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Wall Street is "terrified" of a potential Elizabeth Warren presidency and it has opened up buying opportunities in the market, CNBC's Jim Cramer said Thursday.
The worried investors are trying to game the 2020 election and the Massachusetts senator's odds of winning the Democratic Party nomination and the White House as she closes the lead of front-runner Joe Biden and even surpasses the former vice president in some polls, the "Mad Money" host said. The most recent Quinnipiac poll has Warren practically tied with Biden.
On top of lingering recession fears, impeachment talk and other contradicting factors, it helped contribute to the nearly 80-point drop in the Dow Jones Industrial Average, 0.24% fall in the S&P 500 and the 0.58% decline in the tech-heavy Nasdaq Composite, he said.
"As long as investors have trouble understanding that President Trump won't be removed from office by a Republican Senate, and Elizabeth Warren isn't some Marxist insurgent out to destroy capitalism, we could have more difficult days like this one," Cramer argued. "Maybe lots of them. Get used to it."
Warren's rise in the polls reflects the fall in managed-care stocks. Shares of both Cigna and UnitedHealth Group shed more than 3% in value during the session. The Massachusetts senator is part of the Democratic Party's progressive wing that wants to pass a national health-care system dubbed "Medicare for All." The program would get rid of the Affordable Care Act, widely known as Obamacare.
Cramer, however, went against the grain and recommended buying UnitedHealth because it has a 2% yield and is "about as oversold as any stock I can recall, down more than 70 points from its highs." He also noted that Cigna is a good opportunity as well.
"If Warren can really pass something like Medicare for All —a very big if — then the managed-care companies ... [will] cease to exist," Cramer said. "We don't even know if Sen. Warren is going to get the nomination yet, let alone the presidency. And even if she does win, that doesn't mean she'll have the votes to pass single payer.
"I think it's too soon to count out UNH out. It's too soon to write off Cigna," he continued. "These companies are coining money. Still, that doesn't change the fact that Wall Street is terrified of a Warren presidency, and you can see that fear everywhere."