- "I'm always searching for a mantra for any given market, and I think I've found it for this one," CNBC's Jim Cramer said.
- "No news is good news, especially when it comes to the pandemic," the "Mad Money" host said.
- Cramer noted recent moves in Novavax, Sorrento Therapeutics and JP Morgan to explain how stocks have inertia on their side.
CNBC's Jim Cramer on Monday debuted a new mantra to make sense of the current state of the stock market.
"I'm always searching for a mantra for any given market, and I think I've found it for this one," the "Mad Money" host said. "No news is good news, especially when it comes to the pandemic."
Stock in Novavax, one of the multiple biotech firms racing to produce a Covid-19 vaccine, rallied nearly 5% during the session heading into its post-market earnings release. The move extends a massive upside in Novavax's stock price, which has gone from a single-digit to triple-digit stock in a matter of months.
After trading under $4 back in January, the stock has skyrocketed more than 4,300%, closing Monday's session at $178.51 per share.
"It doesn't seem to matter that Novavax has never successfully brought a vaccine to market," Cramer said.
While the federal government has backed Novavax's vaccine candidate with a $1.6 billion award, that news came more than a month ago. The stock price has picked up almost 74 points since that day alone.
"But that's all old news. I can't tell if the old news is still in play, or if, maybe, we're back in physics class," Cramer said, "because Novavax feels like an object lesson in Newton's first law: objects in motion stay in motion at the same speed, in the same direction unless acted upon by an external force."
As for Sorrento Therapeutics, the company partnered with Columbia University researchers on a Covid-19 test that uses saliva. The process can return diagnoses in less than an hour, Cramer noted.
"Nothing has happened yet beyond the announcement, yet the stock keeps roaring. This is another object in motion," he said. "I recommended Sorrento in June when it was at [about] $4 because it seemed to have so many shots on goal. I recommended it again at $8 a few weeks ago when we learned about the Columbia deal … but now it's trading at nearly $19 and this early stage biotech is giving me vertigo."
Cramer also said that his charitable trust, which owns shares in JPMorgan Chase, made a mistake in trimming its holdings in the banking giant as Congress struggles to reach a deal on another coronavirus response package and potential defaults on loans loom. Bank stocks, however, continue to run for "no discernable reason," the host said.
"The bank stocks have inertia on their side," Cramer said. "I sold JP Morgan rather than Goldman Sachs because Goldman has a lot less exposure to real estate loans that could go bad. I was too clever by half. Turns out the whole group trades in lockstep."
Disclosure: Cramer's charitable trust owns shares of JPMorgan Chase and Goldman Sachs.