The December unemployment results could revive "bad news is good news" sentiment on Wall Street, raising the possibility of more government stimulus, CNBC's Jim Cramer said Friday.
Nonfarm payrolls declined last month for the first time since April, according to Labor Department data out Friday, as coronavirus transmission rates remain high.
"Every disappointing jobs number like this one makes it more likely we'll get another round of government stimulus checks to help cushion the blow," the "Mad Money" host said.
While economists polled by Dow Jones projected the U.S. economy would add 50,000 jobs, the results say that 140,000 jobs were lost. Despite the negative blip on the economic recovery, stocks finished the trading day at record highs.
The Dow Jones Industrial Average advanced almost 57 points to close at 31,097.97 for a gain of 0.2%. The S&P 500 grew 0.6% to finish at 3,824.68. The tech-heavy Nasdaq Composite outgained them both, rallying 1% to 13,201.98.
The blue-chip and broad market indexes both completed four-day winning streaks.
As the pandemic continued to rage during the holiday month, some state and local governments took steps to close or put new restrictions on some nonessential businesses to mitigate the spread. Meanwhile, the country continues to face challenges in rolling out Covid-19 vaccines.
The most pain in the Labor report was found in the leisure and hospitality sector, where 498,000 jobs were lost.
President-elect Joe Biden, who is set to take office Jan. 20, on Friday said that he wants to pass another stimulus package that "will be in the trillions of dollars." Biden and Democrats, who failed in their efforts to push through another multitrillion-dollar relief measure before the November election, have a much higher chance of achieving their priorities after victories in Tuesday's Senate runoffs in Georgia gave the party a trifecta in Washington.
The Biden team plans to release more details on Thursday. Many Democrats are calling for an increase in the last stimulus payouts sent out to many Americans, from $600 to $2,000.
Cramer noted pockets of strength in the economy in homebuilding and commodities. The construction industry, which is still 226,000 below its pre-pandemic levels, had a net gain of 51,000 jobs.
The unemployment rate is at 6.7%.
"That means the Federal Reserve needs to keep interest rates low to help spur hiring," Cramer said.
"When you combine the slower economy with a dovish Fed, you get a situation where stocks ... they're the only game in town, versus bonds most certainly. That means you'll get some prolonged moves higher, like the incredible run in Tesla."
Shares of the electric-car maker shot up almost 8% to a new closing high of $880.02.
The stock is riding an 11-day winning streak, rising 37% from pre-Christmas Day levels.