The S&P may be more like the MLB than people are willing to admit, Cramer said Thursday. Investing has a lot in common with a .500 game like baseball, where you win one day and then lose the next. What matters, though, is that people don’t swing too hard in either emotional direction following those victories or defeats
Of course, that isn’t what is happening. Because we went from loving this market on Monday to selling it with a fury on Thursday. No one seems to recognize just how mixed the business environment is right now, focusing instead on any data point, positive or negative, and using it as an excuse to go all in or cash out.
Except for a few smart companies, that is. Notice how Intel stepped up, responding to critics of its beleaguered stock price, to buy security-software company McAfee. And First Niagara Financial used the down market to acquire NewAlliance Bancshares. Of course, there’s BHP Billiton’s near $40 billion offer for Potash, too.
None of these takeover targets deserved to be as low as they were because they aren’t exposed to jobless claims or the Philadelphia Federal Reserve, two of the culprits behind Thursday’s decline. Nor are they levered to many of the reports that have ended up taking down stocks across the board. Intel, First Niagara and BHP knew this and took advantage.
Investors then need to do the same thing: When the economy is mixed, as it is now, they should use days like today to start buying. Seek out the stocks in Cramer’s favored bull markets, like shoemakers Nike or Deckers . Pick up some gold when it’s weak, as it was today. Look for a high-growth name like Chipotle . And consider aerospace or agriculture, particularly names like Precision Castparts or Monsanto .
When this story published Cramer's charitable trust owned Intel.
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