CNBC’s Jim Cramer on Monday offered advice on moving closer to the stock market after news of progress on a coronavirus vaccine rebounded recovery stocks and kept home stay stocks declining.
“I think you have to be prepared for a multi-day sell-off of the Covid names.”Bad money“Host said.” These stocks have made tremendous gains. You are ripe for profit taking. “
Travel and leisure stocks like Carnival and Wynn Resorts, two companies hit by restrictions introduced earlier this year in response to the coronavirus crisis, rose double digits on Monday. The shares rose strongly early data on a vaccine study from Pfizer and BioNTechThis shows that it is 90% effective in preventing the transmission of Covid-19.
Carnival was the biggest winner on the S&P 500which rose more than 1.17%. Coupled with the boom in the Joe Biden election, investors hoped the country could turn a page as several drug makers test potential vaccines. The US is currently recording more than 100,000 positive Covid-19 tests every day.
The Dow Jones industry average catapulted over 800 points for the biggest win in five months. The Dow and S&P both hit new records.
“We were on the way up anyway, knowing who won the election,” said Cramer, “but the Pfizer news marks a new chapter in the market that has rightly made some stocks soar. “
Home trading, which includes businesses linked to activities like remote working and online shopping, pounced on the vaccine update. The tech heavy Nasdaq felt the pain as it fell 1.53% on the trading day. It was the only major average that ended the session in the red and started a five-day winning streak in which it rose 9%.
“I expect the re-opening games to keep going up while the Covid winners are hammered for the rest of the week, but some of the re-opening games should sell in strength,” Cramer said, “while the better Covid names are worth buying will be.” the weakness you will see at the end of the week if not before. “
Online marketplace Etsy more than 17% fueled, and Netflix fell more than 8% during the session and was among the biggest losers on the S&P index. Lockdown favorites Zooming and Peloton, both triple digits in 2020, fell about 20% in the vaccine news.
Clorox Stocks, which have grown nearly 27% since the start of the year, also fueled more than 10%.
“You have my blessing to sell some,” said Cramer of the stocks that are left at home, “but don’t sell all of them because we have yet another brutal winter without a vaccine.”