“I think what happens is that this is a relief rally that doesn’t make a lot of sense,” Cramer said, especially to “people trading at home.”
Another case in point: Banks, which are cyclical plays dependent on a strong economy, are not up today despite an overall better economic picture and better housing numbers.
Also, people are saying that a stronger-than-expected situation in China is helping stocks today as well. But the country’s New Year is approaching, Cramer said, so we don’t know what kind of a slowdown will take place as a result. In fact, he recommended Wynn Resorts on the assumption that many Chinese will head to Macau for vacation during the annual celebration.
So what’s the real problem here?
“We’re reacting to too few stimuli and not enough of the actual earnings,” Cramer said.
Copper can’t boost the Nasdaq. Gold can’t catalyze Cypress Semi . So it’s no surprise that these moves might confuse investors.
“The daily moves are so exacerbated by these commodity plays, Cramer said, “that we literally find ourselves totally at sea in this market.”
“It’s just making very little sense,” he said, whether on an up or down day in the markets.
He tried to steer viewers away from commodities entirely, telling them to consider buying SCANA in the wake of FirstEnergy’s takeover bid for Allegheny Energy. In addition to the potential for another M&A deal in the group, he said the stocks have come down a lot recently and SCANA offers a 5% dividend yield.
Lastly, Cramer recommended Sears Holdings , saying he likes the company’s move to license DieHard power tools. Analysts have been calling for this for some time, but Wall Street seemed to yawn at this announcement. Regardless, Cramer said that he thinks Craftsman could be next and that he likes SHLD as a housing play.
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