The IMF trims its economic growth forecast again as the U.S.-China trade war continues, Brexit worries linger and inflation remains muted.Economyread more
Citigroup thinks Tesla investors hoping for a post-earnings rally later this week should scrutinize a pair of related financial metrics.Investingread more
Olive branches were extended from both China and the U.S. as the two nations are set to restart face-to-face trade negotiations after a monthlong truce.Marketsread more
Coca-Cola topped Wall Street's expectations for earnings and revenue.Food & Beverageread more
New disclosures show Facebook and Amazon each spent more than $4 million on lobbying activity in the second quarter of 2019.Technologyread more
Boris Johnson, one of the biggest voices in the Brexit movement, wins the Conservative Party leadership race by a 2-1 margin.Europe Politicsread more
Disney can nearly double its earnings by 2024, Morgan Stanley said in a note to clients on Tuesday.Investingread more
Amazon is expected to report its second-quarter earnings on Thursday.Investingread more
The largest residential brokerage company in the U.S. is partnering with the largest online retailer in a strategy to boost sales for both.Real Estateread more
Here are the biggest calls on Wall Street on TuesdayInvestingread more
Canaccord Genuity's Tony Dwyer believes stocks are about to fall as much as 5% from their all-time highs.Trading Nationread more
Sometimes all it takes is a scary stock rotation to fuel a rally, Jim Cramer says.
"When money is flowing into stocks, with the mutual funds buying in endless waves and the hedge funds desperate to own stocks rather than shorting them, then you're in the land of the thousand bull dances and you don't have to worry about where the fuel for a rally is going to come from," the "Mad Money " host said.
When no money is flowing into the market, that is when powerful moves in stocks and sectors can occur, Cramer said. This is because when investors are reluctant to invest, money will be pulled out of the least exciting groups of stocks and rotate into sexier names with more lift.
But here is the problem with rotations: without new money flowing in, gains often become zero-sum and will run out of fuel. The leaders will run out of steam with nothing to drive them higher. That is when the worst possible rally can occur — a rally in the wrong stocks.
These "wrong stocks" names are those that signal a slowdown or recession. Areas like food and drug stocks become the new market leaders.
"You never really want to see any of the consumer staples roaring higher in a sustained advance because it means people think the economy's going to either get worse or simply stay in awful shape for a long time to come," Cramer said.
Cramer considers seeing a stock like Altria, PepsiCo or General Mills spark a powerful rally one of the most horrifying things in the stock market. Often that can cause an immense amount of damage, unless there are vast sums of money coming in from the sidelines.
He also recommended exercising caution when defensive food and drug names also rally. Often just taking note of sector leadership will give investors a strong read to determine if it is a sustainable rally.
In the meantime, Cramer recommended looking for opportunities to buy high-quality names where the stocks — not companies — are broken.