profits plunged 75%. The catalyst for the stock’s rally, though, was CEO Frederick Smith statement that the worst of the company’s problems had passed. Apparently, that was enough for Wall Street.
“This is a new kind of market,” Cramer said.
He attributed Thursday’s Dow declines to options-expiration week, as investors squared their positions. He also said the market was catching its breath after this week’s rally.
One sector in particular that Cramer thought called for a time out was the financials. Fannie Mae, Freddie Mac, AIG and Citigroup all had been up significantly.
“I think that when you see that kind of action,” Cramer said, “you have to take a breath.”
That’s not to say the move higher is finished. But investors might consider taking some profits so they have cash available before the market turns up again.
Cramer did say he doubts the market will dip to recent lows because buyers who missed this latest rally won’t want to miss the next one. Any significant decline would most likely lead to increased buying activity.
Lastly, Cramer called Congress’ bill to tax bonuses for executives who make more than $250,000 at a 90% rate “foolish.” Such measures do more to hinder than help the markets and the economy right now, he said.
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