CNBC's Jim Cramer doubled down on his calls for more stimulus spending from Washington after hearing from the head of the U.S. central bank on Wednesday.
The service sector, which comprises a large majority of the U.S. economy, faces a tall order as businesses continue to be challenged by government efforts to contain the coronavirus pandemic and high unemployment in the country.
"When we heard from Fed Chief Jay Powell, he made me feel like we desperately need another stimulus bill from Congress because it's the only way to save these service businesses," the "Mad Money" host said.
The Federal Reserve closed its last two-day meeting before the 2020 election this fall and officials signaled that they are willing to hold interest rates at zero until inflation rises above a target of 2%, which the agency does not expect to see until 2023.
In his speech, Powell suggested that "more fiscal support is likely to be needed" as small businesses continue to struggle, industries remain hobbled by contagion containment efforts and about 11 million people remain without jobs. State and local governments are also suffering from revenue loss as expenses rise due to a coronavirus outbreak across the country that has yet to let up.
Lawmakers in Washington have been at a standoff over what to include in another coronavirus relief package, but President Donald Trump on Wednesday said that his party should "go for the much higher numbers" as he attempted to blame Democrats in a tweet for not wanting to send out more direct payments to individuals.
Senate Republicans have refused to back another massive spending program that House Democrats have put up, and the GOP-led chamber failed to push thorugh a so-called "skinny" measure that calls for significantly less spending.Â
"I think he's (Powell) right, but I'm skeptical that the Democrats and Republicans will be able to reach a compromise," Cramer said.
His comments come after a mixed day of trading on Wall Street. The Dow industrials average gained more than 36 points to close at 28,032.38. The S&P 500 declined 0.5% to 3,385.49 and the Nasdaq Composite dipped 1.25% to 11,050.47, brought down by selling in big tech stocks.
FedEx, which topped Wall Street estimates in its fiscal first quarter report out Tuesday, saw its shares rally nearly 6% in Wednesday's session to a new closing high on the year of $250.30. The shipping giant posted earnigns of $4.87 per share behind revenue of $19.32 billion, above Factset estimates of $2.70 and $17.55, respectively. Daily package volume surged 31% to 11.6 million in the quarter, the company reported, powerred by online shopping.
FedEx led the DJ Transportation Average almost 0.7% higher as all the airliners on the index rose at least 2%, but all the railroad components slipped during the session.
"The pin action from FedEx caused the transports to roar and even allowed Boeing to rally on a day when the House of Representatives released a horrendous report about the company's problematic culture."
Boeing, which is sandwiched between both the effects of the pandemic and its ongoing controversy from two fatal plane crashes dating back almost two years ago, was blamed alongside the FAA in a House probe for failures in its 737 Max planes. The company has been working on a fix that it hopes will clear the popular seeling aircraft for use again.
Boeing shares rose almost 4% on the market to close at $167.46.
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