Wall Street's reaction to newly released data on a coronavirus vaccine candidate study revealed that the market lacks discipline, CNBC's Jim Cramer said Monday.
Researchers at Oxford University and AstraZeneca, one of the dozens of drugmakers racing to develop a potential Covid-19 vaccine, released positive results from their early stage human trial, but the good news did not lead to gains in the recovery plays, the "Mad Money" host noted.
"I think the people who bought the recovery stocks all last week and sold the Nasdaq were expecting much more rapid progress, so they threw a temper tantrum, dumping the cruise lines, dumping the airlines, dumping the hotels and dumping the shopping malls, then swapping into the tech stocks that profit from the pandemic," said Cramer, who earlier Monday blasted America's coronavirus response, calling it a "self-inflicted" disaster.
Despite the encouraging news from the phase one study by AstraZeneca and Oxford, the pandemic plays led the way as the market advanced in Monday's session. The Dow Jones inched up almost 9 points to 26,680.87. The S&P 500 advanced 0.84% to 3,251.84, and the tech-heavy Nasdaq surged 2.51% to 10,767.09.
The Cramer Covid-19 Index, which is made up of stocks that benefit from the stay-at-home environment, lifted 2.30%.
"In other words, it's not that the AstraZeneca results were disappointing, it's that too many buyers needed a reality check. Once they realized there was no miracle cure, the Covid-19 stocks came back with a vengeance," Cramer said.
"Remember that the Cramer Covid-19 Index — the ones that do better with Covid — represents close to half of the S&P, but more importantly, when you lump in the financials and health care ... you're talking about 70% of the market that either benefits from the pandemic or works either way," he added.
As for the investors who are concerned that the U.S. will enter another lockdown but betting that the government will dish out another round of stimulus funds, the stocks of Walmart, Dollar General, Target and Dollar Tree are worth playing, he said.
Cramer's charitable trust owns shares of Facebook, Amazon, Apple and Alphabet.